Another Advertising Idea [Archive] - Small Business Forum

huggytree

11-05-2009, 02:20 PM

i have a 15' cube van.....my company name is HUGE.....everyone thinks there are tons of my vans all over the road because they see it so often (reality is i have 1 van, but its noticable from 1/2 mile away)

guess how many times ive gotten calls from that advertising?.....ONE

Guess how many times its turned into work?....ZERO

Advertising by signs dont work well at all.....not on vans/trailors...

A yard sign for a blacktop company works great...every neighbor can see the results of their work...its right in front of them....
I had a large yard sign on a busy highway where they had to slow down to 5 mile per hour to make the turn...it was a 3story Victorian...everyone loves the house...tons of people i know said they saw my sign...it was up for 14 months!!!!!

how many calls did this job bring me? ONE
How many jobs did I get? ZERO

I had a friend who paid for a bill board for his remodeling company..had the ad up for months..

How many jobs did it bring him?...ZERO

Sign advertising really doesnt work for most businesses....if you look at billboard signs you'll notice they change every 3-6 months...why?...it doesnt work..

If i needed a trailor id sure take your deal, but as far as it working well i say no chance at all...you'll have constant turn around with advertisers....

i wouldnt give the contractor any advertising space at all....id take it all....its alot of money your giving him...it will get dented and scraped....the locks will get broken into and busted....

interesting idea, but i wouldnt advertise on it for $1 a month.

handprop

11-05-2009, 04:23 PM

Nothing could be further from the truth!

To say a sign doesn't work is insane, the reality is your sign didn't work. Making assumptions about a failed attempt doesn't mean squat. I'm willing to bet the sign was a yard sign and had just your name on it, am I right? The sign was probably 24" x 16" give or take, the same kind of sign everybody does. I bet i'm close on this.

If you had anything else on the sign it was probably something like the usual, on time, i'm really clean, honest, fair prices, etc etc etc. That will never work to increase sales in the plumbing business not to mention that if it was a yard sign that means that all of it was to hard to see while driving except maybe your business name.

If you did this on a sign which i'm sure you did it is guaranteed to not work, any marketing professional would know this.

To make it effective you need an offer, and not just any offer but a strong offer.

Mike

nealrm

11-05-2009, 05:43 PM

Huggytree is half right and so is handprop. This type of advertising would not be well suited for generating direct calls. Unless you are a gas station, hotel or restaurant you will not see a direct response to outside ads. Why, because by it nature you have to be outside to see the ad. That means you are probably not looking looking for whatever the ad is offering.

What this type of advertising is good at is name recognition. By repeatedly seeing a name you will subconsciously remember that name. So when you are shopping for that item, that name will sound familiar. Will the customer remember seeing the name on the trailer 100 times - No. Will they be able to tell you why your company was selected - No. Will the tell you that they picked your name from a list of 50 other companies in the phone book, newspaper, internet or other list - Yes. The question is why they picked your company.

Harold Mansfield

11-05-2009, 05:49 PM

I think the trick would be to advertise the right businesses. I live in a Condo complex now and one company does all the landscaping, but in other neighborhoods, and especially in S. Florida in more upscale areas, everyone has different landscaping companies and on Tue-Thu you would see vans and trailers from different companies all over the place.

You'd have to really know the area and market to target it right.
I think it could work...kind of a play on car, and taxi wraps. Especially in places that don't get any real winter so you have almost all year long ads running. (Arizona, Nevada, S. Cal, etc)

There was a company in Ft. Lauderdale that used to advertise "Free Snow Removal" on the Garbage Trucks. It took me the better part of a year to get it. (It don't snow in S.FL). For the longest time I couldn't understand how they could afford it.

Steve B

11-05-2009, 06:20 PM

Huggytree's experience is exactly the same as mine. It's a great idea, but after 5 years of doing this (and other) kinds of advertising I wouldn't pay a dollar for it.

I have a very nice $3,000 wrap on my van and it gets a lot of attention - although I'm sure it might not meet handprop's standards. I've gotten 1 call and zero jobs after two years from it. However, I still think it was well worth it because of the credibility that it gives me when I pull up to give a quote. It also builds name recognition with people that is hard to measure. I also have people that think I have a fleet of vehicles.

My yard signs on the other hand have done fairly well for me (and I don't even have an offer on them!). It's more a matter of implied referral since they see their neighbor trusted me with their dog fence.

handprop

11-05-2009, 06:37 PM

What I was addressing was the comment about how a sign doesn't work.

I did not make any comments if a sign should be used.

Good marketing practice is to determine what type of marketing vehicle is best suited to a specific problem, quite a different conversation. A sign is a marketing vehicle and once that's selected as a vehicle then a good marketer will determine the message, offer, etc.

If you asked me "would I have a sign poked in the front yard?" my answer would be "Sometimes", it's cheap and gives me a slight branding ability if designed and used with good marketing practices.

Would I expect a customer from the yard sign, no! Could I get a customer? yes. Would I want that type of customer? No!!!!!!

Many people depend on signs, truck lettering, and a yellow page advertisement and think they "Do marketing", at the very least it's laughable. Then when it doesn't work which is almost always true, they blame there own poor marketing solutions instead of there own ability to understand the real issue. Using this as the sole means of marketing usually produces poor customers, a well documented fact!

I use a marketing system that targets a whole different customer. None of this is a secret, marketing professionals are very aware of what I speak but the fact few business owners take the time to understand the difference between customers. They usually just complaine about customers and close the doors within 15-20 years, never able to reap the full benefits of a well designed company.

Guessing about a sign and if it's a good or bad idea is foolish when data to support these claims is easily available. Why reinvent the wheel, the solutions to these questions were answered hundreds of years ago. All we need to to is apply it.

I have personally owned and sold 7 companies and have made many mistakes during the process. One thing I never did was repeat them!!!

Mike

handprop

11-05-2009, 06:44 PM

Steve, I realize at times I may seem harsh and mean spirited but that's not my intention. We don't need to guess at marketing, anybody can have a business and squeek out a living, or have a decent business that even makes money. But to have a great business takes a complete understanding of the process. I didn't invent the process, i'm not even the slightest bit creative and that's fine because I don't need to be. I use prooven methods and rules designed by business leaders who went through the learning process.

Mike

greenoak

11-05-2009, 07:35 PM

huggy, im thinking your signs might be hard to judge....maybe the public is seeing them a lot....and when they go to the yellow pages to find a plumber, they think...hey i ve heard of him...
we pay a bit over 600 a month for 3 billboards and are so GLAD...
i sure dont think marketing decisions are easy or easy to research.... its more like gut and smoke and mirrors to me.... but we couldnt do without it...
ANN

vangogh

11-05-2009, 08:56 PM

The thing with signs on a van is you have to consider their function. Are they there so someone will write down your number as you're driving by and rush home to call or are they more of a branding mechanism. Someone sees your sign and 4 months later recognizes your name in the phone book and chooses to call you. They may not even remember seeing your van sign specifically when they call, but because they've seen it enough they think of you as the market leader or a trusted business or something else that gets them to call.

You can't really measure directly how well an ad or sign geared toward branding will work. You can measure it to an extent, but not directly on a one to one basis.

A sign on the side of your van with your logo and contact information seems like such a low cost thing, why wouldn't you do it. Unless you drive erratically to the point where people notice and that becomes the association with your brand I can't see how it hurts.

What I don't like is the trailer is being used/operated by some other business or person that I would have no control over.

That's a good point and is the major downside of renting out the trailers. You are relying on the person renting it to not act in a way that damages your brand. Unfortunately you have no control over that. Odds are you'd be fine, but it's something to consider.

Spider

11-05-2009, 09:18 PM

I think any advertising medium works -- if you put the right message on it. To say this or that type of advertising doesn't work, doesn't make sense. The trailer idea, the park benches, the keytags, magnets, doorhangers, painted roofs, yard signs, billboards and everything else will work - with the right message.

I wonder at the process of choosing the medium then deciding what message to put on it. I would expect a marketer to recommend the messsage then decide which medium will best deliver it. Horses and carts, don't you know?!

I never did any advertising for my plumbing company but plenty of promotion (all costing nothing but time) and turned over millions of dollars per year. And I never had a single call about unblocking drains and changing out a WC - because we didn't do that kind of work and those that wanted that kind of work didn't even know we existed!

I think it is important to know the customers you want, determine the message that will attract them and then decide the medium that will best carry that message. And not do any other advertising and promotion that will come to the attention of people you don't want to sell to.

huggytree

11-05-2009, 10:00 PM

Steve...i completely agree about credibility....you MUST have a well marked van to look professional...thats why I have it and always will....I can see your yard signs working better because people can see your work...people see you outside doing something to their neighbors house..they are curious...plus you are alittle more specialized...im guessing there arent 20 pages in the phone book with dog fencing like me w/ plumbing... i have remodelers who do additions...they get calls from the signs...their sign has no 'offer'...usually not as nice as mine....just the company name and a tag line.

Green Oak...I completely agree about someone seeing my name on a sign and then once again in the phone book...definately.....its hard to measure that one....but as far as the sign alone...nothing....i can see a bill board near an expressway exit working for you...when i used to go to antique malls Id randomly pull off the expressway for Antique signs........

handprop....im 3/4 lost on this 'offer' thing.....i need some examples to understand..
give me some examples using different businesses...your on whole other level of thinking of me....you sound very deep or something. i am lost...help me be found.

vangogh

11-05-2009, 10:12 PM

I would expect a marketer to recommend the messsage then decide which medium will best deliver it. Horses and carts, don't you know?!

