What exactly is Return?

Return on investment is a relatively new term for marketers. At seminars it appears we are still trying to determine what the relevant indicators should be. But, there are some things we are certain about though.

I have heard marketeers speak of return in terms of:
"Our marketing investment was this amount and our marketing revenues (return) was this amount". Or, if it's a first effort to be accountable just "Our revenues were this amount.".

But, that is not the appropriate measure. It's not even the most relevant measure.
More appropriate would be to report or consider:

• Our marketing investment was this amount and our profit was this amount.
• What would our profit be if we had not made this investment?
• Would our profit be higher or lower had we made the investment in another vehicle?

I know, in a small market the figures might not always be encouraging. But, there lies our challenge. How do we allocate or re-allocate our marketing investments so that the figures become more encouraging?

Consistent Customer Care

People often wonder how some companies achieve consistently good service. One way is through careful recruiting. Another way is by setting standards for employees. This ensures that what they say, how and to whom are within what the company finds acceptable. This, in turn, ensures a consistent level of service every time. A consistent predictable level of service is also part of your brand.

Setting standards
Does your company have standards? Do your employees know how and how fast you expect phones to be answered and within which time limit to return calls or emails? When to speak to shoppers wandering in the store and what to say? How you expect them to deal with angry customers? To thank for the business and how to do so?

You can also set standards to ensure more up-selling and cross-selling. Some companies’ associates consistently ask: “Would you like dessert with that?” Do you realize that that dessert could add 25% to the sale?

Measure, reward or retrain
Setting standards or providing training without measuring if the standards or training lessons are being applied, is throwing money down the drain. Do you measure if employees are applying what they learnt? Mystery shopping is one way to measure. The results show if you must reward or retrain your employees.

Customer feedback forms
These are also extremely useful, if you use them consistently and with specific goals in mind. For instance, it is better to make sure every customer gets a card and most fill it in on a specific day, than to have 20 cards filled out by chance over a period when you no longer remember what was going on. Do it the first way and you will know where to make changes or which changes were effective. Do it the latter way and all you have is data you don’t really want to process and analyze.

MarkStra can help

• Setting customer care and sales standards
• Setting up and executing mystery shopping programs
• Developing customer feedback programs and processing the forms

Cold calling

About 10 days ago, the "salesperson" in me had her very first true "cold call". That is, a business call to someone I did not know, who did not know me or my company, and whose specific needs I did not know, but who was kind enough to receive me. Obviously, I had my introduction ready and well-rehearsed. True to a small market, it soon appeared that we had several common acquaintances. Of course, that made the conversation go smoother. Since, I made another few relatively cold calls. These are the best practices I liked best:

1. Send a short written introduction beforehand, perhaps by email, stating that you will be calling. By doing so, you will not catch your prospect totally off-guard. In addition, she may be able to refer you to someone else if for some reason she is not the appropriate one.
2. Do some research on your prospect beforehand. It may give you an indication ofwhat to highlight in your introduction. It also shows your interest in the company.
3. Prepare and deliver your short "introductory speech". "Short" is a key word. You want to reveal most of your information once your prospect has told you something about his challenges or needs. This enables you to tailor what you say to his needs and not put your foot in your mouth.
4. Restrain yourself. If you just went for an introduction, don't try to close a sale right then and there. Unless, of course, the prospect states an explicit need which you can readily fulfil.
5. Don't leave without asking who else might be a good person to talk to in the company or elsewhere.

Cold calls are never a lot of fun, necessary to grow your revenues. You see, the prospects that already know what your business offers are likely to consider you anyway when a need arises. It is those who do not know you that form the truly new opportunities.

I have also heard salespeople say that they don't cold call because prospects prefer to deal with providers whom they have a previous or personal relationship with. While this is true, it is also true tha potential customers are increasingly looking for the best possible product or service and are open to hearing about all there is on the market, regardless of previous or personal relationships. The challenge is up to you: start establishing those relationships!

Confidentiality and consultants in small markets

Having someone steal your idea is always a concern. This is especially so in small markets where everybody knows everybody and service providers are very likely to have worked for your competitors already (or do so in the near future).

I have had the good fortune of having clients who were rather trusting and the good sense to honor that trust. But some time ago I met a potential client who was less trusting than usual. It made me think of techniques I have seen applied and have applied myself to safeguard the client's confidentiality.

Of course you can register your idea at your bureau of intellectual properties or ask the consultant to sign a confidentiality agreement. But what if these are not appropriate at the time?

