Who is your customer? Many businesses would like to believe that what they have to offer is something that everybody wants or needs. One of the biggest challenges business owners must overcome in order to monetize successfully is the misconception that their business has the magic ability to “offer-everything-for-everyone.”
On the surface, this may seem like a sure-fire way to get more customers, right? However, it’s been proven time and time again that for 99.9% of companies, this is not the way to prosperity.
Let’s take a closer look.
As a small business owner, chances are you planned a limited marketing budget and if you are retail you have limited space. Let’s continue to use our furniture store example. If your store offers several contemporary collections, several ultra-modern and some eclectic pieces mixed in with some early American collections, do you really think that you have enough inventory of any single style to satisfy customers looking for a specific look? The answer is most likely “no.”
In fact, the most successful furniture retailers focus on a couple of things/unique selling points to attract a specific type of customer, such as:
- Complete living room packages for under $2,000 or furnish your entire home for under $5,000.
- Long-term low or zero interest financing.
- Fast delivery within three days or less.
- Lower prices for packages.
Do you see what they are doing? By focusing their advertising on the benefits of purchasing with them rather than another furniture store, they attract customers who purchase multiple pieces. For this company, this monetization strategy results in an increased average ticket sale along with an increase in profits.
Why does this work so well??
Why does the generous financing strategy work so well? First, it attracts customers who are looking to buy now and have good credit for financing. Second, it encourages them to spend more money, because they don’t have to pay for it in cash right now.
Third, almost as a stroke of often overlooked genius, the more merchandise the customer buys, the bigger the discount the customer receives. Do not overestimate the value of allowing the customer to feel as if they are practically “stealing” the product from you!
So what is the twist?
Here is the twist with these particular retailers– although they attract customers to their business with generous financing offers, they reward their salespeople handsomely for NOT selling the long-term financing. They actually give their salespeople an incentive to get customers to pay off their balances in less than 30 days, bringing the full value of the sale to the merchant in a shorter period of time.
These are just a few monetization strategies that successful businesses use to attract customers without focusing exclusively on price. Do they miss out on a few customers? Possibly. However, they focus their marketing on a targeted group of qualified customers so that the conversions coming in the door can be greater. At the end of the day, it’s the conversions that put dollars into our bank account, not traffic, right?
“There are riches in niches.”
Simply put, this slogan means you need to determine who is your most profitable, enjoyable, and easy-to-attract customer. Create and understand your “customer profile.” Once you understand whom you best can serve, specialize your marketing so that you attract more of these customers. Don’t worry over the “one’s that got away,” there are plenty that will easily come to you, with the right marketing.
So what does the “right marketing” include? Yes, there are lots of little tactics that we will talk about. However, one of the core strategies is to create a U.S.P. (Unique Selling Proposition). Your U.S.P is what makes you Extraordinary and Special in the eyes of your customer. It’s that “thing” that you’re known for. It’s what compels your most profitable customer to come back into your business again and again.
This is your “YES FACTOR,” why people will say yes to you over your competition.
Need some Coffee??
Let’s look at Starbucks. They are a pretty successful company, wouldn’t you agree? Why do people line up every morning to get a cup of fancy coffee from Starbucks instead of going to their local 7-11 or mini market to get that same morning jolt? Think about it, how has Starbucks positioned itself? What has Starbucks done to make their whole coffee experience “unique” in a market that is built on a commodity?
And, more importantly, how can you generate that same type of excitement to experience your company, concept, product, or service? How to you develop your own U.S.P?
Whether you’re selling online of offline the first step in developing a U.S.P. is to develop a customer profile for your most profitable customer. Yes, there are some products that appeal to almost everyone. However, when you have a better understanding of WHY that product appeals to that person, what their motivation is, it will be much easier to develop a marketing plan that works.
What’s the info you need to know?
In order to do this, you must know information like:
- How they found your business
- Where they live
- What newspapers and magazines they read.
One little trick to discovering some of this information is to visit the demographic section provided by magazines that your customer frequently reads. These large companies spend a lot of money to build their own profiles for advertising purposes, so why not build off of this great research?
How else can you define your ideal customer? Luckily, thanks to Al Gore and the Internet, the process is really a lot easier than it sounds and a lot of the guesswork can be taken out of the equation.
Start with Google’s search engine. Simply type in your product or service, your niche, and take a look at the websites that come up on the first page.
For example, let’s look at “eclectic furniture” and look for a result that is geared toward a store, rather than just a general blog.
Next, go to www.Quantcast.com and type in the URL for one of the top results
You can get some great demographic information from this site that will help you build your customer profile.
In this example, you can see that the customer for eclectic furniture is:
- 54% Female
- Ages 35-44
- No Kids
- Income range over $100K, slightly higher above $150K
- Education: College Graduate and Post-Graduate
Don’t you think that having this information in hand will help you design, script, and create a marketing campaign that will be more effective?
Suppose you discover this surprising information about your ideal customer:
- Professional woman who initially visited your business without their husband
- Recently married
- No children
- Lives within 15 miles of your business
- Spends between $300 – $1200
- Pays by Visa, MasterCard or Discover
With this information in hand, you can create your businesses marketing to attract the kind of customers that are currently spending money in your business; those who want, and can afford to purchase. Building profiles is one of the details that many businesses don’t take the time to do. However, when you invest this time, you will be one step ahead of your competition, because most businesses never do this research!
P.S…. if you are ready to monetize your business more effectively and accelerate your business results, let’s connect. I know we can help.