Absolutely. The message has to come first and based on that message, which ultimately is your brand, you choose which mediums make the most sense to get your message across to people. You're right. Any kind of advertising can work if it fits with the message.

handprop

11-06-2009, 12:20 AM

Mark, start your on thread, we have a lot of work to do!:D

Mike

Steve B

11-06-2009, 03:26 AM

Hey Dave, I just checked out your website and took a look at your truck.

You're right, your name and phone number are huge. But, you have no other message on it (unless you have it on the back). Perhaps a catchy tag line or a something might help a bit - especially on the back when people have a bit more time to read it if they're stuck behind you at a light.

My van has a thing about my rechargeable collars and a photo of a dog catching a frisbee (showing off how happy the dogs will be). My van is visable in the video clip on my website if you're interested. I have the rechargeable collar in every advertising thing I ever do because nobody else has it and it's a huge benefit. Again, my van signage doesn't work any better than what you've done, so take this advice for what it's worth.

Also, you might want to put your website on your signature of this forum. I had to look you up on Google.

greenoak

11-06-2009, 07:47 AM

dh wont let me put anything on ours because the word antiques might attract robbery...
id love to see our 2 big trucks all decked out!!!!
ann

handprop

11-06-2009, 08:39 AM

I just went on your wesite Steve, that's pretty cool and looks like it would be a fun business. What type of marketing do you do to target pet owners?

Mike

huggytree

11-06-2009, 09:24 AM

Steve B,

the truck was lettered before i even passed my Masters test....So its 3 years old...Its getting faded and the back door is rusting....im planning on a redo next spring...im going to do a wrap on the back and add some extra advertising....possibly about water heaters since i can give a good price and still make good profit....

A new electrician friend of mine has a super hero wrap on the side of his w/ his face on the 'super electrician'...its extremely impressive...very memoriable....

ive thought about copying it....i had the idea of a mascot when i was designing my logo...my nick name was 'super plumber' at one of the companies i worked for years ago.

my slogan on the van is 'well treat your home like our own'...it was blah, but the best i could come up with at the time....

Paul Elliott

11-06-2009, 10:55 AM

I have personally owned and sold 7 companies and have made many mistakes during the process. One thing I never did was repeat them!!!

Mike

Mike, you were testing ... and using the results of your testing.

Testing EVERYthing is so important, but it is useless unless we collect and act on the data.

Paul

Paul Elliott

11-06-2009, 11:07 AM

i sure dont think marketing decisions are easy or easy to research.... its more like gut and smoke and mirrors to me.... but we couldnt do without it...
ANN

Ann, you just invalidated your own statement. You ARE researching and testing which is why you know you couldn't do without it. :D

It is far more scientific, as Mike suggested, than is generally recognized, but because we are dealing with human behavior, it simply appears to be inscrutable.

One of the best questions to ask of customers is, "Where did you learn of our business?" or "Who referred you to us?" yet it is amazing how seldom businesses do this. Like all other testing you must tabulate and use the results.

You can also ask your customers what they thing about your signage, your website, your logo, everything. Ask enough of your customers and they will help you understand what you should do next.

Any marketing dollar, the results of which cannot positively tracked, should be considered a dollar wasted. We should design all campaigns so that we can track the results.

Paul Elliott

11-06-2009, 11:11 AM

I think it is important to know the customers you want, determine the message that will attract them and then decide the medium that will best carry that message. And not do any other advertising and promotion that will come to the attention of people you don't want to sell to.

Excellent point, Spider! Too often we fail at the outset to properly identify our target customer. Having failed to do that, it's no wonder that things don't work. Wrong message, wrong medium, wrong person is too frequently the result.

Paul

Paul Elliott

11-06-2009, 11:17 AM

dh wont let me put anything on ours because the word antiques might attract robbery...
id love to see our 2 big trucks all decked out!!!!
ann

Ann, have other dealers commented that using the word "antique" attracted robbers?

Paul

handprop

11-06-2009, 03:00 PM

Paul, You are very right! I test everything. To not test a marketing method is nothing more than pre-school marketing. When people "Try" a marketing vehicle and "Just see" if it works it's almost always doomed to failure. The reason for this is 100% about testing. I'll give an example:

Here is how I and other professional marketing people design something simple like a gift certificate, or at least this is how I was taught.

Once the vehicle has been chosen, and in this case it's a gift certificate a marketer has to do some initial guess work as to what to put on it. The first round of designing the certificate I try real hard to make it close to what I think is an effective message, offer, etc. BUT, i'm not real concerned because I know that the power of the GC lies in testing and will take a series of revisions to get it correct.

For myself It's a little easier than most because I have designed so many that I can get fairly close on the first try. This may sound arrogant but is quite the opposite. Testing is the reason why I know what the GC should have on it. I know this because I have records of my experience that date back over 20 years. And these records indicate even the slightest change and the results that followed.

More important than the word testing is the word MEASURING, and a business that doesn't measure the results will be doomed to the averages and will never obtain greatness.

So in my records I know what I have done in the past, I know what works and what doesn't. I can get pretty close to knowing what makes a phone ring and what doesn't. Like I said above, the first draft is an experiment tempered by experience.

Once I have a first draft I need to be able to identify and track how the GC was distributed, who was responsible for distribution, and what type of person ended up with the GC. I do all my tracking on a spreadsheet.

On the first draft I have my printing company stamp a series of numbers one each certificate that allow me to control what gets logged into the spreadsheet. At this point i'm all set for my first round of testing, and measuring results. My goal on the first round is to first find out how strong my offer is. Once I give it time I can measure results. After a while I change something like the offer and repeat everything again, all the while keeping track and measuring results.

Eventually I end up with a gift certificate that maximizes my yield on every square inch of the certificate right down to the very last detail. Once I have these numbers in my spreadsheet and I know I months of changes, testing, and measuring have shown me great results i'm still not ready............

That's right, more testing.:eek:

Distribution is a crucial step in the marketing process. Distribution is a complex topic best explained on another thread so I won't explain that, but it does get at a much deeper marketing issue. Distribution is the step I use to create the type of customer I do business with.

You can create a great marketing vehicle but if distributed poorly and not tracked for effectiveness all the work that went into the design could bear little fruit.

Mike

Steve B

11-07-2009, 05:09 AM

I just went on your wesite Steve, that's pretty cool and looks like it would be a fun business. What type of marketing do you do to target pet owners?

Mike

It is a fun and very rewarding business. I often have people tell me it was "the best thing they ever did"... very often I'm told this.

I have an extensive marketing plan - with several methods and mediums being used. I'm in a cut throat industry so I don't discuss many details on a public forum. As you can see by my website however, a lot of money and time was invested in it (all done by VanGogh). I get lots of positive comments about the website.

greenoak

11-07-2009, 08:51 PM

hey paul!!! yes antique would be a bad thing.....most of us believe that anyway......because of the concept that there would be something real valuable in the truck.....some people do shows with thousands of $$$$ of inventory...... ......like my watch buddy, his cases easily carry $20,000 of old gold and watches...who knows maybe lots more....he might have lots of 1000$ watches or diamonds.... and he hauls them from show to show....he wouldnt want antiques on his car...

back to marketing....we are having the best christmas openhouse ever....somehow....and i cant track it....i do ask where they heard....our email is the main thing i guess....we spent quite a bit on newspaper and radio too...
im trying to work facebook better.... ive only been on 2 months......hard to figure,...did i pick better stuff or were the ads that much better?....anyway they were buying really well today...
ann

Spider

11-07-2009, 08:57 PM

Love to hear of your success, Ann. Super job! Well done!

greenoak

11-08-2009, 10:52 PM

thanks....it was pretty good...ann

huggytree

11-09-2009, 09:03 AM

GreenOak,

In a up economy I can see antiques being a luxury item for people w/ extra cash...

in a down ecomony if you advertise correctly i can see it as a way to get better quality items for a lower price....

we have all 100 year old bedroom sets for our kids....we paid $200 per dresser and $200 per bed, but got solid hard wood which will never go down in value...vs $500+ per item for particle board which will end up in the garbage in 15 years

I stopped collecting antiques because anything else for me is a luxury item...plus i couldnt find the stuff i like anymore(1900-1915 oak)

greenoak

11-09-2009, 09:13 AM

good points huggy....and we have both to offer....
im all about a down economy...my best words now are....save money with style....
but we also have some big fabulous pieces only the well heeled could consider...
oak is king here too .
generally im not about antiques with most of our customers..... we are about half new and half old now...
ann

Paul Elliott

11-10-2009, 12:49 AM

Mike, thank you for this excellent description of an effective process.

Distribution is a crucial step in the marketing process. Distribution is a complex topic best explained on another thread so I won't explain that, but it does get at a much deeper marketing issue. Distribution is the step I use to create the type of customer I do business with.

By creating "the type of customer," to what are you referring? Do mean that you better define your target customer in this process?

Thanks.

Paul

vangogh

11-10-2009, 02:30 AM

Mike when I think distribution I think the means by which you get your product to your customer. Are you saying that the how you get your product to your customer helps define who that customer is?

