Small business profitable marketing has to be one of the most complex and confusing subjects for SME business owners.
This blog post will explain what profitable marketing is all about and how you can increase the profits in your business from reading about simple strategies and a mindset for marketing success.
Unfortunately you could read a dozen books on marketing and still know very little about the subject (although if you read a few of our free business books you’ll learn some GREAT insights very quickly) so this post will start easy and then get you thinking about the subject and the relationship to it and your business’s success.
Profitable marketing is simply the process of optimising the delivery of products and services to market.
Optimising is about constant improvement, which brings up some of the greatest challenge with marketing.
First of all business owners’ relationship to marketing needs serious improvement… speaking humbly from working with countless hundreds of SME clients over 14+ years.
The typical business owner has a lot of ‘limiting beliefs’ on the subject, so before we go any further we need to do a ‘check up, from the neck up’ so your thinking leads to success!
Which of these thoughts about marketing have you had more than once? …
1. “It’s a necessary evil”
2. “It doesn’t really work”
3. “It’s not hard to do”
4. “I can do it myself”
5. “I know someone who can do it cheaply”
6. “You can never tell what works and what doesn’t”
7. “I don’t like spending money on it”
8. “It’s not something I need to do with my business”
9. “I’ll give it a go myself”
10. “No one can market my business better than me”
Have many of these thoughts or sayings have you heard yourself expressing?
What if I told you ALL 10 of these are all complete myths and misconceptions!
You know the REAL trouble with marketing?
Anyone can do it, so unfortunately anyone does, and starts with a course or two to claim themselves as an “expert”!
My experience over the years has been quite incredible on this subject because I’ve been fortunate to listen, meet and learn from some of the top marketers in Australia and the world. People like Jay Abraham, Chris Newton, Brad Sugars, Siimon Reynolds, Joe Sugarman, Ted Nicholas, John Caples, David Olgilvy and dozens more.
Virtually every successful business owner needs to become fantastic at marketing, yet the average SME doesn’t usually want to spend a cent on learning about it. They outsource it and get it done as cheaply as possible (not with the most expensive and best marketer they can find) and wonder why they still consider it a necessary evil or expense when it doesn’t work!
Marketing IS the BEST investment you will ever make! Second to NONE!
Why would you outsource the one thing that can make you the most money and PROFIT?
It comes down to limiting beliefs and busyness habits.
Business owners are too busy to make money!
They can’t slow down long enough to think, let alone learn, it’s their favourite affirmation “I’m really busy” and they keep telling themselves that.
And what you focus on (and repeat to yourself) is what you create or recreate.
But let’s get back to marketing.
There Are Really Only 5 Types of Marketing…
1. Zero Cost Marketing
2. Leveraged Marketing
3. Cost of Sale Marketing
4. Scalable Marketing
5. Expense Based Marketing
The first 4 are far more profitable marketing strategies. Watch this video to learn more about each one…
Zero Cost Marketing: means it costs you nothing to obtain customers. You wouldn’t believe how easy this is or how many hundreds of strategies there are under this category. Every business can do this, but almost no one does. Business owners believe, “You have to spend money to make money” – what a load of nonsense!
Examples of these strategies are: asking for referrals, strategic alliances (for lead generation) and any strategy to increase conversion rates or the average dollar sale.
Unfortunately a common strategy for some business owners to win new customers is…
Hope obviously doesn’t work as a marketing strategy or for any other need for a solution.
A great example and one that has achieved AWESOME results for hundreds of clients is to focus strategies on improving the conversion rates in a business.
There are so many simple ways to increase conversion rates in a business its almost ridiculous how easy it is. Massive gains in profits for clients over 18 years achieved in just weeks or months are the evidence of how relative this is to all businesses, retail, manufacturing, wholesale and service businesses included.
Our current record is increasing turnover from $600,000/month to $1,000,000 in just 1 month.
The owner was warned how much the training would increase their sales prior to it.
