Business Growth Masterclass 15 – How to improve your conversion rate

Hello there and welcome to the 15th instalment of my Business Growth Masterclass. The step by step guide to building the business you always wished you could have.

Today, we’re going to look at a few tips and tricks to increase your conversion rates from lead to paying customer or client.

As ever though, before we get our teeth into today’s material, lets just check on actions from the last Business Growth Masterclass:

Did you do your homework?

  • You have implemented two persuasive writing techniques in your marketing materials.
  • You have elaborated on your list of emotional trigger words and phrases that will inspire your target market to take action.

Now that your target prospects are answering your call to action, how can you get them to actually become your customers?

conversions funnel

A big part of your focus to date has been on identifying who your ideal customers are, deciding how to reach them, and how to communicate with them so that they take action and contact you. Converting leads into customers is your next point of focus, and step two of the five-step process. You’ve spent so much time and money enticing the right people to raise their hands and identify themselves that now all you and your staff need to do is convince them to become your customers. Generally, how your potential customers perceive your business and your staff, as well as how much trust you can build and how fast you can build that trust are the two key factors that impact conversion rates. Secondly, the strength of your sales process and scripts as well as the level of risk involved in purchasing your product or service also have a powerful impact on conversion rates. But before we get into ways you can improve your conversion rates, let’s take a look at where conversions stand in your business right now. I’ll also show you how to evaluate whether you have a strong conversion rate or not – it’s not as black and white as you think.

In this Masterclass we will cover:

  • How your conversion rate impacts the bottom line
  • How to measure your conversion rate
  • How to evaluate your conversion rate
  • How trust and qualified lead generation impacts conversion rates
  • Strategies for improving your conversion rate

Your conversion rate is the second factor in the customer equation.

A conversion rate is simply the number of transactions divided by the number of leads during a specific time period. It’s a ratio between the number of people you attracted with your lead generation strategies, and the number of people who purchased from you and became your customers. So if 150 people come through your store in a day, and 50 of them make a purchase, your conversion rate is 33% for that day.

Converting leads – which is essentially the sales process – is likely the core of your daily business efforts. You’ve spent time and money setting up lead generation systems and strategies, so it stands to reason that you should put equal time and energy into converting those leads into loyal customers. I’m going to show you in a few minutes how you can improve your conversion rate with a few simple strategies, but first I want to show you how increasing your conversion rate alone will have a dramatic impact on your bottom line. Using the five-step formula, here is an example of how a 10% and 30% increase in conversions can impact your total profit.

Starting Point 10% Increase 30% Increase
Leads 4,500 4,500 4,500
Conversion Rate 30% 33% (10% increase) 39% (30% increase)
Customers 1350 1485 1755
Transactions 1.3 1.3 1.3
Average Sales Value £140 £140 £140
Revenue £245,700 £270,270 £319,410
Margins 24% 24% 24%
Profit £58,968 £64,864.80 £76,658.40

What is the average conversion rate for your business?

To figure out your conversion rate, choose a specific time period (day, week, month, campaign) and then divide the total number of sales transactions by the number of people who inquired about your product or service (leads) and multiply by 100. This is a percentage value of your conversion rate. For example, 50 transactions / 150 leads x 100 = 33% conversion rate. Now, if I wanted to look at conversions over a specific time period, the rate would vary:

Leads Sales Conversion Rate
Day 150 50 33%
Week 910 286 31%
Month 4050 1196 29%

If you’ve been tracking your leads over the past few weeks, you’ll be in good shape. All you may have to do is look at your lead tracking sheet, and divide into it your total number of sales over specific time periods. You’ll be able to analyse what your conversion rate looks like over the course of ad or direct mail campaigns, as well as over various weeks in the month. If you haven’t started tracking your leads, you’re going to have to start in order to understand what your true conversion rate is. In my experience, many business owners overestimate what this percentage actually is, so I feel this is an important step in the process.

Keep track of the following items in your conversion rate measurement sheet:

  • Start date and end date of the measurement period (by ad campaign, week, or month)
  • Total number of leads (divided by source – telephone, in store, online, etc.)
  • Total number of sales transactions
  • How trust and qualified lead generation impacts conversion rates

If you’re starting to track leads and sales today, by the end of a week you’ll have a reasonable understanding of where your business stands.

How do you evaluate if your conversion rate is “good” or not?