For example distributing a product by placing it on the shelves at Walmart attracts a different sort of customer than having that same product at Bloomingdales. (Do they even carry similar types of products?)

I would think the market comes first and then based on the market you would choose distribution so best to reach your market. Maybe I'm misunderstanding what you meant and if do have this right I can kind of see where you might be coming from. Still it seems to me the market comes first unless you already have a strong source for distribution, in which case you might develop products specifically for that source of distribution because you already know it reaches a certain market.

Hope that's making sense.

Spider

11-10-2009, 09:27 AM

VG - it seems to me that Mike is referring to the distribution of the advertising - a gift certificate, in this case (post #27 of this thread.)

What has me a little baffled with regards testing and measuring advertising - and I can certainly see the efficacy of it all - is how can this relate to small business advertising. I can see testing and modifying and testing and modifying again in small segments of one's total market before a massive marketing effort: however, a small business can only afford to (and perhaps only needs to) advertise to a small area and limited number of people. To segment that small area into even smaller segments for testing reduces the number tested to numerical insignificance.

I'm sure Coca Cola would consider a market test costing $30,000 to be a very small test, but $30,000 to most small businesses (micro-businesses, really - 1- or 2-person companies) would likely be the total advertising budget for a couple of years or more.

I realise testing and measuring is important, but it does seem to be unreasonable for small- and very small businesses. Don't you all think?

vangogh

11-10-2009, 12:15 PM

My bad. See what happens when I skim posts instead of reading them fully. :) Makes more sense now.

Frederick I think small businesses can still test. Maybe not to the same scale as a big corporation, but you can still test things. In fact what Mike described earlier doesn't need a huge budget. The key was to stamp each gift certificate so you could tell them apart and keep track of how that gift certificate makes its way to potential customers and if and how it makes it back.

Something relatively simple. Say you want to see if you're getting better results from an ad you place in a coupon book and one you place in a magazine. Make sure each does something different from the other. Perhaps it's a coupon code that needs to be entered or maybe the coupon itself needs to be handed to you. Or use the coupons to direct people to a website. Each variation could have a similar, but slightly different URL.

If you keep the differences simple you shouldn't have too hard a time measuring which coupon (the one in the book or the one in the magazine) delivered better results.

With a website there are now so many free and low cost tools that you can test changes to your site and you should be able to test and measure your marketing that flows through your site at some point. At least the parts that flow through it. Small business may not have the same funds to spend on testing, but there are plenty of things that can be tested at low cost.

Steve B

11-10-2009, 06:01 PM

"To segment that small area into even smaller segments for testing reduces the number tested to numerical insignificance."

Frederick - you are absolutely right about the lack of significance when the test is too small. In order to be statistically significant (i.e. meaningful) the sample size usually has to be so large that a small business operating in only one or two towns can't likely get a meaninful result even if they had the money to spend. If you do a test that you can "afford" but isn't statistically significant can lead you to bad decisions based on random fluctuations in data. Most "marketing" people are clueless in statistical knowledge. This really leaves us small guys going by our gut instinct after asking a few friends what they think of something.

To give a specific example: I wanted to test a direct mail campaign. I went back to my text books and calculated that I needed a sample size of over 2,000. If I wanted to test two different kinds of marketing pieces - that would be a total of 4,000. At roughly $1 each for the envelope, postage, list of addresses etc. - that's $4,000. I wasn't willing to spend that much on a test - so I picked the one I thought would be most effective.

handprop

11-10-2009, 08:37 PM

Testing is everything, size doesn't matter, results do. A 30,000 sample size is needed for certain things but not for what I do. Let me see if I can clear up any confusion about how I do things, but keep in mind I do things different than most.

OK

Experience has taught me that I don't want strangers calling me from a yellow page advertisement, and that's why I don't have one. I hate strangers, they always get bids and are cheap, why would I market to them. This type of customer I leave for the competition to fight over.

Word of mouth is key to a better customer, so I spend zero time dealing with strangers and all my energy is spent turning past customers into my army......they advertise for me, and I see to it they do. This is nothing new of course but it's funny how people in service based business do nothing to cultivate this group. All my testing is within this group only.

All I care about is what rate my past customers get me new customers. These are not STRANGERS but are now PROSPECTS. When a past customer finds me a PROSPECT it's money in the bag, every time!!

Mike

Paul Elliott

11-10-2009, 08:43 PM

Word of mouth is key to a better customer, so I spend zero time dealing with strangers and all my energy is spent turning past customers into my army......they advertise for me, and I see to it they do.

Mike, share with us some of the techniques you use on your customers to get the results you want.

Thank you.
Paul

handprop

11-10-2009, 08:43 PM

OH, I didn't mention my sample size.

I can test market 20 past customers and get great results. A small service based company is much different than a Fortune 500 company......so why would you market the same way, that simply doesn't make sense. When a large company needs a 30,000 sample size that's because they market to the masses, I have no interest in that.

Mike

handprop

11-10-2009, 08:57 PM

I would be happy to share anything I can.

I have to fire off a bunch of emails tonight, when I'm done I'll tell you a great story about a fellow I helped out in New Zealand who was convinced the newspaper was bad because he never had any luck with his hardware store trying to sell Bosch dishwashers.

Mike

Spider

11-10-2009, 11:37 PM

...I can test market 20 past customers and get great results. .. Here's where you lose me, Mike. What can a test possibly tell you with such small numbers?

You have 20 past customers. You want to test the wording of an offer. You "market" to them XYZ. Then you "market" to them again with XYY (different wording.) You got 2 responses first time and 4 responses second time.

Does that mean the second wording (XYY) was better than the first wording (XYZ)? Does it mean the XYY gave me a 100% increase in response?

It seems to me that such a small test does not tell me that, at all.

I could read it that the day of the week made the difference, or the weather, or the news.

If I marketed to the same people second time round, I could read it that being reminded of the offer gave me the increase in response, not a change in wording. If I mailed to a different set of people, I could read it that the differences in those people produced the different result.

What I'm getting at, with such a small test, other minor matters become significant in affecting the result, which would not happen with a large test.

Am I missing something?

vangogh

11-11-2009, 02:26 AM

You might be surprised at how small a sample size you need in order to be very confident in your results. Think about political polling. They can ask as few as 1,000 or so people who they're voting for and use that to say what % of voters will choose a candidate. When you consider how many voters there are 1,000 is a very small % of the population being measured. We all know those polls aren't perfect, but they are pretty good when you consider how few people are being asked.

Here's a sample size calculator (http://www.surveysystem.com/sscalc.htm) I found that helps you determine what sample size you need to test to get meaningful results. It also has some definitions and examples to help in understanding how the calculator works.

20 responses might not be enough, but there are ways to increase your confidence in the results. For example you could have sent out the first offer 3 or 4 times to see if each time you got back those same 2 responses. If you did and then your new offer received 4 responses you probably can conclude the wording in the second offer was better. Maybe sending out each offer once to 20 people isn't conclusive, but sending each offer to those same 20 people several times each could be more conclusive.

Steve B

11-11-2009, 03:30 AM

That calculator is a good tool and the results don't surprise me at all. It confirms what I was saying. I used it for a small town of 10,000 and a city of 1,000,000 and it requires around 1,000 responses in either case to be 95% confident in a result. A lot of small businesses don't have the time or money to test something to that extent. And when so many marketers preach that you should test things - I never hear them talking about the importance of doing it properly. I'm guessing most people may ask 20 or 30 people and consider it "tested" then they draw conclusions based on erroneous data.

This doesn't even take into account controlling other variables such as the day of the week etc.

Testing is extremely beneficial and can prevent you from wasting a lot of money, but doing it without understanding it can be just as wasteful.

handprop

11-11-2009, 08:42 AM

I was going to post last night but it ended up getting late. I'm running behind this morning but i'll make a quick comment.

First off, sample size depend on what type of business you have, and what type of customer you are trying to reach. McDonalds is in the sample size business.

For a small service based company the sample size can be quite small. One reason people feel they need a large group is because the initial offer is so weak it requires a big sample. If you have a very strong offer the sample size can be small or sometimes 0. Even a taking a large sample has it's issues because the extracted data can be false, just ask Coca Cola. All in all, I run on experience and in many cases it becomes easy to see how an idea would yield a poor result. Like I said, show five people a strong offer and watch the reaction.

If you own a small business it's crazy to think you can experiment with 1,000 or 2,000 people, that's clearly insane. A small business needs to look at marketing through an entirely different lens. A small business can get buy with a small group as long as the group is targeted to people who are ready to buy right now.

That's why I just refuse to read any more books on marketing, most books are either written by people with a big corporate mentality, or by anybody wanting to make money selling books. I have meet many authors over the years including authors from colleges like Harvard, and Wharton school of business. Most of these folks are very experienced but the experience is with multi-billion dollar companies. This type of marketing, in most cases, doesn't apply, and they will also admit that!

When I gave up reading and started doing my own research it changed my life. What's worse is people selling marketing online. I'm not saying it's all bad but most of it garbage. The truth is the customer will tell you exactly what you need to do but it requires a business to pay close attention.

If you have a weak offer and service the customer poorly, no amount of data can help. The real issue is most business don't understand what a strong offer means. Customer service is no different, people don't really understand what customer service is. The proof is all the books written on this subject and yet customer service is at an all time low..........

