Previous month:
March 2010
Next month:
May 2010

April 2010

The Money Is In The Lists

Two weeks ago during Ed Rivis' Web Strategies Live Seminar it was mentioned rather frequently: The Money Is In The List.

Three types of lists

When we talk about lists from a business perspective nowadays, lists filled with email addresses is never far from anyone's thoughts and rightly so. Over the last 3 - 5 years email marketing has become an easy and relative cheap way of marketing your business to an almost unlimited number of prospects and clients. Of course it is (unfortunately so) also used to fill as much inboxes as anyone can, no matter if they belong to total strangers who are absolutely not interested in your products or services whatsoever! The delivery method is free, so press "send" no matter what. One or two idiots will still be tempted to buy from you - people do buy the strangest things and for the strangest reasons, always have done so and always will do so.
But if it would be wise to focus your attention (time and effort to automate your "blast a 1000 emails an hour" system) one those two idiots? You'll end up with a lists filled with unqualified leads and risk your IPS being banned. That's IMHO not a list that qualifies to have "money in it".

The three lists I'm talking about are:

  1. list of prospects
  2. list of leads on a "long-term" nurture drip
  3. list of clients

Lists 1 and 2 have one mutual feature: all should be qualified leads, some ready some not yet ready to buy from you but with shown interest in your product/service nonetheless.

List 2 and 3 are the most overlooked and/or ignored lists by most businesses. Most businesses focus their attention, time and marketing budget on turning leads into clients in the shortest possible way and if it that doesn't happen within 5 or 6 emails these leads are dropped from the list (= when using an autoresponder program don't receive any new info - ever). And when it does happen and the lead/prospect becomes a client they receive the product/service and are the forgotten by most. The latter seems to happen for two major reasons:

  • the line of thought: once a client always a client
  • the eagerness to convert more leads into clients, 'cos that seems to be the way to grow your business

The Money is in all lists

I think we can all agree that there is money in list number 1, but list number 3 definitely makes money for our business and well in the following two main ways:

  • back-end products (every wooden floor needs maintenance, so we mail - yes, snail mail - every client every 6 months to remind them about our wide range of maintenance products and our maintenance service)
  • building up word-of-mouth, where our existing clients bring us new clients (and get rewarded by the product/service every wooden floor needs: maintenance products and/or service)

And then there is a third reason: our existing clients could decide to move and have wooden flooring installed in their new home too of course (or in the extension they plan to build to their existing home).

If we would not remind them of our existence and our products/services of which they already experienced the quality why would they even think about us when the time comes for either maintenance, recommending a wooden flooring business to their friends or when the need for a new wooden floor arises for themselves?

Nurturing

This leaves us with list number 2: leads on a long term nurture drip. We know from experience there is money in there too - small example: only last Saturday a prospect returned to our showroom after 13 months to decide on their actual floor to be installed next month (and that is not even the longest period a prospect takes, another client took 2 years). I know these are extraordinary examples - but it happens often in our type of business, so we are not very surprised it happens again and again.

Imagine if we had decide after 5 emails 13 months ago this prospect would never make a decision favouring our business and suppose also this prospect had requested quotes from another business too. A business that would have kept them up to date regularly with news on products and services without constantly asking for the sale. Who would have won the sale in the end you think?

Most of the prospects on our nurturing lists don't take that long to come to a decision fortunately - on average a purchase is made within 5 - 6 weeks after "first contact" but as you can see with the above example this average is influenced by those taking longer than 52 weeks ;-)

And all are nurtured with care and attention and once they become clients are cared for again through our strategies and tactics for list 3.

Statistics

Last week I finalised our management report for the first quarter of 2010 and since using Octane HQ as ultimate CRM system the insight we now have in our lists is even greater.

Some statistics:
total new contacts added to the system in Q1: 585
total new contacts in Q1 who've added themselves to the system (by submitting their own details in one of our many webforms): 434 (almost 75% of general total!)
number of new contacts converted into clients during Q1: 80 (14%)
number of returning clients: 5
number of new clients recommended by existing clients: 4

Sources of actual sales in Q1:

6a00d8341c660f53ef0134803eb34b970c-pi

And historically Q1 is one of the lesser quarters, believe it or not, but our business does seem to behave rather seasonable.