I have clients ask me this all the time, ‘Once you know what your conversion rate is, how can you tell if it’s “good” or “profitable”?’ Unfortunately, the answer isn’t a black and white one. The truth is that conversion rates vary and depend on the product, service and customer base. Different businesses can have dramatically different rates, yet both rates can mean the respective companies are highly successful. For example, a thriving pound store may have a conversion rate of almost 80%, while a profitable furniture store may have a conversion rate of 30%. Other businesses might have rates of anywhere from 4% to 99%. You can put it into perspective if you think about how differently these businesses operate. Pound stores generally have a high volume of foot traffic and offer a wide variety of products. The price point is low, and most people who walk into a pound store buy something. Furniture stores, on the other hand, offer products of a higher value that usually require more thought prior to purchase. The store generally advertises to attract leads that are looking for specific items and features. Lastly, the product requires a much more substantial investment. So, instead of focusing on how close your conversion rate is to 100%, you need to think of conversions as relative to your break-even point – either for a campaign or for regular business operations. To do this, you need more information than the rate itself. You need to know how many leads you need to convert into customers to see a return on investment. You need to know how much money each lead costs you, on average how much they spend, and how much of their spend is actual profit. For example, if you have £4,000 to spend on advertising and you want to see £20,000 in sales, will a 20% conversion rate be enough to do the job? To answer this, you need more information on other measures in your business. You need to know your average pound sale and average customer acquisition cost. In this example, let’s say your average pound sale is £42 and your average customer acquisition cost is £2.50. (You’ll look at customer acquisition costs in the next Masterclass). If you take your £4,000 advertising budget and divide by your £2.50 customer acquisition cost, you’ll expect to generate about 1,600 leads. So 1,600 leads with a 20% conversion rate would equal 320 sales – not bad. Now, take the 320 projected sales times the average pound sale of £75, and you’ll get £24,000 in revenue. That’s a reasonable ROI for a £4,000 investment! But is the 20% conversion rate a ‘good’ one? To answer this, you’ll have to factor in your profit margin to determine the answer. You wanted to achieve £20,000 from your £4,000 advertising investment. Let’s say your average profit margin is 45.3%. So, on each £75 sale, you made £34 profit. So, let’s look at your actual profit after costs:

320 sales x £34 profit per transaction= £10,880 in take home profit.

So, when the rest of your business measures are factored in, you actually only achieved a 272% return on investment, which is about half of what you were targeting. Therefore, in this case, a 20% target conversion rate isn’t necessarily a strong one for your business.

Now, before you dive into any conversion rate boosting strategies, focus on building trust and generating qualified leads – the cornerstones of a profitable conversion rate.

You probably already know that trust is a huge factor in any exchange with a potential customer. When you first learned about sales and the selling process, you learned about building trust and rapport with the people who are giving you their money. So, trust is therefore a big factor in having a healthy (and profitable) conversion rate. Your prospect needs to trust in the value of your offering, as well as the credibility of the business and the knowledge of the people who work there. The issue here, of course, is the length of time it takes to truly establish trust, or credibility. With all your new leads – practically strangers – walking through the door and picking up the phone, you need to establish instant trust and credibility in order to make the most of the time you spend with each prospect. The other important point I want to make is about the role that qualified leads have in your conversion rate. It’s one thing to have hundreds of leads contact you on a daily basis, but if they’re not qualified leads, they’re less likely to buy, and are therefore potentially wasting your time and squashing your conversion rate.

Here are five ways you can boost your conversion rate with little improvements to your business.

satisfied_customers

1. Build instant trust.

Use testimonials. Ask happy customers to write testimonials about their experience at your business. Use their words (or even their whole letters) in your marketing materials, or post them in your place of business. Testimonials boost confidence in what you’re offering and establish trust in the eyes of prospects.

Showcase your good news. Post awards, accolades, media articles and other ‘proof’ of your credibility around your business and on your website.

2. Create an image of quality.

Consider the appearance of your staff. How do you and your staff members dress? Does your appearance communicate the right message to potential clients about your offering? You don’t need to show up in a suit every day, but make sure everyone’s appearance is professional and appropriate for your business.

Improve the perception of your business. This includes the physical state of your place of business, as well as the quality of your marketing materials and the quality of the service customers’ receive when they purchase from you.

Give merchandise displays a boost. Can you make your products look more attractive through the way they’re displayed or arranged? Put complementary products together, and create feature product displays to create variety and interest.

3. Train and develop your staff.

Give staff conversion targets and incentives. Remember that you’re not the only one who can contribute to an increase in conversions. Involve and support your staff in tracking and boosting conversion rates. Give them individual targets, and incentives for meeting them.

Review and improve sales process. Everyone can improve their sales skills, and refine the process they use to close sales. Take an opportunity to watch and give feedback to your staff members, or hold a brainstorming session to discuss what techniques, phrases, objections are most effective when selling your product or service.

Develop and continuously update scripts. If you’re not using scripts, it’s time to start (you’ll see why in an upcoming Masterclass). If you are using scripts, make sure you’re revising and improving them on a regular basis based on what you and your staff experience during the sales process.

Focus on customer education instead of sales. Face it, no one likes to be ‘sold’ to. Focus your sales process on building a relationship with and educating your customer on the benefits and solutions of your offering. The more they learn, the more they’ll believe what you have to say, trusting the business enough to make a purchase.

4. Improve your offering.

customer-service

Increase quality, exclusivity or range. Can you improve the quality of products or services that you offer? Carry a more exclusive product, or extend your range of products? Take a look at your merchandising mix and service menu and identify areas where you can expand or specialise.

Make great offers. Strong offers can also serve as an incentive for a potential customer to complete the sale. Offer great perceived value, or exclusive and time-sensitive products or services, and you’ll see a spike in your conversion rate.

5. Take away purchase risk.

Provide free trials and demonstrations. Allow your customers to test out your product or service for free, with no obligation to purchase. Or, offer free demonstrations so your customer can see the benefit or solution your product or service provides.

Guarantee product or service performance. Take away the purchase risk from your potential customer, and you’ll have a powerful strategy for closing sales and increasing conversions. This is also an immediate trust and credibility booster – you are so confident in your product or service’s results that you’re guaranteeing them.

Work with your staff on a daily or weekly basis to consistently measure and increase conversion rates.