If I have time tonight I tell you the story Duncan in New Zealand and you will understand what a strong offer is and how it can change the entire dynamics of a business, and why sample size becomes almost worthless.

Mike

greenoak

11-11-2009, 09:13 AM

i agree with a lot of above.i dont want big guys who dont fit my budget and wish they had a bigger company to work with and naturally look down on us........ or little guys with theories and little more......but ...
i still cant see an easy way to test ... say i do ; radio, email, snail mail, and papers and facebook...we did all that last week....btw...dont say coupons , tried that, . my customers do not respond to coupons, we are too busy to ask more than a few where they heard about us.....
so im out here making wild guesses!!!
i know the billboards are good, because i hear about them all the time...but the ad campaignes like we just did for our open house ,,,i just havent figured out a way to test the seperate parts......as a whole it worked great...over 800 sales...so probably over 1000 people thru and most signed up for our email, due to the drawing...we mailed to 3800 and had 1000 come but i cant give all the credit to the mail...etc etc
thats my delimma...hoping for a big eureeka here for me...lol
im happy with our marketing ...but could be happier..:cool::cool:
ann

handprop

11-11-2009, 09:30 AM

Fredrick, Vangogh hit on a good point but let me take it further.

The first two examples you mentioned doesn't matter if the offer isn't strong, that would just leave a buisiness confused by the results of the data.....so yes you are right.

Better results are achieved through a better offer. The question will always come down to the offer. Imagine an offer so strong that a stranger can't refuse. Notice I said stranger and not prospect.....BIG difference! Now how big would the sample need to be.

Just don't get confused by what an offer means, it's not always "Here is a check for $100", yes it's a good offer for most things but an offer can be something much different like Ann does with her antiques. She creates a total experience, a culture if you will. That is a strong offer but goes unnoticed by the competition. If I lived in her area and wanted to buy antiques I would shop with her 7 ways from Sunday. That alone doesn't build a business because the total package is what's important but from experience I could easily see she is much smarter than she may realize. Now go look at her competition. I'm willing to bet they don't hold a candle to the culture she creates.

And that is just 1 sample of a strong offer. An offer like that can't be printed on a piece of paper because it's something that needs to be experienced. I'll find time tonight to write about Duncan and i'll show you an offer so strong his competition folded.

Here is something to think about. Duncan owns a hardware store (much different than what we think of as a hardware store in the U.S.). He wanted to sell the extra inventory of dishwashers but had a real hard time. Duncan was using the local newspaper and kept trying to improve his advertising, with professional help, but nothing really worked. What would you do? What advice would you tell him? He blamed the newspaper and said that people just don't read them anymore, is he right?

Think about this, and tonight and I'll tell you the approach I took to the problem.

Mike

handprop

11-11-2009, 09:34 AM

Ann, just read your post.....Your very right!

But don't quit on the coupons, they are great if used correctly. Explain to me how you used them and what they said, or better yet post a picture. Coupons can have real power but they are usually abused and the marketing chain is broken when used the wrong way. Share your story and lets talk about it.

MIke

Spider

11-11-2009, 10:29 AM

Not wishing to appear contrary (but it's a good way to learn stuff!) -- I don't think the comments following my last post answer the question.

VG spoke of sending the same offer 3 or 4 times to the same 20 people before sending another, different offer, to those same people. If the 2 responses from each offer are from the same 2 people each time, I must conclude that they are so keen they would have bought anyway without the offer. If the two responses each time were from different people of the same group of 20, I must wonder why the previous responders didn't respond again. If they didn't respond because they didn't need what was offered again, then the numbers change, because the second iteration was really only to 18 people, the third to 16 people, and the fourth to 14 people only. Meaning the first offer results were improving steadily simply by sending it out repeatedly. (2/20, 2/18, 2/16, 2/14....)

Now we come to the re-worded offer - and we get 4 responses. Is it really indicative that the wording of this offer is better? Might something have happened in the day-to-day environment of these 20 people that there would have been 4 responses to the previous offer? We will never know. Might something have happened that would have produced 6 responses to the first offer but we only got 4 responses to the second offer and, in truth, the wording of the second offer was worse?!

It still seems to me that we are working on guesswork. Maybe the results can be a best-guess guide but I cannot see this as being very scientific - unless you are using such huge numbers that the miriad of uncontrollable influences become insignificant.

Keep talking, guys - I'm not trying to convince you'all of anything, I'm wanting to BE convinced.

vangogh

11-11-2009, 12:58 PM

I used it for a small town of 10,000 and a city of 1,000,000 and it requires around 1,000 responses in either case to be 95% confident in a result.

So you're saying every person in town and in the city has a pet and is open to the idea of a fence and is part of your target market? More likely the population is lower. Also know that you can still sample less people. The more you can sample the more confident you can be in your results, but you can still draw some conclusions with lesser confidence in the results.

But even assuming that population is right, you could send out a postcard or similar to 1,000 people and be able to feel confident that if you sent that same postcard to another 1,000 people you'd get the same results. That's not a huge sample if you're considering 1 million people as your market.

@Frederick - I guess with 20 people it would depend on the offer. For example say I offered 20 clients 50% off to redesign their sites and 2 took me up on that offer. If I sent the same offer out a month later it's highly unlikely those same 2 people are going to take me up on it again so I'm really sending the offer to 18 people like you suggest.

I can't think of one offhand, but say I did have an offer that people might reasonably purchase each month. In that case I do think even a small sample of 20 people yields significant results. In fact if the idea is to only market to 20 existing clients then a sample size of 20 is 100% of the population.

The main idea to me is that none of us need to send out offers to tens of thousands of people to draw any conclusions. I've taken comments by 2 or 3 clients and used those comments to draw conclusions about other clients and potential new clients in the past and it's helped my business to grow.

handprop

11-11-2009, 04:31 PM

I have a quick second.......

Vangogh is 100% on target

Keep in mind though, I don't do things like blanket an area with a post card and measure results, that is poor marketing for any company other than one selling a commodity. Again, all these types of tests depend on the company and in most cases belong with the great big corporations. The small business owner doesn't have time because they play an active roll in the operation and in most cases are busy doing the actual work. To use marketing systems like Ford Motor Company uses would be foolish and my advice is to stay away because you will drive yourself nuts trying to figure something out that can't be answered.

But lets back up a bit, if I wanted to sell dog houses, what then? Well, Like I said earlier, the wrong way is to blanket and measure. The larger the sample the worse the result!

The correct way, or what I would do, it to directly target pet owners. But not just any pet owner, I would target dog owners that don't have a dog house, and keep the dog outside. Once I find this group I could sample just a few of them and find out just how strong my offer is. Trying to find out how strong an offer is with a group of people who don't own a dog or who already own a doghouse is foolish.

Please keep in mind however not all business can be treated this way, every business has it's own set of rules and characteristics we need to look at independently. If I sold toothpaste the entire population would would yield great results and a large sample group is great, and creates insurance for us to hedge our bets. But what if I sold toothpaste that has low acidity for cancer patients trying to get their body in an alkaline condition? Could I use the entire population as a sample group? Would I be better off sampling just cancer patients? Would I be better off sampling cancer patients with stage 2 cancer? OK, would I need many of them to get an accurate result to test my offer?

In the end our goal is to seek out the true customer, sample this group and you have yourself a sure winner!

Mike

Spider

11-11-2009, 04:33 PM

...The main idea to me is that none of us need to send out offers to tens of thousands of people to draw any conclusions. I've taken comments by 2 or 3 clients and used those comments to draw conclusions about other clients and potential new clients in the past and it's helped my business to grow.This is really what I'm getting at. I understand "testing" to mean that a scientific result is obtained which can be used to determine future results.

You "take comments" from 2 or 3 clients, VG. You draw conclusions and apply those conclusions and your business grows. But I see no necessary connection between the two events. Did you do nothing else to make your business grow? if you did other things, you cannot assume that the conclusions from your 2 or 3 clients' comments was the cause of your company's growth.

If you had ignored your 2 or 3 clients, but everything else remained the same, can you honestly say your business would not have grown? If you cannot say that, then your clients' comments and your conclusions had no bearing on your growth.

It's guesswork - and I see testing as a means of avoiding that error. How a small business can test remains the problem for me.

handprop

11-11-2009, 04:36 PM

One more thing I forgot to mention

That's also why I when I hear people say "I tried this and it doesn't work, trust me" I just laugh. Always know your group, testing is only valid when it's tested on the group that matters......you know.....the small group.:D

Mike

vangogh

11-11-2009, 08:56 PM

The correct way, or what I would do, it to directly target pet owners. But not just any pet owner, I would target dog owners that don't have a dog house, and keep the dog outside. Once I find this group I could sample just a few of them and find out just how strong my offer is. Trying to find out how strong an offer is with a group of people who don't own a dog or who already own a doghouse is foolish.

Exactly. The more targeted the sample the better the results. Which is why I'm always suggesting that people should learn more about their market and understand who their customer/client is. The more you can know about the people who buy from you the better you can do every aspect of your marketing and even the creation of your product and service.

You'll spend less because you don't need to cast as wide a net. Businesses that think their customers are everyone have to cast the net as wide as possible which drives up the cost of everything. Focus instead on a smaller group of people who closely represent your ideal customer.

