Are you playing to win… or playing not to lose?

I recently read an excellent Harvard Business digital article by James Allen and Darrell Rigby entitled “Winning in Turbulence: Clarify strategy: choose where and how to win.“ In this piece written for CEOs and business owners, the authors state:

“The goal of strategy in a downturn is to help you end up on the right side of the mortality tables-not just surviving but poised for growth, as Darwinian forces eliminate weaker competitors. To build that strategy, you need to know exactly where you will compete, how you plan to win and how you will mobilize the organization to implement the strategy.“

To adopt this viewpoint is to move from a space of fear and indecision to one of control and ascendancy. When a competitor fails, your sales team must be ready to win over their customers and take over the relationships. You must also understand which of them are going to be profitable and add to your growth, and which you should avoid. But how do I look ahead and think big when my sales are down, even some of my best customers are paying me later than ever and my operating costs are at best, flat?

Start here:

1. Connect with your best existing customers and take the time to re-evaluate why they continue to choose your company over the competition. Talk to them – ask them to explain why they are loyal to your solution despite the choices available to them. They will appreciate your interest in them and your connection will be strengthened. You might be surprised at what you hear. Very often we lose sight of the core reasons we are selected above other alternatives, and reinforcing the marketing message around these core strengths is what will help you win business from the competition.

2. Get a fresh perspective of your website and see if your messaging mirrors what your customers told you mattered. I have witnessed firsthand how easy it is to shift your focus too far away from this core and burn cash trying too many new ideas in the desire to create growth in a downturn. This shift may create confusion for both existing customers and new prospects trying to understand how you bring value to their business as well as make it a challenge for your sales team to figure out what they should be selling.

3. Take a hard, impartial look at the financial situation of your existing customer base and all new prospects. Arguably few companies are immune from the credit and market dynamics at play right now and some may be using you as a means of funding their operations. I am not suggesting you ask them if they are struggling, but ask them what’s working for them and what is not as a fellow business owner and leader. How they answer you will explain quite a lot. There are also many valuable credit risk management tools both free and for a fee available to get an objective look at their current financial situation. How are they paying other vendors and partners? Are there any tax issues or recent litigation filed against their business? Are their customers commenting and blogging negatively about them?

4. Profile and score your prospects as a part of your marketing program. Your sales team shouldn’t be worried about the credit worthiness and financial issues affecting a prospect – their job is to fill the pipeline with buyers. You also need an equally robust credit approval process that sets smart terms for payment and protects the cash flow of your business. Remember, you would be better off not making the sale then booking it and writing it off 180 or 270 days from now, and your reps understand the pain of a chargeback - make it easy for them to succeed.

I have used this pragmatic mix of focusing on the core value prop, communicating it effectively to the right qualified targets and integrating a strong credit policy while working with many businesses from the Fortune 50 to my own small businesses. If you are ready to “play to win” and acquire new customers, then you have just taken back control in these turbulent times.

Have you found something that helps you play to win? Please drop a note in the comments or click on “contact us” to start a dialogue, I would love to hear about your experiences. - GK - www.kanuckconsulting.com

It’s a lot of work trying to please all of your customers, isn’t it? The fact that it is such hard work might tell you that something is inherently wrong with that strategy. Effective companies focus primarily on pleasing their best customers, not all of them. They also spend their marketing and sales dollars on prospects that look just like their best. I was recently reminded of this and the 80/20 rule, or Pareto principle, when reading an excellent business and lifestyle book, The 4- Hour Workweek by Timothy Ferris.

You spend time and valuable resources building the best products on the market and then aim to provide world-class service for your customers. However, providing service is also very expensive so let’s ration it. I met one of the founders of LOVEFiLM (similar to Netflix for US readers), William Reeve, at a Customer Loyalty show in the UK who spoke on this topic. His company measured the number of calls for service per month per customer and grouped customers by the expense they drove. If you called too often, you were valued differently, as a perfect customer buys the most product at the least cost for you. Smart.

Here are 5 stepping stones to sanity when it comes to understanding who truly are your “best customers” and finding more of them.

1. Do they buy your most profitable products?

   • You need to know which products have the best profit margins and then look at the customers who love those products. Then love those customers more and find out why they buy. Without this knowledge, the rest is unimportant.
2. How often do they call customer service?