All in all (adding items 1 - 4 together) our three types of lists have generated 49.8% of our sales in Q1

Easy of switching between lists

Octane HQ, fuelling your sales, cloud-computing CRM software

Since switching from AWeber to Octane HQ (which now also has taken over our snail mail nurturing) the ease of switching a contact from one list (prospect) to long term nurture drip or client still feels extraordinary to me, no more importing/exporting details from one program to the other. And as I've explained in the series "Pipe-line marketing - going beyond AWeber" the program is versatile and flexible at the same time.

Not only in managing our growing lists, but as I've now also discovered with the report tab in proving once again that the Money Is Definitely In The Lists - in all three of them.


Squeezing at both ends cannot be sustainable, sorry Robert

Robert Craven is business adviser, author and founder of the Directors Centre. I've read various of his books, attended a few excellent workshops he held in cooperation with Barclays, I follow his blog etc and kind of "know" him as an expert on sound business advice.

Why Small Businesses Both Hate and Love What I Am Saying By Robert Craven

It seems that my 'Beating The Credit Crunch' book and 'ology' is like marmite. People love it or hate it.

The messages are pretty straightforward. You shouldn't even think about increasing sales until you have done the following:

Put up your prices if you can
Compete on everything but price
Screw your suppliers' feet to the ground on price
'Fix' the under-performing staff, suppliers, customers and products, or sack them
Pay money 10 days slower; collect money 10 days faster.

There is a bunch of people who seem to miss the whole point. They describe me as callous, insensitive, cruel, mercenary, short-sighted, and selfish....

From Business Unwrapped

Prices up

I agree with the first two tips: put you prices up and never compete on price. Squeeze as much value in your product/service as you can to raise your price. If every business would do this we would all win in a sustainable way - value for money. Everyone is getting tiered of lousy products, lousy service and the businesses that are being rewarded now are those who are adding value.

Short window of opportunity

The part I have a problem with is the third tip: screw your suppliers' feet to the ground on price.

Sure, you might be able to squeeze their price down and experience a double whammy on your profit margin when you also apply the first tip: sale price up, purchase price down = larger margin.

Until your supplier applies the same tip from Robert and starts pushing up his prices while at the same time your client applies the same tip from Robert and starts pushing your price down. And then your supplier's supplier discovers the same tip and so will your client's client.
Everything, including value, would flatten.

In this scenario I can only see one part of the chain winning, the one with the most bargaining power and the loser will be the start of the chain. Nothing new here, farmers and supermarkets come to mind.
Another result I would see happening is both suppliers and clients bypassing the next/last part in the chain (farmer goes directly to the consumer, retailer goes directly to manufacturer etc).

Horizontal versus Vertical

When I tweeted Robert my doubts about the long term effect of his main tips yesterday

6a00d8341c660f53ef0133ece9cf04970b-pi

I received the following reply:

6a00d8341c660f53ef0133ece9cf0a970b-pi

something became clear - later on, I didn't realise the difference in perception until later. I know that someone will always be seduced to take the short term profit:

6a00d8341c660f53ef0133ece9cf13970b-pi

What I realised (pondering in the sunshine in the garden yesterday evening, Spring is here!) was that Robert was talking from a horizontal structure point of view: pitching one accountant to another, one superstore to another, where I was focusing on the long term effect within a vertical structure (supply chain).

And there's IMHO the clinch: horizontal versus vertical structure. And in business every horizontal structure is also part of a vertical structure:

6a00d8341c660f53ef01348019a6ca970c-pi

When every single shackle in this structure follows the principle of pushing sales prices up and pushing purchase costs down no matter what, the whole structure flattens and no one gains.

6a00d8341c660f53ef01348019a709970c-pi

Value and quality would be squeezed further and further to sustain any chance of decent profit. Unsustainable.

Sustainable value

There is another way: demand the highest quality and value from your supplier - value for money - in the same focused effort you yourself will add as much value as possible in your product/service to give your own client more value for money.

Sustainable win-win through out the horizontal and vertical structure.

So yes Robert, I can understand the title why some love and some hate what you say, it is a matter of perception: horizontal or vertical. And since no business is ever only in a horizontal structure, squeezing at both ends of the vertical chain cannot be sustainable ever.