This is really what I'm getting at. I understand "testing" to mean that a scientific result is obtained which can be used to determine future results

That's a fair point and I do agree. I'd add that by testing we're not being 100% scientific. That might take too much resources to achieve 100%. You can go after 90% or 95% confidence in your results and still act on them. Success often comes down to risk and reward. That confidence level is the risk and you have to decide to act on it or not. How big the reward is the other side of that decision.

You're probably not going to risk something you're 5% confident about for the potential of increasing your revenue 2%. You might risk that same 5% confidence if the reward was to increase your revenue tenfold.

You do increase your confidence level by testing more people, but you don't need to test as many as you might think to reach levels of confidence you'd be willing to act on. Maybe that's not completely scientific. I don't think it has to be. We're business people and not scientists (though we could be both I suppose).

Getting back to Mike's point about targeting a better sample. If you're trying to predict the behavior of the entire population then you need a fairly large and random sample. Let's say you only want to predict the behavior of women. You've cut your population roughly in half. Say you want to predict behavior for women living in small towns in the United States who are married, have at least 2 children, and rent a home. Think of how many less people you now need and want to sample.

Did you do nothing else to make your business grow? if you did other things, you cannot assume that the conclusions from your 2 or 3 clients' comments was the cause of your company's growth.

Yes and no. I did several things around the same time, but all were based on the comments of a few of my clients. I used their comments to essentially build personas for who my typical client is. Then I rebuilt my website, and tailored my services for those personas.

So yes I did quite a bit, but everything I did was based on comments by a small sample of my existing clients.

handprop

11-11-2009, 09:18 PM

BINGO......well said!

Mike

handprop

11-12-2009, 01:22 AM

I said I would tell the story of Duncan and explain in further detail the method to my madness but it's after midnight and i'm really tired. Sorry about that, the political season is hitting hard right now and i'm behind schedule. I enjoy reading everyones posts and wish I could participate more but but it's just difficult until the 2010 Senate elections are over. I hope I can find time in the next few days and until then I hope you all have a good week.

Mike

vangogh

11-12-2009, 02:33 AM

Thanks Mike.

Umm...politicians? We're more important than some politicians. C'mon how important are Senators really? It's not like they have anything important to do at the moment :)

We want the story of Duncan.

Spider

11-12-2009, 11:41 AM

This is making more sense now. Mike and I were posting at the same time so I missed his post (#54)

Now arises a learning problem - how many small and micro-businesses zone in on their market as finely as "cancer patients with stage 2 cancer"? (Not stage 1, not stage 3 - only stage 2.)

-- Would a giftshop advertise only to "ladies who have immediate family with 8 members"? (Thinking that such people buy more gifts than people with smaller or larger families.)

-- Would an advertising agency only advertise to "retail businesses with 14 employees"?

I can now see the argument for small number testing by companies selling to a finely defined and extremely small niche. What about small and micro-businesses with a more diverse market - convenience stores, giftshops, shoe shops, clothing stores, handymen, home repairers of all sorts, Realtors, bookkeepers and accountants, restaurants.....

Is small number testing appropriate for them?

handprop

11-12-2009, 04:46 PM

You raise not just a great question but a required question. It also raises a very important factor in how we design a marketing system. Let's take a convenience store as an example. Here is a case where the the company has a mixed product and each product can be unrelated to each other. This uncovers yet another question.

Let's step back and really think about this for a moment. One problem companies tend to do is use standard marketing vehicles that everyone uses for every type of company. Look how different a convenience store is from a toothpaste mfgr, it's night and day right? OK, so why are people marketing the same way for both types of companies, that doesn't make sense. Would a lawn service use the same vehicles as a gas station? Of course not, but people still do. Those of us who understand marketing all know that you can't market them the same and have similar results, so the key is to design a very customized marketing system built around specific characteristics of an individual company.

OK, we all know this already so let's not beat a dead horse. BUT, the question is about testing so my answer is how can testing be the same also? The answer is it can't!!!! On the topic of the toothpaste for cancer patients we know it's more cost effective to find a select group (the buyers) and test them with a vehicle, offer, etc..... The test sample can be much smaller right? OK, so what about the makers of Crest Toothpaste? it's bigger because the market is bigger. So what about the convenience store? At first glance it appears we would need to survey the local community and that would be a large sample number right? If that's true they would fall into the category of Crest. I don't agree, my opinion is that's the wrong GROUP to sample. So what is the right group?

The right group to sample is not the local community but the ACTUAL customers that buy from you, a much smaller crowd. Remember when I said this leads to even a greater question? Well, what I mean but that is the question of accuracy. Numbers only matter when their accurate, and the local community produces opinions that do matter but are less accurate than an actual customer. A customer on the other hand has already bought something from you.....and a smart business should know why! The accuracy of testing in this group of CUSTOMERS can, in many cases, help you create a much better marketing system.

Every company is treated different and a convenience store is no different. A convenience store has a different set of customers than a grocery store and the marketing should reflect that as well as the testing. Keep in mind the owner of small specialty store doesn't have the time or resources as the owners of a grocery store would so the system of sampling is quite different.

One example of a big company that made a similar mistake is Coca-Cola when they introduced the "New Coke", they tested the wrong group in hopes of gaining market share. Had they tested actual Coke drinking customers the solution would of been a little different. They learned a lesson and went back to pushing the product they already make. How many Coke drinking customers would they have to sample to get an answer to the new Coke? I bet if they lined up 100 coke drinkers almost all of them would say they hate it. Instead they sampled thousands of people that don't even buy the product in the first place.

Thanks for raising such great questions, it's stuff like this that makes me get up in the morning. I just love stimulating conversation.

OK....I have to get back to work now.

Mike

handprop

11-12-2009, 04:55 PM

Thanks for asking complex questions Spider, keep questioning stuff like this and we can all walk away a better marketer. Just drumming up questions like this keeps us all sharp, when I don't think about something for a long time I tend to forget it.:D

Just remember, marketing has no right or wrong answers!

Mike

vangogh

11-12-2009, 08:03 PM

Great questions Frederick. Mike's point about testing existing customers goes right to the heart of it. Those are people that have bought from you or hired you. They are your market and there are more people like them who'll respond similarly.

I doubt most businesses are going to market to that fine grained a group. I used my example more to give a sense that you don't need to test as a large a groups as first seems. What I try to do and this really isn't testing per se, is to get to know my clients as much as I can. They're all different people, but they have a lot of similarities between them. The more I can understand them, the more I can understand why they hired me and then I can highlight those things in my marketing to attract more people like them. Not exactly testing, but I think there are similar things going on to what I do and this discussion.

One of the reasons I like working online is because it makes measuring results so much easier. As an example you can run AdWords for a few days to collect information about what keywords people use to visit your site. Then you can refine your campaign around some of the better phrases. You can consistently run and test ads against each other and have meaningful results in a short time (the more you're willing to spend the quicker the results). Over time you refine things to a degree where you have a very positive ROI.

Would a giftshop advertise only to "ladies who have immediate family with 8 members"

They could, with the understanding that the results would only apply to similar people. Then could then run an ad toward single men and measure those results as well. Comparing the success or lack of success between the two tells them a lot about who their customers are.

Would an advertising agency only advertise to "retail businesses with 14 employees"

Maybe not 14 employees exactly, but over 5 and under 50 say. Again the results couldn't then be extended to businesses over 100 employees or businesses where the owner is the only employee.

When I first started my business I knew I was targeting small business, but small business has a lot of variety. Over time I realized micro businesses were more my target. I think I'm a good fit working with them, where I'm probably not as good a fit working with a business that has 90 employees. Still a small business, but a very different kind of small business. To a degree that was simply a choice on my part. I could have decided I wanted to go after the bigger small businesses. In that case I would have tailored my services and marketing differently.

In the case of the ad agency marketing to 14 people businesses some of that is a choice. Once chosen though, it defines a lot of things. Some might disagree with me, but I think part of defining your market is refining who you want to be your market.

Mercedes and Hyundai both sell cars. They clearly sell to very different markets though. Somewhere along the way a choice was made by each company which market to go after. I don't think either first built their cars and then looked around to see who was interested. Conscious decisions early on led each company to make further decisions about what kind of car to make and who would be interested in that kind of car.

Once they've built a profitable business each can move into other markets. Nothing is stopping Mercedes from also selling a low end car. They probably wouldn't want to do it under the Mercedes brand, but they could buy another company or launch a new brand.

handprop

11-12-2009, 11:42 PM

Not to change the subject but do you remember when Cadillac decided to take a Chevy celebrity and put Cadillac emblems on it...........total failure and damaged the Cadillac image for a few years. I wonder what testing went on behind the scenes, was it a small group or a large group? I have no idea I just no Cadillac would like to erase it from the history books.

Mike

vangogh

11-13-2009, 02:17 AM

Funny I almost brought up Cadillac and Chevy in my post above talking about how GM is going after two markets. That emblem thing is exactly what I was thinking when I mentioned Mercedes not wanting to sell a low end car under the Mercedes brand.

I bet GM was thinking if they put the Cadillac emblem on the Celebrity it the emblem would carry the Cadillac brand to the Celebrity and uplift the Celebrity brand. Unfortunately it worked in reverse and the Celebrity pulled down the Cadillac brand, which actually makes sense since a brand is only as strong as what it represents.

