In business, the little things do make a difference
By John Haskell
As companies look toward the future, it is clear the market
will become more and more challenging – and as it does, many
companies will realize their success in the past was in spite of
Recently a company in the home entertainment, lighting
control and energy conservation industry was enjoying great success
through sheer luck. The owner is the best person to sell the
product, but he has never been trained as a salesperson. Service
after the sale was very important, but the company did not have a
service contract program. Timely information about installations
was the best way to assure customer satisfaction, but no system
existed to get timely reports. The company never developed a budget
to support its growth plans. Finally, the company did not have any
kind of marketing and sales calendar so every event, such as trade
shows, created a mad scramble.
Unfortunately, too many small- to mid-sized companies face
similar situations; there are gaps in planning and organization. And
as the market tightens, these companies will not prevail without
change. If you are doing the same thing today expecting different
results, you will be disappointed. The current market is shrinking.
You must take an increasing share of a decreasing market to maintain
or increase revenue and profits. How can you do this? Simple … the
“little things” have to be done!
recognize that they have to support their marketing, merchandising,
advertising, sales promotion, sales and sales management programs.
But, there is a natural tendency during harder times to cut back.
This is exactly the wrong move. In harder times, when your
competitors are cutting back on marketing and sales spending, if you
possibly can, you should increase your spending.
Think of it this way. On average, the top five companies in
your industry spend $200,000-500,000 annually
on marketing, advertising and promotion including trade shows,
literature, media advertising, direct mail, etc. If you assume the
five top companies average $300,000 in spending, and your company
was at one time matching those numbers, your share of visibility in
your market is 20 percent [$300,000/$1.5 million].
So, now times are hard. Let’s say all of the other companies
cut their budgets by 30 percent, so they are spending $210,000 on
average. If you maintain your spending, you now have a 26 percent
share of the visibility in your market. And if you increase your
spending by $30,000 or 10 percent to drive business during slower
times, you move up to a 28 percent share of the market activity.
That is a 40 percent increase in share for a 10 percent increase in
spending. Amazing leverage! What advantages can this bring to your
Getting a share
of the “noise” can lead to more opportunities for your company. How
can you stay visible to your customers and prospects? One very good
way is through promotion, which does not mean “discounting.”
Cutting prices is the first tactic of a weak company. You don't
have to cut prices to survive bad times.
Using your product as a promotional tool can often help you
develop interest. There are many ways to get customers to want to be
involved with you, rather than with your competition, who may be
giving product away.
Helping your customers, retailers or distributors sell more
is a great way to increase you sales and your market share.
Promotions can help them bring in customers. For example, if you
create a gift-with-purchase program when the customer gets something
“free” it will help the retailer or distributor sell more. You can
also create a self-liquidating premium promotion. For example, you
supply TV sets or DVD players to be sold by the retailer for a very,
very low price. The price you charge is what you paid for it. That
is the meaning of self-liquidating. The profit is not important.
You and your customers are not in that business. You simply use
that product to push yours.
The number of promotions are limitless; the key is to do
something all the time. In the past you may have had a single “show
special” during a major trade event and then you did nothing the
rest of the year. Now it’s important for you to do something all
the time. Take out your calendar and work with your team to develop
a powerful promotional schedule, budget and action plans.
If your company
participates in shows or events of any kind – from a Chamber table
top to a major trade event in a grand convention center – your
preparation, performance and follow-up must be excellent to
capitalize on the opportunity.
When preparing for the show, think about how you want to
present yourself. What impression do you want current and
prospective customers to get? What image do you want to project?
What are you doing to bring visitors to your booth? How will you
handle them when they arrive? Do you want to write business? If
so, how much?
It is vital to be thoroughly prepared for the show so that
you can achieve your goals. The show is a big investment. You need
good preparation to get a good return on your company's investment.
After the show, what is the follow-up process? Do you want
to participate in this show next year? You can only make that
decision based on all your experience from the show.
It’s important to get feedback from every member of your team
working the show. One very good option is called the “Show Report.”
Within a week of the event, have each employee who participated send
an e-mail report to the executive in charge of the event; this is
most likely the same person who will be responsible for decisions
regarding next year’s participation. The e-mail report should
detail the employee’s impressions of the value of the show for your
company, offer comments on new opportunities and suggest
recommendations for future participation, including a “skip it”
The Bottom Line:
times are tougher – but sweating the “small stuff” will allow you to
see your way through difficult times with great success.
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