What I would like to know is are you horizontal or vertical minded? Do you regard Robert's tip applicable for your business - long term?


The beauty in/of disruption

The weather was glorious this weekend, sunny, warm, cloudless. The following pictures I just had to take - if only for posterity (will we ever see this again?)

6a00d8341c660f53ef01347ff97dd7970c-pi
6a00d8341c660f53ef01347ff97cb4970c-pi
6a00d8341c660f53ef0133ecc9649f970b-pi
6a00d8341c660f53ef0133ecc9642a970b-pi
6a00d8341c660f53ef0133ecc964ee970b-pi

Absolutely not a single condensation trail of airplanes, the beautiful result of disruption of air traffic caused by the volcanic eruption in Iceland last week.

My thoughts are with all those caught up in the disruption, stranded at airports and trying to get home or to the place where you planned to go. On the other hand I cannot help but think how this lack of air travel over most part of Europe will affect the Global Warming reports.

And I cannot help but appreciate the absolute beauty of clear blue skies all day long without a single interruption of condensation trails. How long ago has it been we've been able to see this - let's call it - spectacle? And when will we ever see this again?

Have a reminder of how the sky will look when air flights take off again:

6a00d8341c660f53ef0133ecc96567970b-pi

Which brings us to that old question again, two old questions really:

  1. Is all progress worth to pursue - for whatever reason
  2. Can we turn back time and reduce /reverse the negative affect some progress turns out to have?


Your thoughts?


Web Strategy Live Seminar

6a00d8341c660f53ef0133ecbb47a7970b-pi

What would someone who's business is featured in "Email Marketing Dynamite" be doing at the first ever Web Strategy Live Seminar held by the author of aforementioned book?

Eternal students

It only took a short discussion with Richard C (accountant, business adviser, mentor) after receiving the invite for Ed's first seminar to decide we would both take him up on his heavily discounted offer and attend (and finally see "the man" himself as it were). Main reason: we both seem to be "eternal students" and never eager to miss a chance to learn more - or different ways.

Richard C is a bottomless well of effective marketing ideas, I've written plenty about our own (web) marketing strategies and the successes with it for our business but there is always more to discover.

Repetition never fails to expose the gaps

6a00d8341c660f53ef01347feb4570970c-pi

Yes, most of the Strategies discussed (at a speed that really made me think we also discovered Warp Speed) are in place in our businesses, but hearing/seeing them once again in great detail did bring out some gaps in our tactics.

Multi-variation testing of landing pages is one of them. Most special "project" webpages I do test already with a simple A/B test (through Google Website Optimizer, definitely with a Z Ed) but I'd not made the next essential step to take this testing up a notch. I will now and have already a project in mind.
I also took away a little extra tip on Google Adwords from Ed, reducing the p-p-c costs on further testing a control ad.

Meeting people - possible strategic alliance prospects

6a00d8341c660f53ef0133ecbb47d0970b-pi

Another reason for traveling down (up?) to London (with the High Speed Rail Link, only 38 minutes!) was of course the chance to meet other businesses with - rather essential IMHO - the same or like-wise ideas on web marketing. If you ever tried to work together (alliance, joint-venture) with a business that did not know or even see the advantage of web strategies (list building, lead pages etc) you know where I'm coming from with this - hard work with limited success. Estate Agents come to mind - but that's a completely different story.

I came away with two firm strategic alliance prospects: one carpet cleaning company and one marble fire-place business. (Email) Talks are already on their way to see where our own lists of contacts/clients can help the other (in the most ethical ways of course, that's one of the first essential and profitable "rules" Ed and others give you). Looking forward to this project - I think it could even be a joint strategic alliance between the three of us - one way or the other.

6a00d8341c660f53ef01347feb4527970c-pi

And a surprise twitter-contact-became-supplier first face to face meeting too. During the "Golden Carrot" brainstorming one lady in the back of the room mentioned an idea about the secrets of proper packaging, being in the transport trade. After one of the breaks I saw her name-badge: Fiona McLellan, which rang a bell. We got talking and it turns out she's the owner of Pharos Parcel, the transport company we now use for parcels instead of ParcelForce. Reasons for switching? Pharos' online booking system is simple, straight forward and covers all that you need, no whistles or bells attached. That, the excellent experience we (and our clients) have with Pharoh Parcel and the regular collection van driver plus the more than competitive prices for parcels, leaves me with absolutely no second thoughts to recommend Fiona and her company to anyone who needs to send out parcels (and/or large items) on a regular or irregular basis.