Spider

11-13-2009, 12:11 PM

While we are on this little diversion, let me question the generally negative remarks about The Coca Cola Co. and New Coke. The company did some extensive taste testing with - and I take Mike's word for it - non-coke drinkers. They found a common preference for the New Coke taste.

Well, that wasn't so bad because I see New Coke is still around and the company has another blockbuster product. They nearly lost a lot of existing customers by stopping production of old coke, but the marketplace won and the company brought back Classic Coke. Now the company has rwice as many customers. Had they only surveyed their customers, New Coke would not have been born and the company may have been overtaken by Pepsi as #1 soft drink producer. It seems to me the New Coke/Classic Coke story is a masterpiece of marketing. I'm sure they will be discussing that in business colleges around the world for years to come.

Can we small business people learn from that, too? Of course - test your existing customers as this thread is advocating, but still test non-customers, as well. Don't you think?

Spider

11-13-2009, 12:35 PM

Paul Elliott

11-13-2009, 12:37 PM

i still cant see an easy way to test ... say i do ; radio, email, snail mail, and papers and facebook...we did all that last week....btw...dont say coupons , tried that, . my customers do not respond to coupons, we are too busy to ask more than a few where they heard about us.....
so im out here making wild guesses!!!

Ann, I would urge you to do whatever it takes to avoid being "too busy to ask" EVERYone. That is one the best ways you can test under your circumstances. See that each sales person has a card with the campaigns listed so he or she can make a tick in the appropriate column as the sale is made.

Failing to do this (or some form of testing) simply leaves you wasting money and not knowing what is and is not working.

You marketing is a business asset or a liability. Failure to properly assess your marketing puts in the liability category -- at least to some degree.

Paul

Paul Elliott

11-13-2009, 12:45 PM

Where do we go from here? Round up some "better" people without knowing whether they would buy from us or not, and survey/test them? What's the chance we would get a useful result from that approach?

A very useful solution to this dilemma is as follows. First, carefully demographically profile the customer you would like to have. Then, find those businesses who have those customers. Assuming they are not your direct competitors, approach them to do an endorsed mailing of your product or services.

Paul

vangogh

11-13-2009, 12:47 PM

Is New Coke still around? Maybe it is, but I can't recall having seen it since shortly after the debacle.

Some speculate that the whole Coke/New Coke thing was only a ploy to ultimately sell more Classic Coke. That could be true, but it's just as likely Coke made a mistake that in the end worked out well. If anything I'd say the lesson is to listen to your customers since the success here was that Coke did listen and brought Classic Coke back.

Something like this only works if you have a product with a long history and a very loyal following. I don't know that most of us small businesses would have a large enough following for something similar to happen, though we could certainly develop that kind of loyalty.

Can we small business people learn from that, too? Of course - test your existing customers as this thread is advocating, but still test non-customers, as well. Don't you think?

Absolutely. Just know testing non-customers means moving into new markets. That could mean you need to develop a new product or service to capture that market. And if you change existing products and services to go after new markets you do run the risk of alienating your existing customers. That's not necessarily bad or good. The new market may turn out to be better for your business. It's only to say you have to factor in that risk.

Spider

11-13-2009, 02:15 PM

...First, carefully demographically profile the customer you would like to have. Then, find those businesses who have those customers. Assuming they are not your direct competitors, approach them to do an endorsed mailing of your product or services.Yes, Paul - I have heard people recommend that before but never seen it work in practice. The other business is never willing to risk recommending someone they do not know. Even when one is known (as in being a customer of or supplier to them), I have never found anyone prepared to "risk" the recommendation.

Their argument, of course, is "If you foul up, it's my reputation on the line - I will not put my reputation in anyone else's hands."

Another one I have heard is, "My customers know me for the service I provide. Your product or service has nothing to do with that subject, so it would be inappropriate for me to recommend it." And, of course, if the services/products are similar, they will argue that they could supply it themselves.

Even promising a reciprocal arrangement has never, in my experience, swayed them into agreeing. (Even if the two companies have a similarly-sized mailing list, which normally they would not.)

Have you honestly done this for yourself, Paul?

Paul Elliott

11-13-2009, 03:20 PM

Yes, Paul - I have heard people recommend that before but never seen it work in practice. The other business is never willing to risk recommending someone they do not know. Even when one is known (as in being a customer of or supplier to them), I have never found anyone prepared to "risk" the recommendation.

In fact I have used this very successfully especially at this time of the year. (See below.)

Their argument, of course, is "If you foul up, it's my reputation on the line - I will not put my reputation in anyone else's hands."

Likely the mix or the offer were not good.

Another one I have heard is, "My customers know me for the service I provide. Your product or service has nothing to do with that subject, so it would be inappropriate for me to recommend it." And, of course, if the services/products are similar, they will argue that they could supply it themselves.

Likely the mix or the offer were not good.

Even promising a reciprocal arrangement has never, in my experience, swayed them into agreeing. (Even if the two companies have a similarly-sized mailing list, which normally they would not.)

Have you honestly done this for yourself, Paul?

As a matter I have done this for several clients. One example is that of a business attorney who handled special tax issues. He wanted access to the clients of several CPAs who specialized in small business accounts. They knew of him and he knew of them, so they were not strangers.

He approached them offering to bear all the expenses of sending his mailing to the CPAs' clients.

Steps:

1. CPA's endorsement letter to clients -- Text to the effect of ...
"I am very thankful for your business and have been looking for a unique and valuable Thanksgiving gift for you. Yes, I could have sent you a fruit basket, candy, ham, or smoked turkey, but I found something worth much more and of unique value to you and your business.

Your gift is a 30-minute specialized, business tax legal consultation ... at my expense. That's a gift consultation worth $150, much more than even a smoked ham.

I know Mr. Attorney and have confidence in his ability and knowledge of the tax needs of small businesses.

To claim your gift, call Mr. Attorney and give his receptionist your phone number. He will set up a time for you to call him when he has an uninterrupted 30 minutes to consider your questions. Of course, since this is in addition to his regular schedule, he may ask you to call him during the evenings or on Saturday.

You can have confidence in his advice, BUT there are absolutely no strings attached. He will give you his opinion about the next step and you can go to any attorney you wish.

If you like what he has to say and decide to retain him, I know you will be satisfied with his service."

This package, with this letter of endorsement, included a letter from the attorney.

1. Attorney's Letter -- Text to the effect ...

"I am delighted to learn of the unique gift Mr. CPA is offering you, his client, at this time of Thanksgiving.

I do this and this, blah, blah, blah.

Call my receptionist for a time we can spend 30 minutes discussing any tax question you have about your business.

You may have a question about blah or one about blah or blah. Recently I have had clients with problems in such and such an area. Blah, blah, blah.

Please understand that Mr. CPA is offering you a "no strings attached" gift which I am helping him/her to provide.

I'll answer anything I can at the moment. If it is an issue that requires further time, I'll tell you what needs to be done or considered. You can take that advice to any attorney you wish. As a matter of fact, I'll even give you a list of other attorneys in whom I have confidence to handle your needs, if you would like.

Of course, I would be grateful to handle your case, but I assure you I will place absolutely no pressure on you to retain me.

Blah, blah, blah.

The only request I have of you is that you call my office by January 15th to schedule your gift consultation.

I look forward to helping you enjoy Mr. CPA's Thanksgiving gift to you."

He had about 1/3 of his time scheduled before the offer. By March 1 he had a full practice! I believe he made the arrangements with about 5 or 6 CPAs, though I don't recall how many clients this represented. The overwhelming majority of those business owners/managers who needed further legal advice retained him.

Even though I designed the program and wrote all the copy, I was surprised how quickly he filled his schedule. :D

Everyone was happy -- the CPAs were thrilled to be able to offer such a valuable, unique gift. The clients loved the idea! Obviously my client, the attorney, was ecstatic! He was even delighted to pay me my exorbitant fee!! :D

I don't think he ever needed to use the program again. ;)

Paul

handprop

11-13-2009, 10:35 PM

Another question springs to mind. This thread developed along its present path as a result of Dave complaining about unwelcome customer types, and Mike commenting that this was because Dave's advertising attracted that type of customer.

So, let's turn that into a hyperthetical case. A company starts up, advertises as they will - usual stuff, local newspaper, Yelowpages, brochures, flyers. They get customers but, after a while, believe there are better customers to be had, if they could just attract/find them.

From what I gather at this point, the consensus is to survey (test) one's existing customers. But this hyperthetical business doesn't want more customers like that, they want "better" customers.

Where do we go from here? Round up some "better" people without knowing whether they would buy from us or not, and survey/test them? What's the chance we would get a useful result from that approach?

Or, would we be better off by changing what we do to suit the customers we want? Eg. Advertise remodelling services to interior designers vs advertise our home services to homeowners.

OK Spider, I'll start over and work through the whole problem

PART 1

Think of a factory that has a bunch of assembly lines. The speed of each assembly line is regulated by the worker. The supervisor has a report that tells him what each assemble line must produce each hour in order to break even, make a profit, make a big profit, or make a **** ass load of profit. He pushes and pushes each assembly line worker to produce the maximum parts while maintaining quality, after all his entire bonus is based on performance of his crew. Each week he reports to his boss and the results are tabulated into a spreadsheet. Now the Accountant, CFO, CEO, Vice President, and President sit around a table and examine the information etc. They look at past results, current results, and future projections.