Post a calendar in the staff room or common area, and track your targeted and actual conversion rates on a daily and weekly basis. This will give you and your staff a visual reminder of the company’s goals, as well as an indication of how the team is performing. You don’t work in your business alone, so involve and motivate your team to support you in growing your business. Give them incentives and help them develop their sales skills, and I promise you’ll see an impact on your conversions. The next step is about customer loyalty – how to keep your clients coming back to make new purchases, instead of continuously trying to buy new clients. As always, let me know if you have any questions.

You can  use the contact form below to discuss and get help with the topics covered in this,or Any of the previous Business Growth Masterclasses.

Until next time, good luck!

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Business Growth Masterclass 13: Marketing Materials – Ads

Hello there, and welcome to the 13th instalment of my Business Growth Masterclass. The step by step guide to building the business you always wished you could have.

Today, we’re going to look at the importance of high quality advertisements in your overall marketing mix.

As ever though, before we get our teeth into today’s material, lets just check on actions from the last Business Growth Masterclass:

Checkpoint:

  • You have created a list of words to use in your marketing materials that will target your potential customer’s emotional motivators.
  • You have practiced writing headlines, and are working to strengthen the headlines you have been using.

For many small business owners, advertising is a confusing, expensive marketing strategy that delivers mediocre results.

We’re surrounded by advertising everywhere we look. From TV commercials and Google Adwords to local newspaper and radio spots, everyone is vying for your attention and the money in your wallet.

So, as a small business owner, how do you weed through the big corporate marketing campaigns and your competitors’ ads, flashy design and high budgets, and figure out what you should do for your own business?

In this Masterclass I want to show you how to create clear, cost-effective ads and placement campaigns that get results for your company.

I use a few hand picked templatesfor my coaching clients and I’m going to share some of this material with you today. They’re not going to win any advertising awards, but they don’t need to because they’ve generated hundreds of thousands of pounds for small business owners just like yourself! At the end of the day, do you want an advertising trophy, or thousands of pounds in the bank?

In this Business Growth Masterclass we will cover:

  • Types of advertising
  • Print advertising for lead generation
  • Steps to creating effective (and inexpensive!) print and classified ads
  • Testing and measuring your ads
  • Examples of effective ads

Successful advertisements are those that have been designed with a clear purpose, and for a specific target audience.

Successful ads are successful because they pay for themselves with the sales traffic they generate. They bring in leads, promote products and services, and maintain awareness of your business.

So, like all of the lead generation strategies you’ve been working on, effective advertising is rooted in a strong understanding of your target market and how to motivate them to do what you want them to do.

Successful advertising, no matter what its specific purpose is, always:

  • provides a benefit, meets a need, or solves a problem
  • targets an audience that wants or needs the benefit or solution
  • offers a product that is closely tied to the benefit or solution
  • clearly communicates the message (the benefit or solution) and is easy to understand
  • pays for itself by generating a high volume of sales traffic

Every business should have an overall strategy or purpose for their advertising over time. This will not only allow you to save money by making bulk ad purchases, but will keep you from advertising on an infrequent basis, or in an ad hoc fashion.

Align your advertising with your business growth or positioning goals, and map out a six month or year-long strategy. Do you want to position your business as the expert in the industry? Double your lead generation? Sell a specific product or service? Announce new products or services? Maintain awareness of your company?

Here are some forms of advertising that each have a separate purpose:

Information Advertising is a common form of advertising that features the company in question in a positive light. Be careful not to misuse this form, as no reader is going to be interested in an ad that is too “me”, “me”, “me” focused. Always provide something of interest or benefit to your reader.

Image Advertising is a type of advertising that reinforces your brand name and image. It’s a less aggressive strategy that aims to keep your business at the top of customers’ minds, even if you have no specific message to communicate. It might include running frequent small ads with just your business logo and phone number or email address.

Ads That Sell convince a prospect to make a purchase before they’ve even identified themselves as prospects. These are more rare forms of advertisements, and harder to create. Lead generation ads are a more effective way to generate traffic.

In this Masterclass, we’re going to focus on advertising for lead generation.

Ads that have been created for lead generation have a strong “call to action” and are focused on motivating readers to respond.

You may want prospects to pick up the phone, bring in a coupon, enter their contact information in a contest, call for free information, visit your website or visit your place of business. At that point, they enter the formal sales process and you can work to convert them into loyal repeat customers.

Use the emotional motivators you’ve been focusing on the previous Business Growth Masterclasses to speak to your target audience, and focus on getting your readers to do something that identifies themselves as potential buyers.

1. Design your advertising strategy. Advertise to your target market in the places they go to most often for information.

Using the information you gathered in your market research, determine the publications that your target market accesses most often.

  • Do they read the local newspaper? If so, which section?
  • Is there a community newsletter or neighbourhood publication that would also serve as an effective vehicle for your message?
  • Is there a local listing publication that would serve as an inexpensive way to test and measure your offer?
  • Can you create a YellowPages ad that generates leads?

Once you have determined the publication (or publications) that you wish to target, make contact with the sales representative at each. This person is a great resource for you to use to your advantage – ask questions about size, specs, deadlines, proofs, changes and other expectations. Newspapers often use their own systems for layout, and have their own requirements for file preparation.

This person will also have demographic information on the publication’s readership, so gain access to that data and use it to inform your campaign.

When you are establishing a relationship with the publication, make sure to spread your advertising budget out to maximise your investment. Publications will often give you discounted rates when you buy in bulk, or commit to a certain budget over the year. Keep in mind that you will need to test and measure which ads are effective, and which aren’t, so try to structure your contract in a way that allows for flexibility.

