20% of your customers are eating up your profits by 80%. The old Pareto’s 80/20 rule does tend to hold true more often than not. The bottom 20% of your customers or even prospects are the people who are costing you more money to service than what they spend with you. They might be killing your business.
Now let’s take that down to creating or buying a list of prospects. You don't want to just buy a list when 20% of the names will be automatically unprofitable. Think about it. You don’t have the time or money to be wasting, do you? You want, no need to understand who your best customers are so you can go out and find more just like them. There are ways to do this, be it on your own or by using a list manager.
If you start to take this approach it will start to force you to think differently. Consider: What if you changed your sales incentives to be aimed at only closing deals only with those kinds or accounts that have the same needs, desirers and structures of your now most profitable accounts rather than closing any and every deal that falls on your desk? If you did this, you can start the shift to a mindset of going after the perfect customer.
Coming out of a direct marketing company where it's easy to build a list of names, we need to refine those efforts and not get into the Oscar Olsen syndrome of “good enough”. Don’t do the same old again and again. If you want to run a meat market marketing attack go down to Bob's the butcher's Meat Market, if you want to be going out and running through a cycle every two or three months of acquiring new names and pushing them out through the funnel system, go on. For my money I want and need more bang for my buck.
Larson Notes & Satire: When you are wearing your marketing hat you need to get more. More visibility and more action. This means using databases in every conceivable ways possible on every channel you can work with at 95% and above. That does not mean you just in dabble in direct mail or email. Mix it up, shack and bake baby, ad in a secret ingredient. Mix in telemarketing, digital advertising, dare a say go out and buy a key word if you can identify those high value customers and plan your entire advertising campaign accordingly, you might actually get higher ROI. And this in turn can contribute to the success of interactive marketing by using customer knowledge to create relevant email, deliver real-time offers in online and off line channels.
Did I say plan out your advertising and marketing? Now that’s going to hurt! All you fly by the seat of your pants marketers out there, you are not Procter and Gamble who have more money to through at advertising in one day that any of us have in 5 years so “choose wisely”. It’s only your company and your life.
Remember our 3 new programs for 2011
1st is our Virtual Sales Manager Program.
2nd our Sales Function Outsourcing Program
3rd our Virtual Business Consulting Program
Larson & Associates
Target Marketing & Telesales Professionals for new account acquisition
Making good businesses great and great businesses even better
P.S. We make telesales for small business affordable by offering programs down to only 15 hours a week. Maybe you could add telesales into your marketing mix call today and find out.
P.P.S. Take the Larson Challenge to double your sales this year and get listed on our web site @ http://www.larsonassociates.ws/Larson_Challenge . Email us your company name and web address to get listed. Make this year your best ever!