What happens when a worker can't keep up or shows up late every day? They get fired right? No ifs ands or buts! Really, what would be the point of keeping a bad worker around? So the supervisors’ job is to keep up with the standards set by upper management. If he doesn't then he gets fired. Simple hey!

OK, so upper management and the executives are always looking for the next big thing in optimizing production. They NEED to know what happens each time the make a change in production. A spreadsheet or software tells them the results.

An example would be padded flooring. Factory management put in padded flooring around all the machines in the shop and production went up, and of course so did the profits. They didn't guess, he just looked at the results in the reports. It turned out to be a great investment. But it didn't end here. Pads are great but let’s maximize it now. What happens if we make it thicker? Just make the change and look at the spreadsheets for results. If production goes up even more change the pad thickness. If it goes down make them thinner, then look at the spreadsheets. All that’s happening here is we know the pad works because the spreadsheet told us. If we have something that works then tweak it for maximum results.

But let’s just say management had this great idea and he gave everyone a lollipop before each shift and it cost him $500 each week. After looking at the reports he realized production didn't change, or worse it went down and now had to hire another janitor to pick up the wrappers on the floor. After the lollipop idea was enforced the cost now became $2000 a week and a decrease in production. Ouch!! Bad move!!

I know this is a simple story and my goal is not to make you feel like a child. I'm just trying to prove a point. As a marketer nothing is worse than not tracking all marketing efforts.
Most businesses fail at doing this. They simply spend some money, roll the dice, sales go up a little but they have no idea why. What's worse, they don't know what marketing tool worked better than another. This is a big mistake!! Marketing people can learn a lot from a factory.

Like a factory, you need to keep track of every marketing move. If you spend $800 month on a billboard you want to track the change in business on a spreadsheet or a simple notebook. This allows you to compare it to other marketing tools like a coupon for example. Then, over time the results are tabulated and it tells you what marketing tool to get rid of. All the big corporations do this.

I use a few different marketing tools. Every marketing tool has a code that I can identify and keep track of. OK, this may seem like its one marketing tool but in fact it’s actually 5 different tools in one. Let me explain.

I give those gift cards out to everyone in a very organized manor. Strangers I meet get serial numbers starting in the 1000#. Customers get serial numbers in the 2000#. Then I give customers two extra cards and ask them to give them away to a good friend or relative, these gift cards are the 3000# serial number. You get the picture right. I can now track my sales.

When a customer calls ask them how they found your number. If they have a gift card ask them what the serial # is and jot it down on a spreadsheet. At the end of the week and month I produce a report and look at a chart that shows sales volume. My sales and profit go up big time the more cards I give out. But be careful here. Not all cards are treated equal. The two bonus cards I give out to current customers and ask them to give them away to people they trust yield me the most profit......without a doubt. I don't believe in me, I believe in my spreadsheet. Numbers don't lie! Right! Knowing the #3000 serial number yields me the most profit that's the one I spend time tweaking and distributing.

The best part is, over time because of good tracking I have thrown out any marketing that was weak and ramped up the marketing that yielded the highest profitability. JUST LIKE THE FACTORY STORY! Simple stuff but most companies never do this. I live and die by my spreadsheets. My spreadsheets make me a lot of money and can do the same for you.

One thing to keep note on is I keep test/track the marketing vehicles AND the three groups.....STRANGERS......PROSPECTS......CUSTOMERS . You must understand the difference between the two or all of this will make no sense.

Reality check........Most businesses keep trying to attract new STRANGERS with marketing, and that's a big mistake. Pay attention to current CUSTOMERS and let them do the advertising FOR YOU!!!!!!! CUSTOMERS will make you the most money not STRANGERS.

For part two I will get into the difference between the two and explain why. When this is all done it will make total sense.

Mike

handprop

11-13-2009, 11:03 PM

Let’s skip PART 2 until later

Sorry, more tracking information. I know this sounds a little boring but it's required for any great marketing system. And the results of tracking yield the highest profit potential.

I mentioned that a gift card is one of several marketing tool I use to generate sales. Then I explained how the gift card alone can be used in several different ways to create several different marketing systems all in one card. Understanding tracking as I explained it in the first email it's easy to get in the habit of only tracking just the different marketing tools. There is a lot more to tracking than that. Let me explain.

We know that if we have 2 marketing vehicles we can track each of the two and determine which one yields the best results then concentrate efforts on the better of the two. Looking back at the factory example we learned that the padding on the factory floor yielded great results because the spreadsheet told us. Then I explained that we can take something that works and tweak it for maximum results. Let's go back to my gift certificate and learn how I created it.

My own experience tells me that in the service industry a gift card works well, so right off the bat I want to use a GC to promote a business and generate quality customers. The trick of course is to figure out the best combination (maximize marketing efficiency) and record the results as I kept changing.

The first GC looks very different than the final product. I started out with what I think is a good design based off experience. I hand them out and start tracking them when people call. Even though I had X quantity results I knew from marketing experience that the goal isn't just results, but MAXIMUM results. So I begin to change the card.

I start with $25 GC's then decide to make it $35 instead. I do this knowing I’m going to keep track of the results. What happened the first time I did this was interesting, ABSOLUTLY NOTHING!!
I know this because I tracked the card numbers and the results never changed. I did this for a while until I came up with the magic number of $50. It took a little time to record the data to the spreadsheet and graph it but the difference was amazing. My sales went up almost 80%. The reason for this is perceived value. When people have $50 in there hand it creates a little meaning and becomes valuable. The spreadsheet told me that 50 is the best number and yields the greatest profit potential for the marketing vehicle. A GC of $25 has little value and people just threw them out, but a $50 GC people hold on to, I know this because my spreadsheet told me.

OK, were not done yet! So what else can we do? The GC has more information on it right? I then began to tweak the words and layout, tracking at each and every move until I have what I feel is a GC that has been totally maximized for results. Never at any point do I guess or use my own opinion from here on out that’s a big mistake. I just made changes, tracked it, changed it, tracked it, changed it, tracked it, and well, you get the picture. So the point is tracking to a spreadsheet CREATED MY MARKETING VEHICLE.

Are we done tracking yet, HELL NO!

How about the delivery system? That’s right, tracking works to help us decide where and how the GC gets into the hands of the people. Once I figured out the highest yield GC I could (based on tracking) I wanted to maximize the delivery, my goal is to also maximize word of mouth business as well, two birds and one stone so to speak.

We have STRANGERS, PROSPECTS, and CUSTOMERS. Tracking told me that my best results were from current customers who gave out cards for me, interesting hey! I track everything and the delivery system is no different. I learned from my spreadsheets that if I walk down the street and hand out GC's the results are only 10% of the word of moth cards. It makes sense then, as a business owner, I need to concentrate more effort with current customers. If your confused at any point just post another question.

A quick recap of tracking

We use tracking to create a marketing vehicle
We use tracking to monitor the difference between marketing vehicles
We use tracking to maximize each marketing vehicle
We use tracking to maximize the delivery system for the marketing vehicle
We use tracking to forecast future marketing efforts

All this seems like so much work but in reality it's less work. When I first started my business the initial work was tough and hard but now it takes zero effort. That’s the beauty of tracking, all the hard work is done, and everything is maximized. I spend little time marketing my business now. If my sales drop I can look at a spreadsheet and ramp up one of my marketing tools, that’s about it.

I look at it this way. If you put in a 10 hour day in a cleaning business revenue can be $500, $800, $1200, $1500 or say $2000. Either way you still have to work 10 hours. In reality most people put in 10 hours just like me but end up making far less. They have no idea why because they don't track. And because of this they have no idea what to change. The world to them becomes a big mess and there just busy managing the mess. I track and have a goal of X quantity a day. I have tweaked about everything I can and now sit back and enjoy the results of all my hard work.

OK, now for the real PART 2

Mike

Spider

11-14-2009, 11:02 AM

Spider

11-14-2009, 11:06 AM

Mike - Marketing/Tracking - In Part 1. - the Factory and Giftcard explanation - the process started with a guess, it seems. Not with a test or a survey - with a guess.

para.4. "They didn't guess, he just looked at the results" - but they did guess. There is no indication of why they put down padded flooring. They seem to have guessed that it might make a difference, and it did. I understand the subsequent test-results process but not the first step, if it was not a guess.

Likewise with the Giftcards. There is no indication that a test, survey or other process was used the suggest Giftcards might be useful. The first step was a guess.

I can see from my own experience that small businesses generally do the first/guess step but don't follow up with the tracking. In fact, small businesses often do nothing more than a series of first/guess steps one after the other. And that is the point of this discussion, is it not?

I only pile on about guessing because of your oft-repeated statement that there is no guessing going on. And that's what threw me. I think of an idea, try it, and see what happens. That, to me, is a guess. The subsequent tracking is the important bit, though.

I'm on board now.

Patrysha

11-14-2009, 01:11 PM

Spider

11-14-2009, 06:10 PM

Of course the first step is always a guess...an educated one based on piles of experience, readings and research (one would hope) but a guess when it comes down to the wire...
What difference does that make?
If it comes with tools to track and measure...then each subsequent effort is less guess and more know.I agree, Patrysha. As I said, though, it only makes a difference because the statement had been that none of it was guesswork, and I took that to mean none of it. I couldn't see how the first step was not guesswork and I was looking for something defined - the non-guess. Now that Mike has explained his process in more detail, it is clear. And it doesn't matter whether we call the first step a guess or not.