Sizzling brains, future plans

On the train journey back (so short, we arrived in Ashford before we'd finished brainstorming!) we'd discussed various topics covered during the fast-paced Seminar and added more ideas/plans to the "to-do-list". We always learn or see new angles to grow our businesses - and this is how it should be IMHO.
Plus we have the CD-rom from the Web Strategy Live to keep us going and on our toes! This CD-rom is filled with short videos, templates, worksheets and much more.

More Seminars planned

Ed has more Web Strategy Live seminars planned, you can register your interest here and if you go, give him our regards! Thanks for a very interesting, learnfull and enjoyable day Ed.


Taxing thoughts

The next UK election was announced last week, as if nobody was expecting this! Even more News programs "dedicated" to the political parties, even more "insight" interviews - be at with the party leaders or political experts - and even more promises, promises and promises in manifestos.

Problem with Governments is - no matter which colour - they have this insatiable habit of taxing those they are supposed to govern. And at the moment all it feels like is that every party is trying to figure out whom to tax more will bring them the most voters.

I've made a small list of all the taxes brought upon us (personal and business tax) by governments past and present (has there ever been a time governments did not tax their people, is that their main purpose?):

  • Income tax - because you contribute to the economy by working (and spending your money)
  • National Insurance - because you contribute to the economy by working (and spending your money)
  • Council tax - because you live (work?) in the area the council governs and spend your money there
  • Road tax - to keep the infrastructure going to support the economy (pot-holes anyone?)
  • Business Rates - because your business is in the area the council governs and you contribute to the economy by employing locals and spend money there
  • Corporation tax - because you contribute to the economy successfully
  • VAT - because you contribute to the economy by spending your well-earned money and as business are appointed VAT collection office
  • Tax on savings - because you are prudent with your well-earned money to keep contributing to the economy
  • Excise tax on various items (on top of which VAT is added!)
  • Stamp Duty - because you are contributing to the economy successfully and have been prudent and wise to have saved (tax on that) enough to make a deposit on your own home (home-ownership encouraged by Governments)
  • Inheritance Tax - because all your well-earned money and possessions you gathered so prudently are somehow when the time comes not to be passed on to your partner/children without the Government taking (again) their part of your hard work
  • And I'm sure a left various taxes out
Makes you wonder. It seems no matter how much you contribute to the local/regional/national economy or how prudent you are during your whole life, the only persistent item is TAX. No doubt a fact known for ages.
The only influence we seem to have on which tax will be bestowed upon us next, is to vote for that party that'll suit our circumstances/interest best.
(One problem there though for me and my partner: we are allowed - more than allowed even, if we don't we'll be prosecuted - to pay all those taxes, but due to having the wrong passport we are not allowed to vote for the next UK Government that'll no doubt tax us even more. Just a little side-note for you, nothing you can do about this, I think.)

What makes me wonder most though is why? Why does it seem the main purpose of a Government is to tax us one way or the other (and often twice on the same matter).

Because, you will no doubt tell me, it pays for....... (fill in a multitude of reasons, from schools, hospitals to roads and this or that committee and lets not forget the benefits for others - those out of work or disabled so they cannot contribute to the economy as well as we can and do).

But is that truly so? Can't we just pay for all those items we need when we need them? But not everyone is so prudent to save for later or is able to work, I hear you say; "we have to be fair, we live in a democracy where we share" I know you are thinking.

Barter makes the world going round, the world going roundI know, too much water on the bridge already. Once a ruler/Government starts taxing its population there is no going back to the barter principle (pay as you go/need in which ever means available/acceptable by the other).

But is there? Too much water under the bridge, I mean. No period has seen so many advancements in technology, in medicine, in democracy than the last 15 - 25 years. Why haven't we been able to rule out taxes? Most things are getting smaller, cheaper, more readily available for all. Only tax is getting bigger and more expensive; the divide between poor and rich, between have's and have-not's is getting wider, not closer.

