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What exactly is Database Marketing?
Small businesses don’t always have a Marketing Plan. And when someone suggests Database Marketing, they often ask:”What the heck is Database Marketing?” or, if they know what it is, “Isn’t Database Marketing only for the big boys?”
The answer is No. You do not need an expensive system to set up a Database. You can use a simple spreadsheet to record the essential information about your customers.
These are the details your system should record:
Recency: date of last purchase
Frequency: how many purchases made
Money: total spend with you so far
Average order: Money divided by Frequency
Trend: are the Frequency and Average rising or falling?
Your marketing should focus on Recency, Frequency and Money – the RFM factors, as they are called in Direct Marketing.
Those who bought from you recently, and often, are the ones most likely to buy from you again, because they have accepted you as a preferred supplier, and do not need much reminding of the benefits of doing business with you.
And those who buy frequently could quite readily be persuaded to shorten the gap between purchases or to order something new between their regular purchases.
The total money spent with you will also determine how important they are to your business, and how profitable.
Obviously, Recency, Frequency and Money will have different values in different businesses.
For example, the gaps for buying computers will usually be much greater than for consumables like stationery. You should monitor all gaps and learn what is normal for each type of product, not only among your own customers, but in the industry.
It adds important information to your Database – information that can guide your Marketing decisions.
The other factor to consider is creativity – copywriting and design. Start with an email to phillip@speakingandpresentationskills.com“>phillip@speakingandpresentationskills.com or call 0845 165 9240 . The initial consultation is free.
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How to avoid some common mistakes in email
As you know, these days much of our business correspondence is conducted by email rather than the conventional ‘snail mail’. Unhappily, certain conventions have been lost or overlooked in the process, and can get in the way of doing business, especially when there are cultural differences involved.
TYPICAL PROBLEMS:
• Sloppy layout
• Poor spelling / typing errors
• Incorrect grammar or punctuation
• Wrong forms of address
• Lack of formal opening and closing
• Missing reply information
• Wrong tone for the person being addressed
• One country’s conventions not acceptable in another country
• Risk of virus infection
• Divulging others’ email addresses
• MannersSloppy layout: Get professional help to establish templates. If possible, use a header, to make your email look like a regular letterheading. Otherwise how will it look different from the many spam messages?
Spelling/Typing:Â Always use the spellchecker, but also use an English dictionary (spellcheckers are American). Be especially careful to avoid writing “their” when you mean “they’re” and “your” for “you’re”.
Grammar/Punctuation:Â If in doubt, ask someone who knows. Phrases such as “between you and I” will diminish you in the eyes of some clients, and so will misplaced apostrophes. Never use one for a plural. “I received your letters” is correct. “I received your letter’s” is wrong.
Language:Â The phrases and vocabulary you use will pigeon-hole you, perhaps at the wrong level. For example, “some cool stuff” and “Cheers” are not ideal for business letters.
Forms of address:Â When approaching a business contact for the first time, it is unwise to write “Hello there” or “Hi” or even “Dear John”.
Opening/Closing:Â Some emails leave out the salutation altogether. Others omit the name and title of the sender. If you are running back and forth with reply after reply on the same topic, and to someone you know well, it’s all right to omit the salutation.
Tone: Err on the side of caution. Don’t be familiar with a client or someone senior, and never write what you may regret the next day.
Conventions:Â See Opening/Closing. In some countries you are expected always to use a salutation.
Virus & Junk:Â In business circles, it is considered very bad manners to send a virus, so install and regularly update your virus checking software. It is also bad form to pass on chain letters, however well-meaning they may be. And never pass on email advertisements.
Divulging addresses:Â If you send an email to a whole group of unconnected people, use the BCC (blind carbon copy) to avoid exposing others’ email addresses without permission.
Manners:Â Capital Letters in emails are regarded as SHOUTING. Use *stars* for emphasis.
For a confidential course in Business Writing, email phillip@speakingandpresentationskills.com.