1. Mention the broader product category rather than the product itself. Consultants, marketing consultants particularly, do need some information to be able to make a good proposal for you. How to give useful information, but not reveal all before you are really ready to do so? Mention the broader product category rather than the product itself. If you are going to sell "soap", say "personal care products". Generally all personal care products face the same competitive environment, as well distribution, pricing and marketing communication challenges. So, it's okay to refer to "personal care products".
2. Give a comparison. If you need or want to be more specific, you can say "It's the Rolls Royce of soaps". That gives the consultant a better idea of the issues he may have to take into account when drawing up a proposal.
3. Ask the referee. If you were referred to a consultant by someone, discuss your concerns with the referee first. She may not be able to answer all your questions, but her experience may give you an indication of the integrity of the consultant or his organization.
4. Ask the standard question. When doing market research our first question is usually: "Does a close relative or friend work for such-and-such type of firm?" You can ask your consultant the same question.
5. Voice your concern and wait for the reaction. You can say: "This is confidential, of course." and see how the consultant reacts. Many consultants, ourselves included, have a standard confidentiality clause in our contracts and on our website. It shows they appreciate your concern and have thought about ways to address it.
6. Ask for disclosure. Ask if the consultant has done work in this area and the nature of the relationship with that previous client. You want to know if previous engagements where long-term or one-off deals. Be reasonable, though. The consultant must also honor the confidentiality of previous clients. So, you cannot insist on the previous client's name AND the type of engagement.
7. Be prepared. Read up! If you know exactly what you need, you are more likely to know whether the consultant's questions are warranted or not. Not knowing makes you more vulnerable and more easily suspicious.
8. Don't overkill. Consultants earn their living by providing good solutions AND by keeping their mouth shut. Most of us are not out to reveal client's confidential information. Data or methods that are publicly available or obtainable is not your property, even when you are the first to use them. It is also good to realize that after or even during your engagement, a consultant must be able to earn a living by solliciting and working for other clients. So, a non-compete clause cannot be as broad and exhaustive as you may want it to be.

Comments welcome. This is always an interesting topic in small markets.

What if personal relationships are the experience?

Last Saturday we celebrated the birthday of my friend Angelique with breakfast in Cafe Barista.

We arrived early, at 9 am. Within an hour the small cafe was buzzing with the happy chatter and laughter across tables of dine-in and take-away customers who all seemed to know each other and be part of the same party. I did not know that this was the Saturday morning ritual of "the regulars". But what an experience!

It also made me realize how easy it is to create (or have) a great experience in a small market, just because everybody knows everybody. It reminded me of why I preferred the Curacao carnival to the Trinidad carnival: in Curacao I knew lots of people standing at the roadside, people you danced with a little bit, posed for, or had a little chat with. That is a big part of the experience for me. In Trinidad I knew no one.

It made me wonder if a tourist or someone visiting alone or as a couple would have the same experience in our bars and cafe's or in our carnival. If not, how do we create it for them also?
How about that first-time customer, who does not know anyone and who is not yet loyal, what is his first experience? After you have invested money to lure him, after he has taken the plunge, is his experience good enough for him to come again and become a regular with a good lifetime return for your company?

Strategy and marketing in small markets?

On the internet there are many ideas for small businesses and for big businesses.
But few ideas deal specifically with marketing and strategy challenges in small markets such as Curacao and the Caribbean.
That, while we know that, because of consumer demands and expectations, the future lies in “niche markets” and even “localized” strategy (adapted to preferences of specific cities, neighborhoods, etc.). In our small markets we may easily literally end up with a “market of one”.
How can we overcome these challenges? How can we use and adapt existing tools for our small markets to make it worth our while?

These are the issues I wish to discuss in this blog. It is a thought that I am developing, hopefully assisted by your comments. So, not all posts deal with small markets.

How do you use the Internet?

Last semester I taught a marketing course at Curises. That was one of the issues that encouraged me to start exploring the possibilities of the Internet again. The last time I was really involved with Internet opportunities was in 2000, just before the bust.
What amazes me is how the Internet has evolved, how users and providers have found so many ways to use the technology. I counted 24 "basic" things.
What I would really like to know is what my colleagues, friends and business relations, use the internet for and how much.
Please visit http://websurveyor.net/wsb.dll/87513/InternetUsage.htm and fill out the short questionnaire before February 15th. I will post the results as soon as available.
If you have usage alternatives I have missed, please let me know.