December 8/15, 2014; Volume 28/Number 12
By Jim Augustus Armstrong
This is the third installment in a series FCNews published back in 2007. Here we continue with mistakes 6-9.
Mistake No. 6: Failure to have a system to generate referrals.
In my opinion, this is the second biggest marketing mistake. (The first is not marketing to your past customers, as noted in my previous column.)
Let’s say that you have a database of 1,000 customers. Even if those customers are very loyal, there is a good chance that in any given month, few (or none) of those people need your services. However, each has a sphere of influence of at least 200 others, which means 200,000 potential customers. Each month dozens to hundreds from that group will need your services. By having a system in place that taps into your customers’ sphere for referrals, you expand your market exponentially.
Mistake No. 7: Never testing new marketing methods.
There can be severe negative consequences for relying too heavily on a single strategy. What happens if that strategy suddenly stops working? I know a business owner who was generating 30% of all new customers from a single sales letter, and it worked well for two years. Then it suddenly stopped working. Fortunately, he had several other strategies in place, but initially he lost a third of his revenue from new customers and it caused a real cash crunch as he struggled to replace the method that eventually failed.
Mistake No. 8: Expecting your ads to give your entire marketing message.
Ad space is very expensive, and buying space large enough to present your entire marketing message is cost prohibitive and unnecessary. It is possible to use relatively small ad space to offer free information, which will in turn give a complete marketing message. For example, part of your ad can contain this message:
“WARNING: Don’t call or visit any flooring dealer until you read this free consumers guide. You will learn:
- Six costly misconceptions about flooring
- Three dirty little secrets about installation that the home stores pray you never find out, and
- Five critical questions to ask any floor dealer before you purchase.”
Next, list a web address where customers can opt in for your report.
Mistake No. 9: Assuming your customers understand floor covering.
As a professional flooring dealer who eats, sleeps and breathes flooring each and every day, it is easy to forget that your prospects and customers don’t understand flooring. This leads to several problems. First, dealers and salespeople talk to the customer about features instead of benefits. It is critical that in your sales and marketing efforts you connect the dots for your customers as to how they will benefit from the positive features of your products and services. Second, because dealers assume their customers understand flooring, they ignore the tremendous power of education-based marketing. By educating your customers you help them understand why quality and low price never go together, and why they should invest in one type of flooring versus another. Educating your customers also positions you as a trusted advisor, like a family doctor rather than a salesperson trying to hawk your wares.