Archive for the ‘branding’ category

2 Concepts for Improving Your Brand

July 19th, 2014

Improving, or repositioning, a brand has a direct impact on the financial performance of a business. Companies that are successful in building their brands enjoy higher customer loyalty and are more likely to attract new customers. An improved brand has a positive impact on profit margins and allows a company to raise its price without becoming less profitable due to a reduction in business. A stronger brand leads to increased market share, revenues and profitability.

Understanding the two concepts of actual value and perceived value, and applying them to your product or service’s brand can help you increase margins for your business and make more money.

Soda sells for 75 cents at the grocery store or $8 at an amusement park. Steaks are priced from $18 at a casual restaurant to around $40 at a fine dining establishment. A cup of coffee can range from one dollar to well over $5. The vast difference in these prices is a result of brand positioning and the value that the brand represents in the marketplace.

If you want to increase prices in your business and make more of a margin on each sale, analyze your brand to see how you can reposition and improve it to be more valuable in the minds of your current and potential customers. Do this by boosting actual value or perceived value.

1. Actual Value

Increasing actual value likely will cost your business more money but will enable you to charge more too if your customers care about the improvements. For example, in the auto business, a sunroof, leather seats and chrome wheels are considered upgrades. It costs manufacturers more to install these, but since car buyers think these features make a car more comfortable, sporty, luxurious, durable or attractive, these add-ons increase the value of the car, and customers will pay more for it.

In your business you are adding actual value when you are paying more on a continuous basis for the cost of materials or labor to improve the customer’s view and desire for your product or service. In the case of the cars, the sunroof, leather and chrome wheels must be added or available every time in order to offer the increased value and capture the added profits that result. Using premium or preferred materials or skill sets rather than just good or good enough materials and labor will allow you to have higher price points if your add-ons are desirable to your customers.

2. Perceived Value

Increases in perceived value are generally more profitable than increases in actual value because you do not necessarily have to spend more money, or any money at all, to achieve increases in perceived value, but you can still charge more for the added value.

Consumers will pay higher prices for attractively packaged products. Making a product package more attractive may not cost more. It can be as simple as using a brighter or darker brand color, a more commanding or refined font or a different shape of bottle. These changes can make a product appear richer or of higher quality, yet the inside product may be the same as a lower priced competitor. It’s all about the perception.

Associations, affiliations and trust also boost perceived value. For example, two identical products may sell for vastly different prices if one is associated with higher professionalism, expertise, style, or just plain fun. For example, if a product is worn, used or favored by celebrities, then it suddenly achieves higher perceived value.

Professional certifications work the same way. A Certified Public Accountant (CPA) may be able to charge a more for bookkeeping and services than an accountant with a degree but no certification. If the CPA is better at the work, it isn’t necessarily due to the certification, but the perception is there for the CPA to leverage.

Protect, build and analyze your brand to figure out ways to boost value for your customers. Whether it is actual or perceived the added buzz and sales can help you reach your annual profit goals faster.

Cool Product: Constant Contact

May 3rd, 2012

email marketing made easy

I’ve been using Constant Contact to give my emails a professional look for almost a year and a half. I’ve now put out 17 issues of my newsletter, The Small Biz Bulletin (get it free – see the Join Our Email List link to the right —–>), and have noticed that dozens of businesses on my emailing list have adopted this product for their use too. So, it’s high time I did a Cool Product Review on it.

Constant Contact email combines your email campaigns and your social networking efforts into one easy-to-use service. It’s intuitive and easy to use for all skill levels. It breaks down the set-up process into three easy steps: “Create the look, select your audience, then schedule and send.”

Email Campaign Creation

You start by picking one of over 400 templates as the basis of your email, or create your own. The templates come in a variety of layouts, colors and patterns, are easy to customize as well as to insert text, images, documents, blog content, links, surveys, polls, videos and more. There’s a social-share toolbar and buttons for Facebook, Twitter, Google+, LinkedIn and others to send readers directly to your various social media properties.

Campaign Reporting

You’ll get comprehensive reports on your campaigns, including bounces, spam complaints, opt-outs, click-throughs, forwards and more. And Social Stats reporting tools tell you the number of Facebook shares and likes, tweets from Twitter and more, that your messages receive. You can also see the number of total social shares and page views your email campaign has generated.

Contact Management

You can add customers to your list by typing them in, importing a spreadsheet list or your address book from Gmail or Outlook. Contact fields are customizable so your contact database can hold all the info you need to keep on each contact.

Help & Support

Support includes a searchable knowledge base, tutorials, FAQs, a user manual, a blog, user forums, recorded demos and webinars. And the phone support is the best I’ve ever had for any product I’ve ever needed help on. They will even edit your email directly to fix a problem.

Try Constant Contact for Free!