While you are looking for a good advertising rate, remember that advertising is an investment that you make into the growth of your business. That money is used to ‘buy’ customers, whose purchases become your return on investment.

Ad placement is also an important consideration, but you will have varying degrees of influence over the final placement. Always request placement that is well forward and in the top right-hand corner, preferably in the section of the paper that best relates to your industry.

Advertise frequently – or at least regularly – to see the highest return on investment. There are a number of reasons for this:

  1. People need to be reminded constantly of your business (even big household names like CocaCola advertise regularly)
  2. There are always new customers to market to
  3. The people who are actually looking to purchase your offering are a percentage of your target market that rotates regularly
  4. People need to see your advertisement regularly to build trust and belief in credibility

Make a plan for regular advertising that suits your budget. You may want to alternate between large and small ads, or between display and classified ads.

2. Write copy for your ad that speaks to the emotional motivators of your target audience.

Use the writing and persuasion skills you’ve been learning in the past two Masterclasses, and apply the same principles to writing your ad copy. The next Masterclass will take an in-depth look at copywriting; so more help is on the way!

Like you learned in the headlines Masterclass, the most important part of your copy is your headline. You need to start with a headline that catches their attention with emotional triggers, and then gives them a reason to keep reading and care about what you have to say.

In advertisements it’s especially useful to follow your headline with a subheadline that is equally interesting and engaging. The remainder of your copy should focus on communicating the benefits or solutions that your product will provide, and deliver on any promises you made in your headline. Tell your prospects why they should take action, and what they’ll get when they do. Use the emotional trigger words to hit their ‘hot buttons’ and keep them reading.

A final tip in writing ads for lead generation is about weeding out unqualified leads. Make sure you include enough information in your ad to deter unlikely customers from making contact with you. For example, be up front about price and you’ll avoid dozens of phone calls from people who can’t afford to purchase your offering.

3. Ask your customers to take action.

Since the purpose of your ad is to generate qualified leads, your call to action has to be prominently featured so your readers know what to do and how to do it.

  1. Ensure the way you want them to contact you is a larger font size than the rest of your contact details, or the only contact method.
  2. Tell them how to receive what you’ve promised – free information, a special offer, preferred status. For example – Call 0845 6669997 right now and ask for Ted; Visit www.newco.com and sign-up to start receiving your bonus guide; or come to the store and ask for your membership card.
  3. Link your call to action to copy that mentions customer benefits and rewards. Phrases like, Call now and start receiving: lists of benefits are particularly strong motivators.

4. Layout your ad using these guidelines.

Remember that it is the strength of your message and the clarity of the layout that will determine how effective your ad will be. Resist the urge to get really creative and stick to a clean and simple design.

Layout should be kept simple and allow the message to come through clearly, not the formatting. Keep all type horizontal, and avoid the urge to get too creative.

Headlines are absolutely essential to successful ads. Create a powerful headline that draws in readers, and make it stand out from the rest of the ad.

White Space gives your reader’s eyes a place to rest and will keep their attention on your ad longer. If you cram too much copy or too many images into a small space, your readers will move on.

Type needs to be easy to read, but also stand out from neighbouring newspaper copy. Stick to a maximum of two types of font, and avoid font sizes below 9pt. ALL CAPS and reversed type (white on black) should also be avoided.

Images need to be professionally taken in order to be reproduced in newspapers. Take care that black and white images are not too dark, or too light, and choose photos the will clearly communicate your message.

Color can boost the response rate to your ad by almost 40% over a black and white one, so use it if you can fit it into your budget.

5. Make sure to be aware of and set yourself apart from the competition

Pay attention to what your competitors are doing so you are aware of what they are doing well, doing poorly, or not doing at all. With this awareness, you can make choices to set yourself apart, or improve on your own strategies.

Without copying their strategies (you don’t want to be a “me too” business), look at their messages, layout, placement choices and offers. What can you do to give your offer or your ad an edge? Is there something they haven’t thought of?

You may want to get into the habit of clipping their ads out of the newspaper, and making observations about the messaging or design. Use this information to improve your ads and distinguish your business, but stay focused on your own purpose and messages.

6. Test and measure each and every ad, every time you run it.

Like I said above, successful advertising is advertising that pays for itself.

It is helpful to think of advertising as an investment, rather than an expense. You are investing money in your business and using it to ‘buy’ customers. Ideally, those customers will offer you a favorable return on your investment by purchasing from you on a repeat basis (we’ll look in detail at customer acquisition costs and lifetime value in an upcoming Masterclass).

The only way you will know if an ad is paying for itself is if you track and measure the results it generates. You need to know where your customers are coming from, how they found out about your business, and why they decided to take action.

You can use your lead tracking system to do this, and then assess the results at the end of a fixed time period. You can also put codes or “keys” on your ads to indicate where your customers came from. This includes actual codes on coupons that tell you which publication the ad was placed in and in which week, as well as different offers and bonuses: Buy 2 get 1 free vs. Free gift with purchase, or Guide to Home Energy Savings vs. 25 Ways to Save Money on Energy Costs.

Remember, effective print and classified advertising rarely needs to be flashy or clever.

Get into the habit of always asking yourself, “what am I trying to accomplish with this ad?” You can even write your purpose on a sticky note and put it on your computer screen to keep you focused. Then, make sure that your headline, message and unique offer all cater to that purpose.

