Do You Really Know What Business Marketing Is?

There are countless books and courses on marketing and how to do it properly. You’ve probably read or attended some yourself. But, do you feel like you have a good grasp of marketing?

Do you fully understand all the processes involved and how to best apply them to your company? When all the cards are on the table, most small-to-medium businesses don’t. Or at the very least, they understand these concepts.

What Is Business Marketing?
Everything a business does, everything you do to sell products and services – is marketing. Every decision you make, if it’s about how to put your products or services in the hands of consumers, is business marketing.

The foundations of marketing are relatively easy to explain and understand. But mastering these essential concepts can mean the difference between success and failure.

You don’t have to micromanage all marketing that your business does. In fact, it’s probably a good idea to hire a professional. However, that doesn’t replace the need to have a solid knowledge of marketing strategy. Business owners should always have a proactive role in their company’s marketing tactics.

Essential Components of a Good Marketing Strategy
Not all marketing concepts will apply to every business. Some will be more relevant than others, but as an entrepreneur you should be familiar with all of them.

Inbound Marketing
Think of inbound marketing as your workhorse.

It’s a set of marketing tactics designed to maintain a steady influx of customers into your sales process. This isn’t about pushing your brand to generate leads or direct conversion.

Inbound marketing uses various channels in creative ways to reach as many people as possible. Tools such as SEO optimization and social media channels are ideal for this type of marketing. The goal is to drive high volumes of quality traffic that can convert through brand engagement in the long run.

Direct Marketing
If inbound marketing is your workhorse, think of direct marketing as your racehorse.

Direct marketing includes sales tactics designed to produce an instant response. Things like calls to action in online or broadcast media fall into this category.

Regardless of what else you do, direct marketing is an important part of any marketing strategy. It allows you to instantly measure success or failure based on response rates.

Knowing how people are responding to one offering versus another is crucial.

Outbound Marketing
This is where the rubber really meets the road.

In outbound marketing, you’re reaching out to prospects and basically saying “buy from me.” This is typically what people think of when they hear the word marketing.

Outbound marketing includes sales calls, print ads, broadcast ads, door-to-door sales and much more. Any activity in which you’re reaching out to potential customers with an offering figures into this definition.

Though a staple in countless marketing strategies, it’s not very effective. It’s hard to figure out if it’s really working and people are getting savvier and blocking the majority of this type of marketing.

Content Marketing
This is the new-old way to market.

Most smart businesses realize that people are OK with marketing, as long as they get something in return. For example, if you create great content, consumers will be happy to hear from you.

Therefore, every channel you have should start by giving value in return for your customers’ attention.

Social Media Marketing
It is inescapable, omnipresent, and pervasive.

Marketing is about getting attention. If you can’t get people’s attention, you have no one to market to.

The biggest attention vacuums nowadays are social media platforms. It goes without saying that any marketing strategy that doesn’t include social media, is off to a bad start.

Start with Solid Foundations
Each of these components has its own place in the puzzle. Some may be more important to your business than others. But only by understanding them all can you find your way out of the marketing madness.

Don’t be a passive business owner. Take charge of your marketing strategies and stop wasting resources on marketing that doesn’t deliver.

Break Even On Your Next Direct Mail Campaign…And Still Generate Huge Profits

With direct mail, you can break even and still claim success. The reason for this can be understood only when determining the lifetime value of each customer brought in and the likelihood of those customers responding to subsequent offers. Here is a concrete example to illustrate my point.

Joe’s Civil War Shop

Joe owns a Civil War souvenir shop. Yes, believe it or not there is a rather large market of Civil War nuts who collect anything from old bullets, to swords, to manuscripts written by confederate generals. Joe’s sales have been slowing since he is located in Virginia, the capital of Civil War memorabilia because this market has saturated itself from having close local stores to buy collections from.

So, Joe decides he wants to sell nationwide through direct mail. He goes out and gets the best Civil War nut list he can find (no offence Civil War lovers…), hires the best copywriter he can afford and sets out on a little campaign of his own…a direct mail campaign.

His sales letter sizzles. Orders come in at a respectable rate, but after he tallies the results he discovers the cost of the mailing just about breaks even with the orders that came in.

My question to you is this:

Should Joe abandon this project or continue?

This is a big decision he has to make. What would you do?

Continue If Your Existing Customers Will Buy More From You

The correct answer is really very simple if you understand the lifetime value that each customer on average brings you.

Let’s say, on average, Joe’s customers pay around $65 for each order they make. But Joe knows Civil War nuts normally can’t stop at just one item. Once Joe establishes a strong trust with his customers by shipping promptly, providing products that match expectations and satisfies the desires of his customers, then on average those customers are likely to buy 2, 3 or more times per year from Joe. So lets say on average a customer buys 3 times a year from Joe. This comes to about $200 a year.

Now after Joe “breaks even” a few times, he will have accumulated a good set of loyal customers provided he shipped on time, provided a great product, offered strong guarantees and gave prompt assistance whenever questions came up.