   • Monitor the frequency and complexity of customer service requests. It’s a fact that very successful companies use this as a way to weed out costly customers. It’s OK to fire a problem or non-profitable customer.

3. When asked, do they speak favorably about your company?

   • Survey your customers on a regular basis and listen to their feedback. I am always learning new things from my customers, from applications for my products that I never considered to reasons why my competition might be a better fit in certain situations. Ultimately, I want my customers to be a reference without any prompting from me.

4. Do you know what they look like?

   • Use your CRM or customer data to determine the demographics or firmographics that identify the customers that meet #1-3. You will need this data to search for look-a-likes.

5. How do we find more just like them?

   • There are many great databases you can use to find more prospective “best customers” once you know what they look like. You could go for the proven, traditional compiled sources like D&B, Acxiom or Hoover’s, or newer organically grown sources like Jigsaw or Cortera to find more of them.

Finally, make sure you screen any lists with a credit score when possible. The best customers are also extremely credit worthy and will pay you on time or even early. Cash is king. One last tip – companies who are struggling financially are often the most eager to buy your products, as their options are more limited. Weed these high risk prospects out before you spend your first nickel marketing to them.

Have you found something that helps you play to win? Please drop a note in the comments or click on “contact us” to start a dialogue, we would love to hear about your experiences. - GK - www.kanuckconsulting.com

Now is the time to act to take preventative measures. There are several actions you can take to ensure retention- and more importantly- engagement of your employees:

1. Survey the employees to find out what the current climate is
a. Do the employees feel like their opinions are valued
b. Does your team understand their role in the mission of the company
c. Do the employees feel like their contribution is vital and valued
d. Does your team feel that they are working for an ethical company that reflects their personal values

2. Develop your leadership team to understand the impact they have on employee engagement
People don’t quit companies, they quit their managers. One of the most common statements in exit interviews are “My manager doesn’t talk to me.”

Research has shown that on issues related to their jobs, employees prefer to get the information from their immediate supervisors/managers. But many supervisors may not be equipped with the skills or the knowledge to do this task effectively. They might not know which company information to communicate to their staff, or how.
They need help.

The top three most often cited problems in management communication are:
• Employees don’t know what to do.
• Their problems are not heard by management
• High employee dissatisfaction and low motivation.

Once you have identified where your challenges are as a company, you can address them. The good news is changing your culture to reflect a company that attracts and retains top talent is something that can be done. The challenge is, it takes time and a concerted effort to change a culture. You must start now. People are the life blood of any company. Happy, engaged, loyal employees treat their customers with the same respect they are treated with from their managers. They, in turn, develop happy, engaged, loyal (i.e. profitable) customer relationships.

For more information on how you can better understand your current company climate and create a culture that engages your employees and your customers, please feel free to contact me at jdphillips@psd3.com.

The Sales Executive Council ™, a few years ago, published a white paper on research of how the Star sales person distinguished themselves from the core sales person.

Learning from the Stars

1. An emphasis on pre-sales activity – call planning and preparation – allows high performers to approach opportunities better armed than the core.
2. High performers focus customer facing time on relationship building, not on logistics or low value service details.

Avoiding Time Sinks

While the core is spending time on internal problem resolution or billing issues, high performers are able to focus on deal development.

High performers have learned ways to reduce the administrative time sinks that are the curse of every sales rep.

In essence, the Stars strategically build relationships, while the core focuses on tactical activity. It’s very difficult to think strategically when you are surrounded by the operational issues of the day. But you must rise above the daily challenges to become a Star performer.

Here are some ideas on how to do that:

1. Identify the best customer opportunities within your existing base
2. Identify the opportunities with customers who look like your best customers
Note: There is a great tool called the Customer Revenue Evaluation (CRE) developed by KCI that we use to help companies identify these opportunities, increasing your productivity
3. Research your customer to understand their company initiatives
4. Identify the key stakeholders in this opportunity, internally in your company, and in your potential customer
5. Prepare to position yourself as the professional who can help them reach the goals tied to their initiatives

The difference between a great sales person and the average sales person is this: The average sales person can tell the customer all about their product or service; the great sales person learns about the customer needs and motivations and shows how their product or service will help them reach their goals.