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The language of lies
In marketing by mail and email, there is an unfortunate tendency to use language to deceive, confusing manipulation with persuasion. Those who do so use weasel words (terms that imply or suggest more than the reality), and even lie outright. My email inbox regularly receives examples of verbal deceit.
There is one chap who sends me emails with things like “Facebook message” in the subject line. The email itself has nothing to do with Facebook. It’s just a crude device to get me to open the email.
To my mind it falls in the same ditch as the person who says, “Sex! Now that I have your attention …” Astonishingly, there are still some folks who use that cringingly awful “Hook”, either in writing or in speech.
I promised myself that the next time I heard a speaker open with that I would rise and leave the room in a marked manner. And I shall.
Another devious device is to offer something free, and then renege on it. Here’s one I received last week:
Im (sic) giving this away Totally FREE!
But when you click on the link, this is what you get:
==============================
Regular Price $197
Today only $37/mon
ADD TO CARTTODAY’S PAYMENT: $44.40
Includes the first month of service===============================
It goes from FREE to $37 PER MONTH! and on to $44.40 (per month) without missing a beat.Let me now turn to weasel words. They are terms we use to imply something more than the reality. The intention is to deceive.
One of the most common examples these days is “You have been approved”. It implies a selection that never took place, other than inclusion from the database. It even suggests that you have applied in the first place.
A close relation is the long-standing “Three Stage” copy approach favoured by Reader’s Digest, which states, “You have come through two stages of selection and are now in the final of the Prize Draw.”
The first two stages actually consist of selecting names from the database (known to be interested in the product being offered) and the allocation (automatically by computer) of six numbers in the Draw. There’s nothing illegal or even immoral about this approach, but I think you can see how the wording implies more than what actually takes place.
Another favourite involves a sealed envelope that you have to tear open to see if you are a lucky winner. The weasel words in this case will be, “Find a Lucky Six for a chance to Scoop the Jackpot”.
Once again the implication is that there is an element of chance, whereas every sealed envelope contains a six. The key word is “Find”. For a genuine element of chance there would be the word “If”, as in “See if you have a lucky six.”
A poor copywriter will either lie or come close to deceit. The skilled copywriter will raise hopes without being untruthful. Direct Marketing is salesmanship in print, so it must use the stratagems of a professional sales person, and (usually) follow the AIDA sequence (Attention, Interest, Desire, Action) of persuasion.
Deceit is not the best basis for starting a customer relationship, so my advice is this: Always tell the truth, but make the truth fascinating!
Phillip -
How to influence response to your mailings
The level of response to direct mail is one of the most shocking facts in advertising. A few years ago, the Direct Marketing Association surveyed 1,122 industry-specific campaigns and came up with an average response rate of 2.61 per cent. That’s a failure rate of over 97 per cent!
The figures for 2010 are not much better, on either side of the Atlantic. The DMA in the US reported 3.42 per cent response from a house list and 1.38 per cent from a prospect list. Email to a house list got a 19.47 per cent open rate, 6.64 click through rate, and a conversion of just 1.73 per cent.
SME’s report a typical direct mail response rate of less than one per cent. Forgive me for throwing all these figures at you, but I think you’ll agree that such results amount to a waste of time and money.
I once approached a blue chip company that was mailing its members to offer membership renewal by continuous credit card authority (direct debit by credit card). Their large ad agency had just achieved a 12% response, and everyone was celebrating.
I offered an alternative approach, and got a 32% YES response.
The point is that it is not written in the stars that you should have a single-digit response rate. There are things you can do to deliver a better return on the money you spend. Here are a few:
- Provide an incentive to reply, even if it’s to say No thanks. The more replies you get, in total, the higher will be the Yes response.
- Plan a series of mailings and other follow-ups, not just a single shot. Some people need seven contacts before they say Yes.
- Segment your list and make a specific offer/approach to each segment, rather than the same message to all.
One more piece of advice. Use a professional copywriter with experience of direct mail. Unless you are one yourself, do not write your own mailings. At the same time, do not expect a copywriter to wave a magic wand. Give him or her a chance to develop the right relationship with your prospects and customers.
