Identify your “platinum customer” and speak to that audience. Don’t worry about the rest.

Most business people try to cast as wide a net as possible when creating ads. This is perfectly understandable and at first glance feels logical. But, concentrating your message on your highest value customer doesn’t mean you are leaving everyone else out. What it does mean is that you are increasing the odds of attracting more of the customers that benefit your business most. Those who don’t quite fit into your “platinum” category will still hear the message, will understand what you are saying and will still become customers. And, when it’s all said and done, you will probably increase the value of your overall customer base.

 Create a profile of your “platinum customer” defined by the following:

• Annual sales volume
• Frequency of transaction
• Ease of service
• Annual value
• Lifetime value

Even if you don’t have a single customer who currently fits your ideal description, this exercise will help you gain clarity and move you toward an overall higher quality customer base.

It’s about them. Not you.

The concept is simple enough. But, as a business person, this is without a doubt, one of the hardest things for you to get past.

You spend your days and nights thinking and living your business. You work hard to create something of value to a customer, and you want people to know about it. No wonder you talk about what you have, do or have achieved. And, I’m sorry to break this to you, but most people don’t care.

People buy things because they have a problem to solve. No one gets up in the morning and decides they just have to have that shiny new lawn mower. They buy the lawn mower because they want a mowed lawn. Does Black & Decker sell drills or holes? Does Bayer sell pills or pain relief? This applies to everything. If you are going to be effective in your messaging, you have to understand why your customers buy the product in the first place, and then structure your creative from that point of view.

Here are some simple questions to ask before approving an ad.

• Why do people buy this product?
• How is their situation better after they’ve used the product.
• How does your product or company differ from your competition?
• How does that difference make your customer’s situation even better?

If you make sure your ad message describes how your product will make your customer’s life better, you will have a more effective ad.

Marketing Basics for Today’s World:  Attached is a PDF of a presentation I recently gave at the Seattle International Textile Expo. It is a general overview of what is important in today’s marketing arena. Much emphasis was placed on those basic things that make marketing work, which has not changed over time. With so much conversation these days about all that’s new (and there’s a lot) we need to remind ourselves now and then about what really makes advertising work.

For those of you who attended the presentation, this copy of the power point slides should help you remember the key points. For you who didn’t attend, I hope this outline is self-explanatory enough to make sense. If you have any questions about any of this or would like to discuss and point in more detail, I would be delighted to do so with you.

Brainstorming is a great way in the creative process to break through mental barriers to discover creative ways of solving problems and reaching objectives. Throughout my career in advertising I’ve witnessed wonderfully productive sessions as well as complete flops. In every case, when a handful of rules were applied, the results were remarkably better. It is also a good idea to follow a couple of steps leading up to the session. Those steps include:

1. Whoever is organizing the session should briefly summarize the topic and goal of the brainstorm and then get it to the team members far enough in advance for them to think about it before the meeting.
2. The meeting should be held in a neutral location that is away from distractions. For example, the boss’s office would generally not be a good brainstorming location.  
3. Once everyone is in attendance, start the meeting with some general chit-chat to loosen everyone up.

  Once the session is under way, follow these rules.

1. Focus on quantity of ideas: Let go of going for the silver bullet. Just pile on as many ideas as you can. Lots of ideas will reveal surprising results.
2. Everybody gets a turn: Let everyone speak. Resist the urge to interrupt. When the presenter is done, then let the group discussion carry it forward.
3. Withhold criticism: This is the most important rule of all. No negative feed-back whatsoever. No matter how silly the idea may seem, negative comments, frowns, or groans will kill the entire session.
4. Record all ideas presented: You can write them down or voice-record them. But, save them for analysis and discussion later.

That’s it. These four simple rules will vastly improve your chances of pulling a great idea out of your brainstorming session.

If you have an interesting brainstorming story, please share it with us here. Or, if you have further insights into the brainstorming process, please share that as well.

Rob Charlton

Whether you’re doing guerrilla marketing or advertising on the radio or television, the more accurately you target your ideal customer, the better your success will be. There are two habits most business people tend to fall into.