Both the Star and the core sales person need to know their product or service solution. The difference is the Star asks questions to understand the customer needs and motivations so they can find out what is important to the customer. They then share the information that the customer needs to distinguish their value from the competition. The Star does the work for the customer instead of the core sales person’s approach of telling you about the product and expecting the customer to decide what is valuable to them.

Do you want to be one of the Stars? Do you want to be a Sales Professional that drives revenue and profit? If so, invest the time to strategically know your customer. Be a Star

After 20 years of direct marketing for my own businesses as well as for many customers, I have learned to get very realistic about my expectations. A 3% direct mail campaign can be a celebration if conducted with a pure prospect database, but an utter failure if it is an upsell/cross sell campaign to your customer base. How about a 3% response using email for prospects? Don’t count on it! Try .3% on your first wave, unless you have the only stock of umbrellas during the rainy season.

OK, you are still reading and not discouraged by that number – excellent! Let’s talk about how you can make your first foray into email marketing a success:

1. Know your target audience – Remember marketing 101 from your University days? More importantly, do you remember your ABCs? That A is for Audience and it is where you must start. If you haven’t done an analysis of your customer base, or at least not recently, you will likely find some pleasant and unpleasant surprises in there. The proper way to conduct this analysis is to first have your file cleaned and enhanced by a reputable source (feel free to email me for ideas, this isn’t an ad). This will help you determine the industries, sizes, geographies and for a little more, the financial weaknesses of your customers. It will also give you the firmographics of those customers who are your best - the ones that buy the most, are the lowest cost to service, pay their bills on time and buy multiple products.
2. Be relevant – You know who these customers are, but why do they really buy from you? Surely you have competitors, but for some reason, your customers are loyal to your brand. You need to understand why, and you need to distill those reasons into your marketing message. Is it your stellar service? Are you the best value around? Do you have key benefits from killer tech that put you ahead of the rest in your space? Be creative, but weave these buying messages into the copy, then make an .html and a plain text version of the message. Some servers will not accept .html, so make sure you have copy that works without graphics and images.
3. Get what you paid for – If you are marketing to your own customers, then it is easy to send out your file for an email append. The provider can also de-dupe and clean it up for you, helping to identify changed addresses and phone numbers, too. If prospecting, the choices are broader, but you will miss more often than hit. Research your sources, and don’t get lured in by the $99 all-you-can-eat lists. These are rife with problems and are likely quite old, having been compiled from multiple sources or scraped from the web. Reputable sources will return a list that is 98-99% deliverable. Just don’t expect one provider to have everything. Most lists for B2B are only in the several million range, so you might need to multisource the project. A few top-notch providers can construct email addresses for you – they have mapped the domains for the companies already. I won’t explain the tech here, but suffice it to say, it is game-changing. If you aren’t sure of what to expect, ask for a guarantee, most good firms will do that for you.
4. Ride the Wild Surf – There are a few good rules of thumb in marketing – which is about the most highly opinionated field after politics. One is that it takes 3 impressions to make an impression. In other words, don’t expect the phones to ring off the hook or the website to be flooded with new Unique Visitors on your first wave of the campaign - you will need multiple waves with different mediums. Things need time to sink in, and if your brand is unknown, reduce your expectations by at least 75%. Another important one is that it is often the 6^th or 7^th call that gets the appointment from a busy executive. The best campaigns use email as a supplement, where after the 3^rd wave, you intersperse calls from your sales team with continued emails to get the best lift.
5. Don’t take prisoners – You MUST allow people, even customers, to opt-out of your marketing efforts. Even an opt-in list must allow people to opt-out from your list. It’s a running joke that everyone by now has opted-in somewhere – but you still need to manage this process closely and let them out. This is particularly important with prospects who aren’t expecting your message. In this case, you need to run a Can-Spam compliant opt-out permission pass message before you market to them.
6. Call to Arms – The targets are acquired, the marketing machine is prepared to deliver the goods, you are Can-Spam aware and compliant, what’s left? Your most expensive resource – the sales team - still needs to be ready. It is a great idea to provide a high level marketing overview of upcoming campaigns regularly, as well as to conduct Just-In-Time training right before launch. But reps forget the details of campaigns a month out, so a perfect time to hold a launch meeting is on the morning the phase of the campaign turns from email to calling from sales. Show them the marketing email message, explain the targets, and share your goal expectations with this team. They need to understand the desired outcome and what comprises the offer. Align with sales leadership on the timing, as end of quarter and end of month campaigns are ill-timed.
7. Celebrate! – You need to celebrate – you just incorporated an ultra low cost and effective new medium into your marketing mix. Back to the start of this blog, you need to have realistic expectations, whether you are big brand everyone knows, or a new incredible technology that everyone will know about soon will impact your open rates, clickthroughs and the number of leads generated for sales.