It will be money well spent.
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Self-serving advertising can cost you dearly
The advertising industry’s magazine, Campaign, is running a series on the history of advertising in various objects. No. 18 is Strand cigarettes. By a sheer coincidence I was talking about it (and the ad campaign) only yesterday.
Written by a brilliant copywriter, John May of S H Benson, the commercial featured a Frank Sinatra lookalike, and rapidly became much talked about.
Campaign reveals that Strand was bought by only 0.3% of male smokers and 0.7% of female smokers. A resounding flop!
However, Campaign explains the failure like this: “… great advertising can’t sell a poor product. Strand was just a lousy smoke.â€
Spot the fallacy. If hardly anyone bought the product, how did anyone know it was a lousy smoke? Campaign’s explanation is clearly an attempt to exonerate advertising and shift the blame away from the ad’s creator.
The real explanation may be more obvious: the commercial’s plain purpose was to flaunt its creativity, both in the Big Idea and in its clever execution. A common failing in advertising. It did not relate to the motivation of smokers, nor did it reflect their preferred lifestyle.
Did the agency do any research or testing? Or was it just another example of self-serving advertising? The theme music was great and did well in the charts. The photography was moody and very well observed. And the actor accurately portrayed a singleton in need of care.
Just because the individual elements were well done, it was (wrongly) assumed that the ad would sell the product. It’s well known in Selling that when people notice and applaud your performance, you have failed.
Besides, would you have wanted to pull out a packet of fags that proclaimed you a lonely sad sack?  ‘Nuff said.
PKP
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Cross culture is on your doorstep
Talk about cross culture or cultural diversity and people think it’s ‘over there’. In reality, it’s very much ‘over here’. What’s more, it’s one of today’s hot topics in business – one that concerns you if you are a senior manager or business owner.
Let me start by defining ‘culture’. In simple terms it means, ‘the way we do things here’. That could apply to the norms in a region, in a country, even in a company. Just think about the way different banks do business. They are all in the same line of business, yet each bank has its own style, values, and practices, and each delivers a very different experience to customers.
Two examples of banking practices: one in Bogotá, Colombia, the other in South London. The first concerned Tom Bennett, a senior accountant with a major New York accounting firm, who travelled to Bogotá on business. He popped into a branch of the country’s largest bank to cash a cheque.
When he eventually got past the gaggle of people in front of a teller, he handed in his cheque and waited for his money. As you do. While he was there, several people elbowed their way to the same window and handed in their cheques, treating Tom as though he was in the way.
What he didn’t know was that the custom was to hand in your cheque and step back to allow others to do the same. You would be called when your money was ready. If Tom had known that he would have avoided the unpleasantness he encountered.
The second incident occurred in a South London branch of a leading bank, a few years ago. I was standing in a queue when an Oriental trader, perhaps from a restaurant, came in and went up to the Enquiries window. He asked to see the Manager and was asked to take a seat in the open plan area. Eventually a young man, obviously not the Bank Manager, came out and sat with the trader, within sight and earshot of all the other customers in the bank.
The Oriental gentleman was very uncomfortable and mumbled a question that was probably not the one he had wanted to raise, and left very quickly. He had not been offered any privacy for his conversation and I reckon he felt both embarrassed and humiliated by the expectation that he would discuss his business requirements in public.
Both incidents arose out of cultural misunderstandings.
In your business, you may have customers and staff with cultural expectations that differ from your own. That puts ‘cross culture’ firmly on your doorstep. If you’d like help with managing those differences, email me at phillip@speakingandpresentationskills.com“>phillip@speakingandpresentationskills.com.
Phillip
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In these troubled times
When times are tough, as they clearly are at the moment, it is interesting to see how businesses behave.
On my bookshelf I have a couple of books that were written some time ago, but whose titles would fit very well with the prevailing mood. One is called The Best Damn Sales Book Ever and the other is titled Buy This Book!