Effective advertising doesn’t have to be complicated, expensive, or even cleverly designed. Like all aspects of lead generation, it really comes down to a strong understanding of your target audience, and knowing how to communicate with them.

So, in the next Business Growth Masterclass I’m going to help you become a better copywriter. You’ll build on the skills you cultivated creating strong offers and writing effective headlines, and learn how to craft persuasive text.

Oh, by the way, if you would like some help with the ideas discussed in this, or any of the previous Business Growth Masterclasses, or to get expert help with any other aspect of growing your business, use the following form to get in touch: (Listen, I know some of you don’t like filling in forms like this, but I promise you it will be worth your while. Go ahead!)

Thanks for tuning in!

Business Growth Masterclass 10: How to Create Marketing Materials that Work

Hello again everyone, and welcome to the 10th instalment in my series “Business Growth Masterclass”

As ever, before we begin, lets recap on the main points fromthe last Masterclass.

Checkpoint:

  • You have established which of your three draft marketing messages is the strongest, and incorporated it into all of your existing marketing materials
  • You have implemented a lead tracking and management system and trained your staff to use it effectively

Your marketing materials are an extension of you and your company.
How are yours working?

You can have a lot of fun creating marketing materials for your business. It’s an opportunity to work on a project that isn’t a spreadsheet, or a graph or an order form. You can really get creative!

Your materials get distributed in the world to send out a particular message (or messages) about your company and what you sell. They’re ambassadors for your business because they speak to your potential customers when you’re not there.

As you probably know, it’s easy to get carried away with marketing collateral. You’re surrounded by flashy, clever advertising everywhere you look, and when the time comes to create your own, you can’t help but feel that you have to keep up with the joneses.

Most of the time this doesn’t work. You spend more money, and see less impressive results. In this Masterclass, I’m going to show you some proven strategies for simplifying and strengthening your marketing materials, and focusing on the materials you need not the materials you think you think you should have.

In this Masterclass we will cover:

  • The marketing materials you really need – and the ones you don’t
  • The mistakes you might be making now
  • The elements each piece of marketing collateral should have
  • What you need to know about the design of your materials
  • What you need to know about testing, measuring and making mistakes

It’s easy to want to match your competition piece by piece – but when you’re trying to stretch your marketing budget, focus on the materials you actually need.

Just because your competition has an eight page, glossy colour brochure, doesn’t mean you need one to run a successful business.

When one brochure has the ability to eat your entire budget for marketing materials, you have to prioritise what’s essential and what’s just a “wish” or want. You need to make sure you’re spending on the items that are going to bring in the most return on investment.

Your marketing materials need to communicate your message to your target and motivate them to act. Do you really need a glossy brochure when black and white flyers will be just as effective? Think about this when making decisions about your marketing items.

Make choices based on how your target audience prefers to receive information. Do they prefer paper newsletters, or electronic ones? Are they environmentally conscious, or technology savvy? Do they appreciate personal contact, or just need to see information in a newspaper? Remember that how you communicate is often just as or more important that what you communicate.

Make green choices – your customers will appreciate it. Choose recycled paper and envelopes when you can, and print double-sided. Produce marketing materials in electronic format (like newsletters), and print limited runs of hard copy materials (like brochures).

What are the marketing materials that your business needs, wants and would like to have?

  • Logo
  • Business Cards
  • Brochure
  • Website
  • Newsletter
  • Catalogue
  • Advertisements
  • Flyers
  • Fridge Magnet
  • Branded Items (pens, memory sticks, etc.)
  • Employee Clothing
  • Cloth Bags
  • Product Labels
  • Signage
  • Email Signature
  • Blog
  • Letterhead + Envelopes
  • Thank You Cards
  • Notepads
  • Seasonal Gifts
  • Company Profile
  • Internal Templates (Fax Cover, Memo, etc.)

Create a list of your essential marketing materials then, below it, create a list of your “wish” marketing materials. You can use your “wish list” when you have a little extra budget, or are looking to create a “wow” piece. The list above is for you to use as a guideline – you may not need all of these items, or want to add your own ideas to the list.

Take your existing marketing materials through this audit, and look for opportunities to improve and strengthen.

Are you fighting for their attention with a powerful headline?
You have about four seconds to grab the attention of your reader with your headline. If you do, you have a few more seconds to convince them to read your subheadline. If you’re successful in doing that, you have a few more seconds to get them to read further. See what I’m saying?

Make sure your headlines:

  • Offer to take away pain or give pleasure
  • Hit your target market’s hot buttons
  • Bring up emotion
  • Are bold, dramatic, shocking or unbelievable
  • Answer the questions – what’s in it for the customer? why should the customer care?

Are you triggering an emotional response to a problem, fear, need or want?
Once you have their attention, you need to continue to keep it. Shake up their confidence in what they’re doing now, or the urgency with which they need to solve their problem. Put their fears, concerns and desires in black and white text in front of their eyes:

Ask them if they:

  • Are doing enough?
  • Can wait any longer?
  • Can sacrifice any more?
  • Are paying too much?
  • Are getting the best product or service for their money?

Are you building their trust or confidence in your ability to meet their needs?
You’ve got their attention, and tapped into their emotions, now you need to build their confidence in you ability to solve their problems and meet their needs. You’ll need to show them your solution, and prove that you can be trusted to do what you promise.