Yes, this was achieved from a one day sales training course!
If you aren’t measuring your conversion rate, I guarantee you aren’t focused on improving it with strategies!
So the first way to do some Zero Cost Marketing for your business is to measure it, because it always goes up when you focus on the number and wonder why its lower than you thought (it always is).
You can seriously gear up Zero Cost Marketing with some strategies – if you know how. Just imagine winning stacks of new customers – all for free? It sounds good doesn’t it, so Zero Cost Marketing has to be the best category.
Learning selling skills is a great example of increasing conversion rates as a Zero Cost Marketing strategy. It’s not exactly Zero in cost though as you need to be trained in the uncommon art of selling by a very experienced professional with brilliant testimonials of outcomes. But it’s something you pay for once and benefit for many months later, so it’s a form of Leveraged Marketing.
Leveraged Marketing: is where you spend money once but get an ongoing residual result where you keep winning more customers, but for no extra cost. Signage is a good example of this. There are lots more awesome strategies for this too, like strategic alliances but signage is a great, simple example.
Cost of Sale Marketing: is where you spend money, but only if when make money back (similar to what appears on a Profit & Loss Statement as a ‘Cost of Sale’).
This has been a very popular one with clients because it costs you nothing unless you make money. Often what you spend is 2% to 10% of what the average customer spends, so you pay a little to make a lot.
Imagine if the banks said, “We will give you $110 for every $100 you give us, a week later”.
What would you do – give them $100?
I would hope you would give them $1,000 or $10,000+ because you make a profit return on everything you spend! The more you spend the more profit you generate.
This is how you need to ALWAYS think with marketing. Invest some money and get more back.
Let’s say you spent $5,000 on testing the same strategy multiple times and made no money back whatsoever, but then with the next $500 spent on the same strategy using a slightly different design you made $10,000. And let’s say you could keep using the same strategy year after year to keep making $10,000 from $500, would that have been worth spending the $5,000 in the initially, even though it supposedly cost you a lot and made you nothing?
This is how entrepreneurs and great marketers think. Marketing is always an investment, not an expense. It’s a subject to study and learn, much like any form of investment you want to create wealth from. When you find something that works, that’s the beginning on your success, not the end. You then need to keep refining and testing changes to optimise it.
There are many strategies in the category of Cost of Sale Marketing.
One of the Best Strategies is Almost the Least Used
An example is a Proactive Referral System whereby you incentivise previous customers to refer people to your business by offering them a gift to do so. Virtually every business can do this and it has worked with spectacular success for so many clients of Business Building Mentors over 14 years.
Scalable Marketing: is where you find a strategy that works and is very scalable in that it can be seriously ramped up. This is fantastic when you fully appreciate what it means.
A scalable strategy is one that works at one level to create great profits, but then you can easily and effortlessly leverage the quantity of it so that you can do more and more, 5, 10 or 100 fold.
Most strategies are scalable and include; telemarketing, letterbox flyers, Google Adwords, direct mail letters, TV advertising, local newspaper ads and more.
There are few limitations to huge increases in marketing with these strategies which is why they are called Scalable ones. This type of marketing can combine with the other categories so you can have scalable zero cost ones, leveraged one etc.
Your aim should be to find these types of strategies. Reflecting on the saying, “When you’re on a good thing, flog it to death” is a great way of thinking about marketing!
Expense Based Marketing: is the most boring of the lot!
This type of marketing is typically what every business owner does and focuses on. It’s the most common type of marketing as well.
This type of marketing is where you spend money and then ‘hope’ you get some back.
This type is very different to Zero Cost Marketing and Cost of Sale Marketing as you are gambling with your money with this type of strategy.
It should be your last choice of marketing types, after you’ve tried the 3 or 4 others.
This type of marketing includes newspaper ads, online ads (like Google Adwords), flyers, direct mail, magazines, inserts, billboards and sponsorship of events.