1.         Grab all the sales you can get.

This is completely understandable and only natural for an aggressive sales person or business owner. But, what it does is distract your targeting efforts away from the customers who will ultimately be most profitable. In order to make your marketing efforts as efficient as possible, take the time to really identify your “platinum customer”. How much do they spend? What is their life-time value as a customer? What do they buy? What common thing causes them to buy? How easy are they to deal with?

Sure, grab all the sales you can get. But, if you concentrate on grabbing all the sales you can get FROM YOUR PLATINUM CUSTOMER, you will pick up sales from the rest. And, your marketing dollars will give you a better return over time.

2.         Target your primary demographic.

This is a good start, but not good enough. Demographic refers to age and gender. Consider the following audiences based upon age and gender: a 35-year old female.

1. She’s in a business suit with a briefcase and occupies a downtown office making 6-figures a year.
2. She’s single, on a bus with two kids and food stamps.
3. She’s married with three kids and she’s in a minivan full of little soccer players.
4. She has orange spiked hair, a nose ring and works at an art studio.

As you can see, all of these women are the same demographic. But, they are vastly different audiences. In order to target your customer in a meaningful way, you must know more about them than age and gender. You need to know their education level and income range. You need to know what their values are. Do they value function over form like an engineer, or form over function like an artist? How do they spend their discretionary income? What are their leisure time activities?

The more you know about your best customers, the more efficiently you will be able to find them. The more accurately you will be able to deliver a meaningful message to them. And, the more valuable you will become to them because you are providing exactly what they need.

Rob Charlton

When creating a marketing plan, the very first thing that should be done is to write a situation analysis. It’s easy for business owners to gloss over this step because they are so deeply involved in their business it doesn’t occur to them that there is anything to learn by writing it down. The fact is, however, this step is often the most important element of your marketing plan because it allows you to reveal and prioritize solutions to specific challenges.

Here is a starting point of  20 questions you should be answering. Some of these may seem simple and obvious. But, seeing the answers written down in context with other information provides clarity that can reveal relationships you haven’t noticed before. Likewise, as simple as these look, you’ll be surprised at how difficult it is to answer some of them.

1. How long have you been in business?   
2. What does your annual sales curve look like and how has it been trending over the past three or four years?
3. How many competitors do you have? (list them)
4. How big is your business compared to theirs?
5. What are their hours? What are yours?
6. How do your competitors attempt to differentiate themselves? What is their primary image? (quality, price, exclusive lines, service, etc.)
7. Are they fulfilling their claims?  
8. What unique benefit do you provide that competitors don’t?
9. Where is your business located in relationship to customers and competitors? 
10. What does the customer landscape look like? (growing, diminishing, why?)
11. Describe your best customer.
12. What does the broad cross-section of your customers look like? (demographic, psychographic, social, income, geographic)
13. Are there enough customers to go around? 
14. What have you been doing to market yourself? 
15. How has it been working? (quantify as much as possible)
16. What are your competitors doing to market themselves? 
17. How much are your competitors spending on advertising annually?
18. How are they presenting their strengths?
19. Does your business have a weakness or bad public perception in any area that must be overcome? (ie: poor quality or service from previous owner, old facility, etc.)
20. How has your industry changed over the past few years, and how is it expected to change in the future?

All of the 20 questions listed above may not apply to your particular business. But, for those that do, be sure to explore the answers thoroughly. Some of the questions may at first sound simple, but when you really get into it, can be quite complex. The more detailed and honest you are in defining exactly where you stand in terms of competition, market size, industry trends, past marketing results, and anything else you can learn, the better equipped you will be to determine your strategy.  

Rob Charlton

 If you own a retail business that relies upon customers coming to your store, one of the most fundamental things you need to know is where your customers are coming from. Many business collect zip codes, but that’s not detailed enough. You need to identify the neighborhoods and business districts they are coming from. Do that, and you can target your advertising and marketing with much greater efficiency.

The Dot Study is a simple and inexpensive marketing research tool you can use to gather this information.

Go to your nearest map store and buy two fairly good sized maps of the area around your store. The maps should be big enough so they include the areas around your store outside of where you think your customers are coming from.