You can try Constant Contact for free for 60 days to see if it fits your needs. If you do want to try it, click on the link below (or the logo at the top) and you will also receive a $30 credit when the free trial is over. Full disclosure: Yes, they will be kicking me back a $30 credit too, but if a couple hundred of you stick with it, well it could be sweet! Thanks!

Click here to get your 60 day free trial and your $30 credit if you continue beyond the trial period.

 

Retaining Your Current Customers

April 26th, 2012

When focusing on growing your small business, acquiring new customers should probably be at the top of your list. And that would be the best possible approach for a startup company. But I would suggest that the most important thing for any established business is to keep their existing customers.

You have probably heard this before; it is far less expensive to retain old customers than to acquire new ones, but you should also ask yourself what is the point of acquiring more customers if you can’t hold onto your existing ones? Also, what is the cost to your brand of all of those defecting customers? Are you just replacing angry customers with ignorant ones?

In a world of increasing competition and ease of defection to other products and services, building and focusing on keeping your customers longer can be a significant way to grow your business. Realize that:

  • Businesses in many industries may lose up to 50% of their customers over a five year period.
  • Studies have shown it is 5 to 7 times more expensive to acquire a new customer than it is to retain a current customer.
  • As little as a 5% increase in customer retention can increase profits by 25 to 95%.

Unaware of these figures, many businesses still focus on acquiring new customers as their primary growth strategy rather than protecting and nurturing those they already have.

Why do customers leave?

 Before we can start keeping customers, we first have to try and understand why customers leave. Studies tell us that the main reasons customers leave, or stop doing business with a specific company are:

  • 1% die
  • 3% move to another area
  • 5% are influenced by friends or contacts to go elsewhere
  • 9% are lured away by your competition
  • 14% don’t stay because they are disappointed with your product or service
  • 68% leave because they perceive an indifferent attitude toward them

Furthermore, research also shows that there is a significant difference between the reasons that companies think customers leave and what their customers actually think. If these findings are true then they have huge implications for business. They suggest that loss of customers is not so much about how good your product or service is, or how competitive your industry is, but rather it’s more about how you are with your customers, and how much they believe you care about them.

The implications of this falls into a few areas that businesses need to focus on:

  • It’s not about you (the business), it’s about them (the customer)
  • Customer service/care involves everyone in your business not just your customer-service people
  • Your relationship with your customers. This may take some time, effort and a lot of trust in your front-line staff because everyone is different and technology and systems are not always the best way to solve a problem. Sometimes it’s about just being a bit more human, taking a bit more time and a longer view of the relationship you have with the customer.

Want to improve your retention of customers? Here are a few steps to help you get started:

Get to know your customers

This is not just about how long they have been a customer or how much money they spend. Get to know them, find out what they like, what they don’t like, ask for their opinion on how you could better serve them.

Segment your customer-base according to their similarities

Segmenting your customers into different groups will make this project easier and allow you to track retention progress in each group. Create a strategy to get to know each group of customers that focuses on their expectations. Since each group is different, it is reasonable to expect they will have different preferences.

Decide which customers are going to work for your business

This is where reality and tough choices kick in. Not all customers are going to be a good fit for your business so choose which customers will work and be very clear about which ones will not. If you can identify the customer that will be disappointed with your customer experience as it does not fit with their needs and you choose not to do business with them (in the nicest possible way), then you will have saved yourself a lot of time and energy and brand equity in the process. They’ll appreciate the honesty. Refer them onto someone who will be able to fill their needs and you’ll create an advocate for your business.

Use Customer Relationship Management software

You’re going to need to have a way of gathering and storing the information about your relationships with your customers. This is where Customer Relationship Management (CRM) technology can lend a hand. Talk to an expert about this but don’t be led by the technology. Let your customers lead.

Measuring your progress and success

Set targets, monitor and measure your progress. It’s the only way that you will know if you are improving. However, realize that this can take time and will depend on the nature of your business and current relationships with your customers.

The results of improving your retention

The process of creating a focus on customer retention is not easy, and it takes time. But when you put it all into place you will be pleased with the results. Listening, learning and paying attention will get a positive response from your customers, and that means more business for you. Once you establish a learning relationship with your customers, you can develop a partner-like relationship. And at that stage, you’ll be able to meet and exceed their expectations by anticipating their needs. The deeper the relationship and more complex their needs, the more they will appreciate your relationship with them and the less likely they will be to move their business elsewhere.

Customer loyalty has a direct impact on the market value of your business

It’s been said that the most valuable asset a company possesses is not its buildings, employees or intellectual property, but its customer list. And that’s certainly a defensible position to take. A true entrepreneur, stripped of his or her entire infrastructure, could conceivably rebuild from scratch with only a list of proven buyers.

Interestingly, anyone who may wish to acquire your business will assess your company’s market value by taking your customer list into account. Should you ever choose to sell your business, it will be easy to point to a well-maintained customer list and express customer loyalty as a considerable value.