There are possibly hundreds of these strategies, which can all work brilliantly, but most business owners know of only a handful they could try for their business. This lack of awareness of hundreds of marketing strategy options severely hinders them.
Make a list of strategies you are aware of for your business and count them. Now how many are just advertising? What other strategies can you think of that have nothing to with advertising, like conversion rate strategies, average $ sale strategies, retention and transaction increasing strategies? If you can’t come up with at least 100, you are sure to be missing out on some great strategies that cost you a FORTUNE in lost opportunities and profit.
This brings us to our last subject relating to marketing. It brings with it a question that is an excellent one to stimulate thinking. As the attendees of the Academy of Business Mastery learn all too well, a few good quality questions asked of one self, or of your team, can literally transform the whole business by freeing up your time and finding great strategies to increase your profits.
So here’s the question to ask…
Why doesn’t every person in your local 50km or so radius (or where your business operates), buy from your business?
1. They don’t know your business exists (why not?)
2. They buy from a competitor and not you (why?)
3. They make contact with your business but buy elsewhere (what is your C/R? why?)
4. They have preconceived ideas about your business, which stops them buying (what?)
5. They used to buy but don’t any more (why, how did you repel them?)
6. They do buy now, but not always or irregularly (what can you do about this?)
7. They thought they didn’t need your business’s products/services (and so?)
8. They have no need for your products/services
Now, out of all these questions, consider all the possible answers. What can you do about each one strategy wise? Each point almost certainly needs these questions asked about it: ‘why’, ‘what’ (can you do about it – what strategy), ‘how’ (can you change it) ‘when’ (will you action the strategy) and ‘who’ (can assist me professionally to really create a BIG impact by creating a professional strategy)?
This is a very simple yet very powerful exercise. Talk it over with your team and spend a day, or week on it, then expand that into a month.
Marketing (including mastery of selling) needs to become the most important focus of your business. You probably spent 4 to 10 years learning about production (doing the work once you win it), but almost no time (or money) professionally being trained to on effective marketing. As a result you are probably struggling with low profit margins and low or inconsistent customer numbers.
Think about this… if all of a sudden you had way too many customers to handle, would you put your prices up?
Wouldn’t that create more profit and mean you could afford to pay someone to free up your time?
Low profit margins that hurt cash levels in the bank is the number one reason why business owners work every hour their business trades in the year. So if you had surplus profit, you could pay extra staff to free up your time. Then you would have business freedom! It really does hinge on your marketing (including selling) level of expertise to get too many customers.
Not all business owners need to be masters of marketing, but they especially do if they want to make SERIOUSLY big profits due to BIG net profit margins (i.e. 20%+).
Learning marketing comes from investing in education, in books, webinars, courses and by using experts who have proven results from dozens of SME clients (not corporate ones). SME marketing is completely different to corporate styles of marketing so don’t think you’ve got an “expert” if someone knows corporate marketing, you might waste $10,000+ before you find out it doesn’t work at the small end of town.
Our digital online marketing course – The Marketing Fast Track is the arguably one of the most practical you will ever find. It’s a stand alone course, but also the first step on the Academy of Business Mastery that focuses strongly on “internal marketing”. Internal marketing is preparing your business to be extremely attractive in the market place to attract, service with excellence and also retain A-Class customers, who refer more customers to your business.
The Academy business course has ‘5 Steps’ to take that are all focused on “internal marketing” before external marketing and then a BIG emphasis on marketing with powerful and unique strategies to use, after the ‘5 Steps’.
Each of the ‘5 Steps’ liberates profit at zero cost, hence why they are needed first. Plus they prepares the business for exponential growth (like a client whose business added $8.5 Million in sales in one financial year).
If you’d like to sample our practical marketing strategies to begin with then check out our free digital marketing course online, which contains 3 high quality content videos.
And if you haven’t checked out our Academy of Business Mastery, you’re missing out on the most powerful training for small businesses, arguably in the world. Whatever your goals and dreams you can reach them, and go beyond them all with this course.