Mount each map on a piece of foam core or some other rigid backing. Mark one AM and one PM and then switch from the AM to the PM map at the same time (of your choosing) every day. The reason for this is to distinguish your source of sales during the day from those during the evening. Often, people will shop from work or some other place during the day. But, will shop from home in the evening. This is important to know, especially if you have a business such as a restaurant where you need to target lunch versus dinner messages. 

Instruct your sales staff to ask each person they wait on where their shopping trip originated from. In the evening it is a little more important to establish that the originating point is their home. They don’t have to give you an address or anything specific. All they have to do is point to an area on the map. Your staff will then place a colored dot on the map with a felt pen where the customer has indicated.

It is important to do this consistently and long enough to get a distinct visual representation of where the dots begin forming clusters. After a week or two, you will begin to see patterns emerging that will provide a great tool for future marketing.

How would you change your marketing if you could see on a map exactly where your customers were coming from?

Rob Charlton

Crowdsourcing is a term that refers to the act of presenting a problem to the public at large, and then letting anyone and everyone submit solutions. Some crowdsourcing for problems that require specific expertise may be limited to a qualified group. But, the same principle applies. The term was first coined by Jeff Howe in an article he wrote in Wired magazine in June of 2006.

 This is a tactic that has been made possible by the evolution of web 2.0 technologies, and brings with it the exciting prospect of finding creative solutions that would otherwise never be known, or, at least, not discovered for years. When a company hires a team, whether in-house or contracted, it draws from a limited pool of brain power, and then turns them loose to solve a problem. As talented as the team might be, it’s only logical to expect the existence of solutions they never thought of.

Crowdsourcing, on the other hand, broadcasts the problem to a vast, unknown group of individuals who are free to provide their best ideas. The entity seeking a solution gets the brain power of anyone who wishes to participate, from professional experts to undiscovered geniuses. In some cases, the solvers can become collaborators and work to refine divergent answers into one final solution. The final solution is then owned by the entity who broadcast the initial problem.

Sometimes the people who collaborated on the solution are rewarded with money or prizes. And, sometimes the only reward is recognition, which is the other side of the coin, and is causing a good deal of controversy about the practice.      

For examples of crowdsourcing visit Wikipedia. You’ll find several there. Jeff Howe also writes a blog on crowdsourcing which can be found at http://crowdsourcing.typepad.com/cs/ .

If you have any experience with crowdsourcing or have an opinion about it, please leave a comment.

Rob Charlton

In the advertising agency business, one of the most difficult things to do is acquire new clients without lying. This is because when two or more agencies are presenting to the same client, it is often the one that makes the biggest promises that wins the business.

Most ad agencies stay within the ethical boundaries of truth, even if it’s embellished in a “dog and pony show” presentation. Some, however, willingly cross the line.

The question then becomes, why does a smart, successful business person buy into false promises and what can he or she do to avoid it? Here are four reasons why blatent exaggerations are believed and what you can do to keep from falling for them.

THE FORTUNE TELLER SYNDROME
The advertising category is the only consulting service a business uses that deals with the future. Everyone else: the attorney, accountant, even the insurance agent, is a historian. The entire premise of using an ad agency is built around shaping a better tomorrow. Therefore, the client is already in a state of mind to accept predictions before a single word has been uttered.

What to do
Go into your agency review knowing that these people are mere mortals. A good agency will be able to explain the fundamentals of good marketing and why it works. But, combine an unkown future with the variables of human behavior and no one can actually predict an outcome. There are industry expectations for response to marketing. Ask what the avearage response rate is and resist the temptation to believe anything outside of those standards.

I CAN GET IT CHEAPER
One of the most effective ways to win a client is to convince him or her that the agency can buy media cheaper than anyone else. This line of reasoning fits perfectly with a business person who is fine tuned to getting the best wholesale prices on products they sell. They understand the concept immediately and very little explanation is required.