So why is email marketing effective? Well, let’s think about the obvious reasons:

1.      It’s cheap! Unlike traditional mail, email marketing is a fraction of the cost of doing mailers. This means you can email 10 to 20 times the number of accounts for the same amount of money. What would you rather do for a new business campaign? Mail out 1000 postcards to prospects or email to 20,000?  Prospecting is a numbers game and the more people you reach, the more sales you will potentially make.

2.      Emails can offer a way to provide more content and test multiple creative designs at a lower cost than traditional mailers, leveraging hyperlinks to your website, company logos, links to blogs, and more - all easily done in an email campaign.  In this economy, and in my opinion in any economy, it just makes more sense to email.

3.      It’s totally measurable. If you send out 1000 mailers, how do you know it even got into the hands of your prospect? Even if you pay the high rate of first class, you still don’t know if they actually opened the mail or read it. With email, you can literally know the percentage of emails that were delivered, those that were opened, those that were opened and clicked through, and tie it in to which links were clicked.

4.      It’s easier for your prospect to get to the content that matters.  What’s easier for a prospect? Reading a mailer and then having to type in your website address and go from there? Or simply clicking a hyperlink?

5.      Your sales people will love the speed from the campaign to the results.  What’s a hotter lead for your sales person? Calling every account that you mailed or calling those that opened your email and clicked the “get more information now” button? Think about it!  It also gives them a focused set of targets for calls - anyone who opened and clicked through but didn’t register yet as a lead.

So, in my experience and that of my customers, email marketing works and works very well.  The cost of doing an email campaign is a fraction of the cost of traditional mailers.  Making an e-mail template is a breeze. The ability to add and subtract various offers and information for future blasts is critical.  And, being able to instantly track who opened the email and who clicked into your website is invaluable.

If you have used email marketing in the past, please let us know in the comments section below.  We’d love to hear your thoughts; both positive and negative.

In Part 2, we’ll talk about the dos, don’ts and choices presented by email marketing.  Opt-in vs. Opt-out and more!

Can you make money in this economy? Absolutely. Do you need to change the way you do business to succeed? Very likely, and KCI can help you determine where to spend your valuable time and limited resources.  We are a management consulting team who has worked extensively with the Fortune 500 but equally with many SMEs, focused on creating new levels of success for our customers in very specific ways while helping them remain true to their core value proposition.  We creatively collaborate with you on your marketing, sales and risk strategy, then introduce the processes and recommend the right technology so you will:

Measurably Improve Customer Loyalty and Drive Growth

Obtaining a good customer is hard work and retaining them can be just as challenging.  We can help you measure your progress as your customer truly perceives it and fuel your organization with the information you need to create an amazing customer experience.

Increase Profitability and Save Money

The goal scenario is to drive low-cost growth and fully utilize the talent and resources you have at hand and then invest wisely where marketing and sales success is proven.  We can help you sell more to your current customers and grow your new business by targeting the right prospects that look like your current best customers and with good credit.

Improve Sales Performance and Increase the Predictability of your Revenue

In order to run your business effectively, you need predictable growth, governed by meaningful metrics.  We will help you improve sales performance by first evaluating your current strategy, then developing best practices and metrics designed to drive that strategy forward, leveraging the latest technology as needed.

In today’s economy, businesses need to have a clear strategic plan to accomplish these goals. KCI will help you build that plan. Contact us today for a consultation and let’s start growing your business together.