Perhaps I'm wondering about the wrong issue. Perhaps higher tax, more tax is the result of the same principle that allows this divide getting wider. Greed and habit - or should that be the habit of greed?

If we all stopped paying tax, would the world end? If we all started to barter, would the divide grow or would the greed stop?

Taxing thoughts this.


Survey results on "Has Ashford delivered the Boom?

Beginning March I asked the question "Has Ashford delivered the Boom?" here and on the LinkedIn Group East Kent Business Network.

In total (only) 7 businesses took part in the survey till now with the following result - all from East Kent Business Network members:

6a00d8341c660f53ef01347f97bb35970c-pi
6a00d8341c660f53ef0133ec67defe970b-pi
6a00d8341c660f53ef01347f97bb85970c-pi

The results of question 3 bags a few new questions for me personally (running a business Supplying high value products to domestic clients in the Ashford borough):
Does the East Kent Business Network group mainly contain B2B businesses?
Or are B2C business owners not very prone to take part in a survey?
Is On-line marketing a category on its own? (Don't mean this cynical, and hope the person who wrote this doesn't feels hurt).

6a00d8341c660f53ef0133ec67df47970b-pi

A significant majority says NO. (100% is very, very significant in my book.)

6a00d8341c660f53ef01347f97bb96970c-pi
6a00d8341c660f53ef0133ec67df99970b-pi

Plenty of work to do for Ashford's committee "Ashford Best Placed in Britain" it seems or the borough's Economic Development department for that matter.

6a00d8341c660f53ef01347f97bbed970c-pi

Maidstone and Canterbury seem to be scoring highest in the perception to deliver more to/do more for businesses than Ashford does.
Hmm, moving?

Had really hoped the survey would have attracted some businesses in "the known" - estate agents come to mind. If there is an increase in commuters to London from other places moving to Ashford Borough now, they should be the first to know. Anyone?

Thanks to all who took part in this simple, short survey. Wonder if we should notify Ashford Borough Council of the results - or would they know already that according to most businesses they failed?

Access to the survey will be kept open till the end of this month - perhaps this Spring will bring more green shoots for Ashford? Feel free to enter you own thoughts - the survey can be found here.


About Influence, perceived Authority and Freedom

The last set of books I bought from Amazon also counted one I had already read - but then a revised version of it (and I do tend to re-read books anyway, so no harm done really).

Robert Cialdine's "Influence, the Psychology of Persuation" - revised

6a00d8341c660f53ef013110082037970c-pi

Robert's book focuses on how we human beings so often take the easy way out when it comes to making a decision. A decision to buy something, to accept something, to agree to something and many other daily decisions. From fairly simple matters to big life changing matters. We tend to take the easy way out.

He calls it the click/whir reaction: we encounter a situation that requires us to think and decide, something triggers the easy way-out option (the click, the correct tape is placed in our head) and we take an almost snap decision (the whir, the standard message on the tape - or here: the triggered standard reaction onto which we base our decision).

Triggers: reciprocity, commitment and consistency, authority, social proof, liking and scarcity

Some triggers are scary reading: the title of doctor has proven to be enough to follow instructions that could (has) result(ed) in administering wrong medicine (by highly trained nurses), the pin-striped suit is enough for a crowd to cross a busy road because a pin-striped suit does so and they simply follow.

And we all do, because authority and social proof of what others do, say gives us the easy way out and we don't have to think (takes time, plus we risk missing out) for ourselves. We're trained in this click/whir response since childhood.
(Funny example of this click/whir reaction can also be seen on Drew McLellan's blog in his post "How potent can brand be?")

Cialdini gives per trigger solutions or realisations to prevent you from being persuaded by this click/whir reaction - hard to do when it seems to be ingrained in our Western Society.

Eric Frank Russell's The Great Explosion

The book, specially the chapter about authority, reminded me also of one of my long time favourite Science Fiction Novel: The Great Explosion - Eric Frank Russell. The only real science fiction bit is the characters travel in a space ship, the classic book is more about bureaucracy and mindless following of rules (indeed. again click/whir).