I was confused. Now I'm not. Mission accomplished.

handprop

11-14-2009, 08:59 PM

Patrysha summed it up nicely and piles of experience like she said can really make a difference in how fast you get to your goal, but it doesn't always take personal experience. I'm a copy cat, I always have been, some people strive to be original and although I think that's a fun ambition it's really inefficient. I learned long ago that if you copy what works you make money faster. Lets use the gift certificate as an example, as marketers we have some pretty cool options as to what we can do and there isn't a correct answer either especially when you consider that each and every business is very different from each other so it always comes down to customizing per application.

Yes, I do guess at first and I should of done a better job of explaining it. But one thing to consider is some people guess and it's way off base because they live in the marketing illusion. What's even worse is they stop at the first stage.....it fails.....and they say "I tried gift certificates and they don't work at all", that's unfortunate people do that. I never stop at the first try because the goal isn't to make money......the goal is to make a heaping pile of money.:D

When I guess I get really close to the final product right away because I know what generally works, some from personal experience and some from a marketing network that I have been part of over the years.

I'll give you an example of a skilled guess and a novice guess.

A novice might decide to put a picture on his gift card because he heard/read that a picture can humanize the experience and most marketing people think it's a good idea. So that's what he does, he put's his picture on it and thinks to himself "Man, does that look cool", and he never looks back.

If I put a picture of myself or a client on something I follow a set of rules that have been in practice for many years concerning photos in marketing, I depend on stealing my ideas from professionals and Universities that have already done the hard work on this subject, why would I want to reinvent the wheel?

Data and experience tells me that a photo of a person should always be located in the upper left corner of the marketing piece/page/advertisement for best result. People have a natural tendency to always look in that spot first so as the old rule says.......Just give them what they want and put it there! Next time you look at a magazine or a fresh internet page pay attention to where your eyes go first.

How about the photo itself? Well, studies overwhelmingly conclude that for a real warm and friendly result the photo of a person should ALWAYS be looking into the copy and NEVER away from it, so a slight turn in and bingo you have a much better experience for the customer. As a matter of fact, to turn away from it is considered a real negative and makes it feel cold and uncomfortable. Marketing is all about the total experience so I didn't really guess, I copied it from people who have done the research and for the rest of my life I will only use a photo in this way. So did I really guess?........sort of.

I should mention that a gift certificate with a photo compared to one without a photo yields the same result. I would never advise to put one on a certificate for a person in the service industry. It makes more sense to use the space for the offer.

Mike

handprop

11-14-2009, 09:04 PM

None of the final product is guess work!!!! It's called hard work.:D

vangogh

11-16-2009, 08:08 PM

Frederick it always starts with a guess or better a guestimate. It's an iterative process. You do your best based on experience to get started and then you measure what happens so the next iteration can be better than the first.

The more experience we have the better we are at making that initial guestimate, which ultimately gets us to the success at the end quicker, but that first time you won't know, you'll be doing your best to get it right.

Paul Elliott

11-16-2009, 09:19 PM

If I put a picture of myself or a client on something I follow a set of rules that have been in practice for many years concerning photos in marketing, I depend on stealing my ideas from professionals and Universities that have already done the hard work on this subject, why would I want to reinvent the wheel?

Data and experience tells me that a photo of a person should always be located in the upper left corner of the marketing piece/page/advertisement for best result. People have a natural tendency to always look in that spot first so as the old rule says.......Just give them what they want and put it there! Next time you look at a magazine or a fresh internet page pay attention to where your eyes go first.

Mike, that is good practice. The viewing process of any piece of printed matter or web page. It falls under the heading of the psychomotor aspects of visual perception. IOW, when we see something, what do our eyes do and why.

The upper left works only for readers of English and similar left-to-right written languages. It is the reverse for right-to-left languages such as Arabic or Hebrew. I've not seen results for languages such as Chinese that can be read vertically.

It has to do with where we are conditioned to begin reading. This has been studied rather extensively with web pages and are referred to as visual "heat maps." We English readers anchor our visual acquisition in the upper left corner. That is why the picture there works best. It sets the tone for the rest of the piece in the mind of the reader--very powerful.

Yes, the picture with the person angled in slightly works. It invites the reader to read the rest of the piece. However, a right profile picture with the person looking directly into the page and apparently ignoring the reader does not work very well.

Paul

handprop

11-16-2009, 10:50 PM

I'm
guessing
that
the
Chinese
would
like
to
see
a
picture
at
the
top
in
the
middle
and
centered.
I
would
also
guess
the
photo
should
be
a
person
looking
straight
down
but
that's
just
a
guess
and
not
backed
by
any
real
data
or
experience
though!

Thanks
for
the
book
advise
by
the
way.

I
really
enjoyed
it!

Mike

PS
Boy
am
I
glad
I
don't
have
to
market
to
the
Chinese

Paul Elliott

11-16-2009, 10:57 PM

I'm
guessing
that
the
Chinese
would

I guess your guesses are all good ones! :D

Paul

handprop

11-16-2009, 10:59 PM

Were not back to guessing are we?????? Holy Crap Paul, that means I have to go into another big long story and I just don't have the energy.:D

Mike

And for my next trick...........

Paul Elliott

12-07-2009, 11:31 AM

Quoting from another thread --

BTW, Paul - welcome back - you disappeared for a couple of weeks, right when you were enlightening me about your promotion for an attorney with some CPAs. I am still at a loss with how you pulled that off.

My last post on the subject was here -- http://www.small-business-forum.net/traditional-marketing/2186-another-advertising-idea-8.html#post24735 (http://www.small-business-forum.net/traditional-marketing/2186-another-advertising-idea-8.html#post24735)

Care to pick up that conversation again?

Sorry, Fredrick, I thought I'd finished that one.

To summarize --
Attorney wishing access to CPAs' clients approaches CPAs offering them a unique Christmas gift to give their business accounting clients -- a free, no-strings attached 30-minute legal consultation on any subject they wish.
Attorney pays all the expenses of the offer packages and mailing.
Offer package has a cover letter from the gifting CPA to his or her clients basically saying Merry Christmas with a unique, valuable gift and comments validating the knowledge and expertise in business legal matters. This positions this as an "endorsed mailing," i.e., the CPA endorses the attorney = the transfer of trust.
The offer package also includes a letter from the attorney outlining his or her free offer and how to collect the "gift," the free 30-minute consultation.
When the attorney delivers the free 30-minute legal consultation gift, he or she makes the recommendation for the next step/s. If no additional steps are necessary, the attorney establishes good will and the opportunity to continue marketing to the business.
The client is perfectly free to take the advice and go to another attorney, though many will stick with the gifting attorney, since the gift has already established a relationship and the credibility.
It's a triple win:
CPA -- able to give a unique and very valuable gift for nothing
CPA's clients -- get a unique and very valuable gift
Attorney -- opportunity to gain access to the CPA's client base for very little expense and many new clients
Obviously this has a number of ramifications for many other business relationships where one business wants access to the client base of another business.

Paul

Paul Elliott

12-07-2009, 11:59 AM

Paul - Attorney and CPAs - Frankly, I don't see it. There must be something I am missing. Let's take the actual occurance as you described it.

I could see it if one was helping a very close friend, but you say the attorney and CPAs only "knew of" each other. Hardly friends, then, and probably not even aquaintances. So, why would the CPAs go out on a limb to help the attorney? Why would they risk their reputation and thus risk their business for someone they only knew of?

I'm sure I gave the wrong impression, then. The attorney knew the CPAs at least in a professional sense and liked their work. The CPAs respected the attorney's work.

I'm also not sure of the relationships involved, since all my client did was get me the names of the CPAs and I structured the program for him to offer them.

Clearly the CPAs the attorney contacted felt only that their reputations would have been enhanced by offering their clients this gift.

You say, "Likely the mix or the offer were not good" in my case. What made them good in your case? I cannot see any benefit for the CPAs in the story as you tell it, Paul. Did you miss something out? What enticed the CPAs to do this?

(See the summary in a message above.) I'm not sure why your case didn't work and was merely suggesting that the mix of personalities or business types plus the offers may not have been enticing in that/those market/s.

The CPAs seemed to get no monetary benefit from the mailing. They seemed to anticipate no increase in their business from the mailing?

Most businesses give seasonal gifts. That is what this represented -- a very unique, yet valuable gift that actually saved the accounting firm thousands of dollars. It probably produced a lot of good will on the part of the firms with their business clients.

They seem to have blatently lied to their established (and profitable) clients - "business tax legal consultation ... at my expense" - there doesn't appear to have been any expense on the CPAs part.

Well, of course, they had the expense, though minimal, of selecting and providing the list of appropiate business clients to the attorney. As I recall, at least one accounting firm took the packages and affixed the mailing labels to them and delivered them to the post office.

With the above analysis in mind, I cannot imagine any CPA agreeing to such a mailing. Hopefully, your comments will enlighten me.

Well, I hope they have. Obviously this would not apply to all businesses, but for some it is a triple-win situation.

Any other questions I did not cover? Hollar.

Paul