Properly analyze your small business marketing

Even though I have heard this for years, it still amazes me that small business owners make broad generalized statements like: “The yellow pages never works.” I have heard similar statements about door hangers, yard signs, newspaper ads, and nearly every other form of advertising.

Having worked with and spoken to hundreds of small business owners, I have a pretty good sense of what motivates such comments. Typically, a contractor tries some form of advertising, gets poor results, and puts all of the blame on that particular media. Such analysis is superficial, erroneous, and a waste of time.

Many, many factors determine how effective a particular ad will be. Certainly on is the media used. But the ad itself is often to blame, yet few contractors stop to consider this fact. They blame the media, not their ad.

Consider an ad that states: “Lowest prices in town.” This is going to appeal to a certain type of person—the price shopper. The text in the ad will have a large impact on the types of calls—if any—that you get.

On the other hand, an ad that states: “The best value in town” is going to appeal to a much different clientele. Everything else about the ad could be the same, except for the headline, and you could experience dramatically different results.

Another factor that contributes to such hasty generalizations is the fact that very few small business owners properly track their leads. If you don’t know where your leads are coming from, it is impossible to properly analyze the ad’s effectiveness. And when I say know, I don’t mean guesses—I mean actual concrete numbers.

And that leads to the final error many small business owners make—they don’t compute their return on investment (ROI) for each ad. They go on “gut feeling”, which can be wildly inaccurate. Personally, when I get a “gut feeling” I usually take an antacid.

Before anyone can say that a particular media doesn’t work, he must compute his ROI accurately. Even then, all it tells him is that that particular ad did or did not work. Don’t throw out the baby with the bathwater—a bad ad won’t draw well, and that isn’t the fault of the media.

False alternatives can harm your small business

In business, and in life, we can sometimes present ourselves with false alternatives. For example, on a business forum that I frequent, a member asked if he should stress the quality of his product or the quality of his service. But why does it need to be one or the other?

Certainly you want our marketing to be focused and consistent. If you claim that you have the highest quality and the lowest prices your message will be confusing. The two seldom go together. But a quality product and quality service do.

The member wondered how many people would be attracted to a quality product and how many would be attracted to quality service. He wanted to develop his marketing accordingly. But it isn’t either/ or–the two options are not mutually exclusive.

If he stresses the quality of his product, those who value quality service may not be interested. If he stresses the quality of his service, those who value a quality product may not be interested. But if he stresses both, he has covered his bases.

Certainly we shouldn’t try to be all things to all people. That isn’t the case here. Those who value a quality product generally also value quality service. A great product with horrible service does not make for a great experience. Nor does a horrible product with great service.

If you find yourself struggling between two choices, consider whether those truly are your only choices. Sometimes when we think that we must choose between A and B, we really have another choice.

Business opportunities abound even in a recession

Dan Miller makes a great point in Whack-a-Mole:

When one business lags, another explodes. If your business is suffering, what is the counterpart that is thriving? Can you benefit from that? If appliances aren’t selling, then you can be sure appliance repair is up. If new car sales are in the tank, used cars are thriving.

Small business owners are certainly feeling the pinch of the recession. Consumers are holding on to their money more tightly; unemployment remains high. Those that are buying expect better deals.

Even in tough economic times, opportunities abound. They may not be as easy to spot or exploit, but they still exist. The trick is to spot them, and then act. It might mean expanding your product line to include budget products or offering a new service.

Rather than allow a competitor to capture the market when consumer tastes shift, identify what you can do to meet the new market demands. Business success doesn’t come easily, and sometimes it means finding hidden opportunities.

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