I’ll return to them in a moment, but let me contrast them with a couple of printers I’ve recently dealt with. The simpler one first. I received a promotional email last week from a printer I had never used before. I immediately replied with a request for a couple of printing quotes. It was ignored.
Meanwhile I received three promotional emails from someone of the same name, inviting me to a seminar on property investment. While I applaud diversity, is this printer wise to take his eye off his core business?
Now the reason I was asking for a quote from a new source of printing is that my previous printer mis-printed my business cards, and let me down when I pointed out the error. His integrity is worth less than the cost of re-printing my cards. (If you want to know who he is, contact me and I’ll tell you.)
Back to the books. Their titles proclaim the authors to be bold, brash and bursting with self confidence. Warren Greshes’ Sales Book may not actually be the best of its kind, but it is certainly very good, and contains a lot of useful guidance for those who are struggling with slimmed-down sales pipelines.
The other book is by Raj Marwah who was born and raised in India, but now lives in Australia. His book on advertising owes much to David Ogilvy’s book, Ogilvy on Advertising, but he has chutzpah in spades. And that’s a quality that will separate the best from the rest.
Wondering if you should have another go at a sales letter? Or perhaps a new business presentation? Let me make it easy for you. Write to me personally at phillip@pkpcommunicators.com.
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Have you considered Database Marketing?
Small businesses don’t always have a Marketing Plan. And when someone suggests Database Marketing, here’s what they often ask: “Isn’t Database Marketing only for the big boys?â€
The answer is No. You do not need an expensive system to set up a Database. You can use a simple spreadsheet to record the essential information about your customers.
These are the details your system should record:
Recency: date of last purchase
Frequency: how many purchases made
Money: total spend with you so far
Average order: Money divided by Frequency
Trend: are the Frequency and Average rising or falling?
Your marketing should focus on Recency, Frequency and Money – the RFM factors, as they are called in Direct Marketing.
Those who bought from you recently, and often, are the ones most likely to buy from you again, because they have accepted you as a preferred supplier, and do not need much reminding of the benefits of doing business with you.
And those who buy frequently could quite readily be persuaded to shorten the gap between purchases or to order something new between their regular purchases.
The total money spent with you will also determine how important they are to your business, and how profitable.
Obviously, Recency, Frequency and Money will have different values in different businesses.
For example, the gaps for buying computers will usually be much greater than for consumables like stationery. You should monitor all gaps and learn what is normal for each type of product, not only among your own customers, but in the industry.
It adds important information to your Database – information that can guide your Marketing decisions.
The other factor to consider is creativity – copywriting and design. Start with an email to phillip@speakingandpresentationskills.com or call 0845 165 9240.
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Managing rejection in sales
A lot of people consider selling to be a confrontational conversion, lightly smeared with honey to make it seem agreeable. There are two reasons for that: first, the sales person wants to win, and second, the prospect wants to retain both his money and his pride.
Now, of course this does not happen in every sale, but it can be considered a typical model. Elements of the confrontation could quite easily enter any sale.
The second reason is that the sales person is scared of rejection. As you know, fear of loss or pain is a much more powerful motivator than the prospect of gain. Rejection brings loss of face – a concept not restricted to Orientals.
To avoid rejection, the sales person needs a protective strategy.
Some adopt a tough attitude, placing themselves in the dominant role, and the prospect in the role of supplicant. This old-fashioned macho approach is doomed to failure in the long run. Even short term gains may quickly be reversed with cancellations at the first opportunity.
Even the prospect wants to save face!
If you are selling, you need to build into your preparation a fall-back position. What is the least you will settle for if you don’t get the sale?
It could be something as simple as an introduction to another prospect, or even another appointment in three months’ time. It could be a referral to someone else. Viewed in the context of a new relationship, an immediate sale is not the only objective.
Work out what you will accept as an alternative to your main objective and you will be able to walk out with your tail up. Selling is hard, and no one can endure repeated rejections without being affected.
So protect yourself. Plan your fall-back position and give yourself another chance to feel good about the encounter.