Now Dig The Gold From Your Loyal Paying Customers

Now, lets go back and see what happens when Joe sends a sales letter to ONLY his core customers that actually bought his products. What do you think his response and order rate will be? His customers already have shown to be hungry for his products. He has more to offer. If he throws in a special offer to his “best customers”, his response rates could be 30% or more.

So by “breaking even” Joe has built a strong customer base loyal to him. Now I ask…did Joe really break even? Of course not, he will make more money later on reselling to the customers he captured on the break-even mailings. At this point he would be stupid to stop after the first mailing.

Does Your Customer Base Fit This Profile?

If you want to use direct mail to expand your customer base, keep this in mind and ask yourself:

“What can I afford to spend to bring in customers who will continue to respond and buy my products at a rate that more than justifies the cost of the mailings and brings a worthwhile profit. Each business will have different ways of calculating this…in Joes case I’ll step you through it.

Let’s Crunch The Numbers To See How To Profit

We’ll use a starting 1000 mailing list as a base. Lets say it costs $800 for the mailing. $200 for copywriting, $100 for the list and $.50 for postage and cost of shipping. The total cost is $800 ($100 + $200 + ($0.50*1000)). Now to break even Joe would need to sell 12 products at $65. $12x$65 is approximately $800. That would be at a 1.2% response rate.

So Joe just broke even…now lets see what happens if Joe sends 3 mailings to those 12 customers at a 30% response rate…

30% is about 4 customers. If each order is $65 then 4 x 65 = $260. Now this time sending mail costs only $6. So this time Joe made $254 dollars mailing to only 12 customers!

Let’s Try It On 10,000 Mailings

Once we use 1000 customers to find our winning sales letter that gets just a 1.2% response (of course a better response will mean more money), lets see what happens when we roll this out to a real list of 10,000.

With 10,000 mailings and 1.2% response, sales = $120*$65 = $7800. The sales letter has already been written, so no charge. Therfore, $7800 (sales) – $5000 ($.50 for each letter — 10,000 letters) = $2800 in sales.

30% response on future mailings to 120 customers is 40, so 40*$65 = $2600 in sales! Subtract out the cost of the mailings of $60, then the final sales is $2540 from just 120 people! Now do this 3 times a year and you’ll likely make $7620 or more extra per year!

Test, Decide, Profit

With a few test mailings to 500 ot 1000 people in your market, you can determine what your profits will be when you roll it out to 10,000. In this case, if you market is made up of 100,000 people, you stand to make $76,200 per year with this campaign. And let’s say the average product is $130 dollars…you can make $152,400 per year!

I hope you can see the power of careful testing followed by controlled follow-up with your customers. Use the simple calculations I showed you in this example and see if they may work with your own products. Remember, test your first mailing on a small list of 500 or 1000. Do this until you get a response rate that justifies rolling it out to more people. Also, know your market. Calculate how much the average customer is likely to buy over the course of a year. If it all adds up…go for it!

Next article I’ll show you another way to leverage your existing customer base to make even more money. Stay tuned.

(Disclaimer: The information contained herein is meant for educational purposes only. The reader is solely responsible for any actions made based on the information contained in this article. Many factors affect success such as product, mailing list, offer, sales letter, etc.)

Online Marketing Blog: The Benefits Of Blogging

Blogs are first intended as means of expressing one’s thoughts and opinions. Then, they gradually became a tool for publicity for celebrity and paparazzi. Later, blogs were picked up by the business world and used as a tool to promote their sites, create more online presence, and expand their businesses. From simple web pages, blogs have become an important online marketing instrument that can benefit both small and large businesses. Here are the benefits of blogging in online marketing:

Brand Building
A marketing blog builds your brand as easy as making one post per day. Blogs help you to generate not only online presence, but also brand recall, making it possible for your business to become known to whoever has access to the internet.

SEM or Search Engine Marketing
Blogging is a great way to generate organic traffic and a great way to directly communicate with your clients, but more importantly, if you are running a marketing campaign, it helps you generate traffic.

Inexpensive
Blogs are generally very cheap compared to other online marketing campaigns. You can just hire one blogger who will maintain one or many blog sites as well as update contents daily. Or, you can simply write one blog per day about your business and it will easily build online presence and reputation. And as long as blogs stay live, your content is valid and can be picked up for many years to come.

Accessibility
Users do not need to sign up to view your site. They can open, read, write comments, and get information easily without the time consuming process that is more common with other marketing tools like online forums.

Direct link to customers
Other forms of marketing tools do not quite match the power of blogs. Because your clients can post comments in blogs anytime, businesses can get instant feedback and can send messages back to the clients to provide answers to their queries. This makes the business more connected to the customers, providing a sense of personalized service.

Reputation building
Image is crucial to any brand. Any problem of your company or complaint raised by customers can be damaging to your business. If not addressed as quickly as possible, your reputation will suffer. Blogging helps your clients to discuss these issues directly to the business. You can then send replies to your clients addressing these issues right away, protecting the business from any damage that may result from any unresolved or unaddressed concerns.