Tell them how:

  • You’re different from the competition
  • You’re highly qualified
  • You have documented results
  • You have a high number of happy customers
  • You get recognised from others in your field

Are you wowing them with your competitive edge?
You may be the best at what you do or have the best product but if your customers can’t get a hold of you when they need you, how valuable are you? Here are some examples:

Tell them how you do more than the competition:

  • 24-hour hotline
  • Housecalls, or free delivery
  • Customer rewards program
  • Other convenience services

Are you overcoming their objections before they’ve raised them?
It makes no difference what business you are in; there will always be objections to buying what you are selling. Most often the biggest objection is the price. You should confront them head-on by explaining why it’s worth paying your price. You need to put their fears to rest before they will be ready to buy.

Are you providing an element of risk reversal with a strong guarantee?
Stand behind what you’re claiming about the quality of your product or service, and offer a guarantee in your marketing materials. Typically, the strength and length of the guarantee indicate the quality of the product in most customer’s eyes, so create a strong one.

You can guarantee:

  • Performance
  • Benefits
  • Longevity
  • Satisfaction

Are you showing them what other people have said about your product or service?
Use testimonials to speak to your credibility and merit. Let the testimonials show your potential clients how trustworthy you are, and how much benefit they’ve received from your product or service. Make sure the testimonial addresses the problem that your customer had before they used your product.

Are you giving them an easy way to contact you?
Make it easy for customers to be in touch with you, or get more information. Clearly display your phone number and website address on everything you produce, and consider including a map of your store location so you’re easy to find.

Each piece should provide the following contact information:

  • Location (with map)
  • Phone / Fax / |Mobile Phone Number
  • Website
  • Free phone number
  • Email address

Are you giving them a reason to act NOW?
The last job your marketing piece has to do is motivate your viewer to take action. You need to make them want to call for more information, visit your website, or just come into your store. Invite them to take action on every page.

To motivate customers to act, you can:

  • Offer special “bonus” offers to quick responders
  • Make a time-sensitive offer
  • Tell them how rare your product is, or what limited quantity you have
  • Offer limited-time added value

Are you telling them what your product or service will give them?
Your customer doesn’t care about the features of your product or service, they only care about the benefit that feature will provide them. Customers buy benefits, not products or services. A client is looking to buy some more confidence from a new hairstyle, not a haircut.

Are you telling viewers the story of your product or service?
Remember that you are painting a story to tap into the emotions of your viewers. Detailed technical descriptions should be replaced with descriptions of how the customer may enjoy the benefit, and how they might feel.

The story will help the reader picture:

  • How they’ll feel after using your product or service
  • What they’ll look like using your product or service
  • What they’ll have time to do once they buy your product or service
  • The relief they’ll experience after purchasing your product or service

Are you giving them a reason to keep your marketing piece?
Give your customers a reason to keep your business card, brochure, newsletter or direct mail piece, refer to it, and pass it on to others to see. If you are selling hair care products, you can give your readers tips on how to combat split ends, frizz, unruly curls and heat damage. If you sell kitchen products, you can provide recipes that use your cookware or tools.

Some ideas for keep-able marketing pieces are:

  • Top 10 lists
  • Tips for product caretaking and longevity
  • Recipes
  • How-to’s

Flashy design is not important to your marketing campaign – but clear and professional looking materials are absolutely essential.

When it comes to the visual presentation of your marketing materials, you need to strike a balance. On one hand, you don’t want to spend all of your budget on design and production. On the other hand, the cost of sending out materials that don’t look and feel professional is usually much higher.

Going back to our discussion on time management, you’ll want to check in with yourself and see if your time is best spent designing your brochures, ads, flyers and direct mail, or if you should hire other resources.

Resources for marketing collateral design and layout include:

Graphic Design Agency This is generally the most expensive option. However, if you can find a small to medium sized agency you’ll typically be able to work within a reasonable budget. This can also be a resource to use for “wow” pieces, or design projects that require a little extra flair.
Freelance Designer Freelance designers don’t carry the overhead that agencies do, so typically their prices are a little cheaper. Try to find a designer you work well with and build a long-term relationship. Ask your network for referrals, or try listings like Craigslist.
In-House Designer If you don’t have the time to design your own collateral, but have heaps of marketing collateral and signage to design on a regular basis, hiring a dedicated employee may be your most cost effective option.

If you’re designing your materials in-house, here are some guidelines.

Consistency Your materials need to be cohesive and look like they come from the same company. Be consistent in your colour choices, font, headline styles and logo placement.
Simplicity Keep your materials simple and easy to read. This will save you money, as little details like full-bleed printing and die-cut edges are more expensive.
Information Hierarchy Think about the information that you need your customers to receive, and the information that is less important. Structure your page so that the most important messages jump off the page, and less pertinent details are at the bottom.
Colour Choice Colors give a visual message to your readers, and have many meanings including cultural connotations. Choose your business colors carefully, and stick to two or three.
White Space Every piece needs enough white space to give viewers’ eyes a place to rest when taking in information. The point here is not to crowd your piece with text and copy.
Photo Choice Put some thought into the photo you select, if you choose to include photos in your marketing materials. Details in the photo can unintentionally communicate messages about your business, so make sure they’re the right ones.

If you’re going to try something new – test, measure and make mistakes in small batches, or online.

You will need to constantly be monitoring the success of each piece of marketing material and looking for opportunities to strengthen and improve it. Since you already have your lead tracking and management system in place, this is a matter of sitting down on a regular basis and reviewing the leads each piece generated, and how many turned into sales (we’ll review this when we get to conversion rates).