What to do
There is no other business where manipulating numbers is so easy and convincing. To illustrate this, we recently presented three plans to a client, all with the same rating points per week. But, at the end of the year, there was more than a $100,000 difference in actual cost. The difference was not based upon the ability to buy cheaper, but was based upon a multitude of other variables when making the buy. Your best tactic with regard to this claim is to completely ignore it as a reason to choose an agency. Rather, ask them what their media strategy would be for your particular business.

THE MISTIQUE IS GONE
Like it or not, this business carries with it a certain cachet that others find a bit fascinating. When an ad agency has been around too long, what they do becomes so familiar that it’s like knowing how the magician does his trick. The bit of mystery that makes ad agencies different isn’t there any more. In a client’s desire to “see what’s out there”, there is also an expectation that there is something special they’re not getting.

What to do
This expecation sets the stage for believing claims that are lofty or just plain false. To complicate things, we are in a period of time when on-line marketing is being integrated into agency capabilities. Because of the different levels of competency agencies have in this fairly early stage of on-line marketing, you may find actual differences. The key here is to remain objective with regard to actual capabilities. If one agency can provide Facebook ads or keyword search and the other can’t that’s cut and dried. But, if it gets down to how one agency can do it better because of some secret forumula, that’s the time to stop listening.

POOR SALES
If a company’s sales are lagging, there may be many reasons why. And, if an ad agency is involved, I guarantee that it will be called into question. The client may not even blame the agency directly. But, there is the desperate hope that a new marketing approach will save the day. And, it is in that desperation that the business person clings to the belief that what is being said is worth taking a chance on.

What to do
This is the hardest one of all to deal with. Low sales can cause panic in the best of us. In a situation such as this, it is best to bring in a trusted third party who has some experience in marketing, or choosing an agency. Having a sounding board to modify your instinct to go with the biggest promise can help to keep your emotion from overruling your logic. But, you must be willing to listen and question your motivation.

If you find yourself in a position of hiring a new ad agency, be careful about what you believe. Don’t get distracted by colorful charts and shallow claims. And, check yourself against the four states of mind listed above before you believe something.

Rob Charlton

Social Media is the newest darling of marketing. But, for all the buzz it’s generating, there is very little hard data on how or why companies use it, or how successful it is. However, that is beginning to change.

The Aberdeen Group recently concluded a study that shows seven specific reasons why companies choose to use a social media strategy. They separated their respondents into three categories, based upon four key performance criteria. The categories were Best-In-Class (top 20%), Industry Average (middle 50%) and Laggards (bottom 30%).  Of all companies questioned, the top reasons for implementing a social media initiative, in order of their reported importance are:

• Increase customer advocacy / word of mouth        37%
• Protect brand reputation                                                35%
• Improve customer research capabilities                   33%
• Increase product / brand awareness                          32%
• Increase customer loyalty                                               31%
• Increase customer acquisition                                      23%
• Increase customer retention                                          21%

What is interesting to note is that these results were taken from all respondents. However, when looking at Best-In-Class respondents, the number one reason, at 47%, was increasing customer loyalty. The argument might be made that increasing customer loyalty can be seen as an umbrella that includes most of the other categories, so it was just a matter of wording. Or, it might speak to a more refined understanding of Best-In-Class companies that in today’s economy, customer retention is a much more important strategy than in normal times. And, that customer loyalty is a deeper level of customer retention.

Regardless of the relative importance of reasons to engage in a social media strategy, it shows a growing realization among companies that a significant part of their effort to connect with their customers must now take place on this new two-way communication platform. And, it provides the beginning point for quantifying  those efforts.

Best-In-Class companies showed an average of 11% increase in their ability to generate consumer insights that drive new product/service developments. Laggards decreased 10%. Best-Of-Class companies showed an average decrease in customer service costs of 7%. Laggards showed an average increase of 5%.

When companies have to struggle for every sale it’s hard to justify the time and expense for a new, unproven marketing strategy. But, evidence is beginning to grow in support of what many marketing professionals instinctively saw as an important new tool.

Not every company is a candidate for social media. But, if you are wondering what a social media campaign might do for you, a good place to start is the above list. And, if you interview a social media professional, be sure to ask questions that are wrapped around the appropriate reasons that drove you to consider it in the first place.

Rob Charlton