To make my point how ingrained we are I copied the following from The Great Explosion to show how we (often mistakenly) accept authority to know it all, to guide us. The copied text starts when a crew-member is sent into a nearby town on the planet the ship has just landed on and first tries to find the government/authority have failed (misserable). His quest to comply with the orders he received goes like this:

Tenth Engineer Harrison reached the first street on either side of which were small detached houses with neat gardens back and front. A plump, amiable looking woman was trimming a hedge halfway along. He pulled up near to her, politely touched his cap.

“Scuse me, ma’am, I’m looking for the biggest man in town.”

She part-turned, gave him no more than a casual glance, pointed her clipping-shears southward. “That would be Jeff Baines. First on the right and second on the left. It’s a small delicatessen.”

“Thank you.”

He moved on, hearing the steady snip-snip resume behind him. First on the right. He curved around a long, low, rubber-balled truck parked by the corner. Second on the left. Three children pointed at him dramatically and yelled shrill warnings that his back wheel was going round. He found the delicatessen, propped a pedal on the curb, gave his machine a reassuring pat before he went inside and had a look at Jeff.
There was plenty to see. Jeff had four chins, a twenty-two inch neck, and a paunch that stuck out half a yard. An ordinary mortal could have got into either leg of his pants without bothering to take off his diving suit. Jeff Baines weighed at least three hundred pounds and undoubtedly was the biggest man in town.

“Wanting something?” inquired Jeff, lugging it up from far down.

“Not exactly.” Harrison eyed the succulent food display and decided that anything unsold by nightfall was not thrown out to the cats. “I’m looking for a certain person.”

“Are you now? Usually I avoid that sort—but every man to his taste.” He plucked a fat lip while he mused a moment, then suggested, “Try Sid Wilcock over on Dane Avenue. He’s the most certain man I know.”

“I didn’t mean it that way,” said Harrison. “I meant that I’m searching for somebody particular.”

“Then why the blazes didn’t you say so in the first place?” Jeff Baines worked over the new problem, finally offered, “Tod Green ought to fit that specification topnotch. You’ll find him in the shoe-shop at the end of this road. He’s particular enough for anyone. He’s downright finicky.”

“You persist in misunderstanding me,” Harrison told him and then went on to make it plainer. “I’m hunting a local bigwig so that I can invite him to a feed.”

Resting himself on a high stool which he overlapped by a foot all round, Jeff Baines eyed him peculiarly. “There’s something lopsided about this. Indeed, it seems crazy to me.”

“Why?”

“You’re going to use up a considerable slice of your life finding a fellow who wears a wig, especially if you insist that it’s got to be a big one. And then again, where’s the point of dumping an ob on him merely because he uses a bean-blanket?”

---------------------------------------

He groaned low down, then informed, “I’m chasing the mayor.”

“What is that?”

“Number one. The big boss. The sheriff, pohanko, or whatever you call him.”

“I’m still no wiser,” she said, genuinely puzzled.

“The man who runs this town. The leading citizen.”

“Make it a little clearer,” she suggested, trying hard to help him. “Who or what should this citizen be leading?”

“You and Seth and everyone else.” He waved a hand to encompass the entire burg.

Frowning, she asked, “Leading us where?”

“Wherever you’re going.”

She gave up, beaten, and signed the white-coated waiter to come to her assistance.

“Matt, are we going any place?”

“How should I know?”

“Well, ask Seth then.”

He went away, came back with, “Seth says he’s going home at six o’clock and what’s it to you?”

“Anyone leading him there?” she inquired.

“Don’t be daft,” Matt advised. “He knows his own way and he’s cold sober.”

Harrison chipped in. “Look, I don’t see why there should be so much difficulty about all this. Just tell me where I can find an official, any official—the police chief, the city treasurer, the mortuary keeper or even a mere justice of the peace.”

“What’s an official?” asked Matt, openly baffled.

The complete story is available online here - look for chapter 9 if you want to find out immediately if Harrision did manage to find an official - it does make you think about what we have come to take for granted.

Freedom to decide for ourselves does seem - again - further away from us than ever. Until we realise that the click/whir response is making the decisions and not our own free mind.

Freedom - I won't (#f_iw)