5 Ways to Market Your Small Business on a Shoe String Budget
Mark Hale ‐ February 13, 2015
I am sure that you are aware that you need to promote your business. You may also feel like your advertising should generate more results than it has been. For most businesses, money is a definite consideration in marketing and advertising, as well as, the time it takes to do it and the know-how also play a roll in the decision to promote or not to promote.
Promoting your business does not need to cost a lot of money. In its simplest form, promotion is the act of making something known. The more you promote yourself, the better known you will become and the more business you will create for yourself.
The truth is, there is no magical advertising medium where you can spend a little money and get a large return. All advertising mediums you have at your disposal will work to a greater or lesser degree, provided that you know what to expect. Promotion can be as broad as television, radio or billboard ads or it can be as targeted as a direct mail campaign or as simple as picking up the phone and calling a customer.
Here are five high-impact approaches that do not cost a bundle and will work for virtually every business:
- Pick up the phone and call your customers. Get on the phone, call them and see how they are doing.
A tip to get more out of your calling efforts is to invest in note cards or thank you notes. The successful formula is to call your customer and then send a note card immediately after the call. Include in the note card a small 3 x 5 insert card with some sort of special and BAM, you give them a reason to do business with you again. It is a one-two punch that can be very effective. It will cost you very little money and only your time to make the call. On a larger scale, we can even help you out by direct mailing handwritten note cards via bulk mail in a targeted direct mail campaign for your business. Note card mailings are very effective for most businesses.
Part two of talking to your customers is while you have them on the phone ask them to participate in a survey. Surveying your customers accomplishes two things: 1) it helps you uncover new opportunities, and 2) uncovers buttons you can use to make your marketing to new prospects more effective. You can often spot trends and opportunities after as few as 25 to 50 surveys.
The simplest survey questions revolve around the following:
- What problems or challenges were you facing when you considered our services?
- How did our products or services help you solve the problems or challenges you were facing?
- What did you value most about the work we did for you?
- What made you decide to use our company?
The important message here is to use the what, why and how types of questions to find out why people buy your products. You can use the information you discover from your current customers to market to new prospects. It sounds very simple and I can hear you now, as you are rolling your eyes, “I know why people buy from us.” Maybe you do and maybe you will find out something new. One company that recently did this doubled their business in one year because the owners learned what people wanted and how their company’s solution made a difference. From this information they were able to find the best way to present their services to new prospects, and also how to best price their services.
- Ask for referrals. Asking for referrals is one of the most neglected activities for 95% of businesses. If you are working on a shoe string budget and are not asking for referrals from everyone you work with, you are missing and opportunity to increase your sales by 25% – 30% right now! Most people know at least 200 people. Do the math: If you know 200 people and they each know 200 people, that’s 40,000 potential contacts just by asking for referrals! Invest the time and energy developing relationships with the people you already know—customers, clients, colleagues, people you meet through professional networking organizations, friends and even family. Referral cards are also a great tool you can use to get more referrals.
- Use direct mail marketing. Direct mail marketing for small businesses is an effective, low cost means of targeting exactly the ideal customer for your business. Direct mail starts with a good mailing list (we can definitely help you to acquire a targeted mailing list). For some businesses, you may not even need a mailing list and in this case we can help you to get the postage rate down to .16 – .19 cents per piece. Postcards are the least expensive way to use direct mail, but depending on your business and the type of prospect you are trying to reach, a lead letter or note card mailer may work better.
Example, mailing to a doctors office or a big company a lead letter or note card mailer would work best because a postcard would get screened out. On the other hand, for a consumer mailer a postcard cannot be beat for cost and effectiveness.
- Nurture your leads. Sometimes people take more time to make a decision than you want them to. If you have brochures and other sales support materials you can send those to your prospects to follow up and help them with their decision, then you can nurture them along in their decision process. These materials are usually not very expensive and we can help you by designing them so they look professional. Sure, you can create them yourself in Publisher and print them on your ink jet printer to save money if you have to. But at some point you will need to invest a little money and have your marketing materials professionally designed and printed.
How your marketing materials look is a direct reflection on your business. Do they make you look professional or do they make you look like a sketchy fly-by-night operation?
- Know what a new customer is worth to your business. I am amazed at the fact that 65% of business owners have not sat down and done the math as to what a new customer is really worth to their business.
It is important because how can you make decisions that involves spending money to promote your business if you do not know what a new customer is worth to your business? You can’t. Everything will seem too expensive for the return. You will tend to confuse response with results and eventually take a loss on advertising and withdraw from it all together. When this happens, it is the beginning of the end for a business.
Here is an example of what I mean about confusing response with results: I had a client who did a mailer and got 5 new customer from it. He felt the mailer was a failure. He was expecting 100 responses, only got 10 calls, 5 of which he sold.
His average customer was worth $1500 per year to him and they usually stayed with him for at least 3 years. So an average new customer was really worth $4500 to his business ($1500 x 3 years). He minimally created $7500 ($1500 x 5 new customer’s one year purchases) and potentially generated $22,500, ($7500 x 3 years) in sales off a campaign that cost him $1800 to print and mail. That was a 12x return on his investment of $1800.
If he had a referral program in place, he could turn those 5 new customers into $50,000 to $75,000 in sales very easily by getting 3 referrals from each of the 5 new people he got from the mailer. You will find that the more targeted your message and mailing is, the fewer number of total responses you will receive compared to the actual sales you will get. Your closing ratio will look very high when your marketing is targeted. This is because your message is hitting people who need and want what you are selling. There is a big difference between response and results. You want results not just response.
Here is a link to an easy-to-use calculator that will help you determine the worth of a new customer to your business. You might be surprised as to what a new customer is actually worth to your business.
Key to Your Marketing Success
Make yourself known by promoting as much as you can in an ever-growing and widening circle. Promote, then educate your prospects and people will buy. People do not like to be sold. They want to be enlightened. They want information on how and what you will do to help them. This is where a well-designed brochure, flyer and/or booklet come into play. These are tools you can use to educate and enlighten your prospects. The intention should be to build relationships. These relationships will develop over time as you create credibility and trust. Start from the perspective of giving more than what you ask for.
When it comes to promotion, everything in your business should tie together to create a positive impression of your business. I know it may seem like a lot, but take it one step at a time and eventually it will all come together.
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