Remember, always test, measure and then make choices.
If you’re not sure about a new strategy, do a test run to a limited distribution area, or test the message out online. Do small production runs of brochures or flyers you’re not sure about, so you don’t end up with heaps of flyers that didn’t work.

In the end, the strength of your marketing piece is in what you say and how you say it.

Too often, flashy design gets in the way of the message and you miss an opportunity to attract a customer. Simple, clear marketing materials deliver an easy-to-understand message to your target audience, and result.

If you would like some help with the ideas idiscussed in this Masterclass, or to discuss any other aspect of your business growth strategy, use the following form to get in touch:

In the next Masterclass, we will look at the role of your offer in motivating your audience to take action. A powerful – even irresistible – offer can act as an ace in the hole for your lead generation efforts. I’ll show you how to put one together.

We all know there’s only one way to provide customer service – Isn’t there?

Customer service excellence is a hall mark of all the best and most successful businesses, but it’s not a “one size fits all” solution.

We all know that our customers are unique individuals, but when we deal with them do we really treat them like that?  Do you see customer service as a slick and proven approach that is successful because it treats everyone the same?  I would like to introduce you to 4 of our customers:

  1. Samantha – she is a serious and quiet person who has an interest in detail and getting even the smallest thing right.  Never ask her about her family or social life – she sees it as none of your business and irrelevant to doing business.
  2. Eric – the life and soul of the party – in fact he’s always trying to get us to meet up in town for a “few beers”.  A conversation with Eric always takes longer than planned and is guaranteed to cover the rugby/holidays/weekend every time before we get down to business!
  3. John – it took along while to get to know John – he is quiet, shows little of what he is thinking, but is always polite and calm.  He is quick to compliment good service, but slow to complain if things aren’t going so well.  It wouldn’t be a surprise if he simply took his business elsewhere without saying anything.
  4. Julie – you know where you stand with Julie – she tells you exactly what she thinks, whether you like it or not!  She hates delay, can’t abide excuses and does not tolerate failure to meet deadlines – however small.

You may recognise some of these people amongst your customers.  They all seek excellent service, but the way that you deliver it to them needs to be subtly different.  If people buy from people they like, then it is certainly true that people stop buying from people that they don’t like – or who they perceive as having a different set of priorities to them when it comes to customer service.

If you and your team members could understand your customers’ differences and take account of them when delivering your products or services to them, just think how much more positively your business would be perceived!

The Service Profit Chain

There is no doubt that excellence in service is directly linked to profitability – the most profitable businesses invariably deliver the best customer service.  You can improve your customer experience by understanding their needs and expectations better.  You can achieve this by introducing DiSC to your customer service team.  Let us show you how.

About DiSC

DiSC is the most trusted behavioural communication and learning instrument in the world. DiSC is based on more than 80 years of research and development and is used across the globe in hundreds of training and coaching applications, with around 70% of FTSE 500 companies either using or having used the system.

For further information about the unique Everything DiSC products, or to arrange to have your own profiles produced, contact us via email david@wallshiremanagement.co.uk or telephone on 01209 613 060 today.

Best Regards
Dave Preston

Business Growth Masterclass 9 – How to Generate More Leads with Less Effort

Hello again everyone, and welcome to the 9th instalment in my series “Business Growth Masterclass”

As ever, before we begin, lets recap on the main points fromthe last Masterclass.

  • You have created three marketing messages using the step-by-step process
  • You have tested your marketing messages internally – with your staff, management and colleagues
  • You have started or are about to start testing your message externally – using advertising, direct mail or another lead generation strategy.

Has everybody done all that? Good. Ok, lets get started with this month’s masterclass.

What is the current picture of lead generation and management in your business?

Here’s the deal: in order to start generating more leads with less time and financial investment, you first have to spend time setting up systems and making some changes. Your goal after this Masterclass is to establish a solid lead tracking and lead management system, and make small tweaks to your existing lead generation strategies based on the work you completed in the target market and marketing message Masterclass. We’re going to look at many different lead generation strategies in upcoming MAsterclasses, but I want you to see the impact that the work you have already done will have on your existing strategies. I want you to start seeing results more or less straight away.

In this Masterclass we will cover:

  • The current status of lead generation in your company
  • The purpose of lead tracking and management systems
  • Types of lead tracking and lead management systems
  • How to set up a lead tracking and or management system
  • Qualified lead generation
  • How to get more results from your existing strategies

Do you know where your current leads are coming from, or how many you get on a daily, weekly, or by-campaign basis?

If I asked you to tell me right now what your top lead generation strategies are, what would you say? A big part of step-one is gaining a solid understanding of where your business stands right now in terms of lead generation. Otherwise, how are you going to know when your lead generation strategies are working? Or which strategies are working? In a few minutes, I’m going to show you how to set up a lead tracking and lead management system that works with your business. But first, I’d like you to write down what you think your top three lead generation strategies are right now.

Every business needs a lead tracking and management system. Do you have one in place?

A lead tracking and management system is absolutely essential to your business for a number of reasons. One, it is the only way to know which marketing strategies are working, and which ones aren’t. The information your system gathers will allow you to make educated decisions about marketing campaigns and investments. Two, it organises your sales and marketing efforts and manages contact information in a user-friendly way. It’s clear who you called, when, what you said, and when you said you’d follow up. Three, it enables you to manage your sales staff by tracking their progress on several leads at once. You’ll have access to an at-a-glance picture of their sales figures and productivity.

Your lead tracking system needs to:

  • record the leads that arrive by phone, in-store visit, and website visit
  • track the source of each lead over specific time periods
  • record pertinent customer information
  • be simple enough to be used by all staff members

Your lead management system needs to:

  • track your leads through the sales plan or process
  • increase customer communications or contact
  • keep track of correspondences and follow-up requirements
  • make it easier for you and your staff to close more sales

Here is a list of information you will want to gather from your leads.

Depending on the needs of your business and the lead tracking and management system you choose (i.e., do you need a mailing address, or just email address?) some of these items may be optional fields.

  • Company Name
  • Name of Contact
  • Alternate Contact Person
  • Mailing Address
  • Phone Number
  • Fax Number
  • Cell Phone
  • Email Address
  • Website Address
  • Product of Interest
  • Source of Lead (i.e., How did you hear from us?)
  • Reason for Enquiry

If it is appropriate for your business, you also may wish to gather demographic information from your leads – but keep this voluntary. This information would be ideally used in your market research analysis.

Keep in mind that your lead tracking and management systems need to be simple enough for everyone in your company to use.

Unless you are the only person in your company who manages incoming phone calls, greets customers and chases down leads, the systems you implement will need to be used consistently by everyone in your organization. Once you have decided on a system, schedule enough time to train your staff thoroughly and be open to feedback. Since you’re not the sole user, you’ll need to consider their thoughts on the usability of the systems.

Pick a lead tracking and management system that suits your budget, and offers the features your business needs.

Each business will have different requirements when it comes to lead tracking and management. A retail store will have different needs than an estate agents office, for example. The retail store may only need to record leads based on lead generation strategies, and keep lead information for their direct mail or newsletter databases. On the other hand, the estate agent will need to make contact with their leads on several occasions, and need a system that will record and remind them of those correspondences. Software for lead management ranges from simple to highly sophisticated, and can be a great investment depending on the needs of your business. Some CRM (Customer Relationship Management) tools are available online as a web-based system you can subscribe to and have access to on the road. I’ve listed the features and advantages to a number of different systems below – ranging from low-tech to high-tech, paper-based to web-savvy.

Index Cards Variety of sizes: 3×5, 4X6 or 5X8. Basic contact information on one side, notes on the other Easy to organise and sort This is a basic system used to manage leads by those who may be less comfortable with computers. This system will be effective at tracking low volumes of leads.
Rolodex More contacts than index card system Easily organised and compact Basic contact information on one side, notes on the other side Another basic system that will effectively manage leads without the use of a computer. While this system can store a higher number of cards, it is also only effective for tracking low volumes of leads.
Excel Spreadsheets Electronic system that is highly customizable by date, name, source or other variables Easily organised and analyzed Several worksheets in a single file allow leads to be tracked and contact managed Accessible for those with basic computer skills This is a slightly more sophisticated system that will allow you to track higher volumes of leads, and effectively organise the information that you collect into charts that can be analyzed. In Excel, you are able to work with a number of tracking sheets in a single file, and create hard copy tracking sheets for staff to use at point of sale and reception. Excel also has the capability of importing data from Outlook and Maximiser.
Database Management Programs High level of organization Unlimited space for notes and record-keeping Data-entry required Examples include: MS Outlook, MS Excel, Maximiser A more sophisticated system that will interface with Excel and manage high volumes of leads and customer details. Manages distribution lists for newsletters and direct mail campaigns. Primarily manages contact information, and provides space for notes, follow-ups and reminders. Tracking high volumes of leads without recording and inputting customer information is best done in Excel.
Customer Relationship Management (CRM) Software Web-based, and accessible from anywhere with internet access Organises leads and customers by name, company, date, or status Ability to attach documents (like proposals and contracts) to leads Ability to write notes and log correspondence by date View contact history and status Interfaces with e-mail marketing programs Example is SalesForce A highly sophisticated system with advanced features. Tracks a high volume of relationship-based leads, and provides a detailed, feature-heavy system for lead management. Not ideal for retail businesses, or businesses that need to track a high volume of leads with minimal customer information attached.
Website Analytics Monitors and analyzes website traffic and online advertising Tracks number of people who visit your site, where they came from (search engines, online advertisement, website link etc.), how long they stayed, the pages they visited, and which page they left the site from. Google Analytics is an easy-to-use example An ideal way to track and analyze website traffic to complement your overall lead tracking system. This is not a complete system on its own. Requires the insertion of a specific code into each of your webpages, or each of your online advertisements. Monitors usage statistics, and generates reports, charts, graphs, etc.

Bringing qualified leads into your business will save you and your sales team time, and result in higher revenues.

Qualified leads are simply the potential customers who are the most likely to buy your your product or service. They’re not just in your store taking at look at the latest features in refrigerators, they’re in the market to purchase a refrigerator. They’re not wandering in to see what a £500 handbag looks like, they are the kind of person who can actually spend £500 on a handbag. Some of the people who will call you or visit your business will never buy from you no matter how good your sales scripts are or how much time you spend overcoming their objectives. There are a variety of reasons for this – and you’ll never eliminate all of these people – but you will need to focus on bringing in more of the people who are ready to buy. The good news is you have spent so much time and energy cultivating a comprehensive knowledge of your target market, that you’re in a great position to increase the number of qualified leads you bring into your business.

How do You Get Qualified Leads?

The crux of qualified lead generation is making decisions based on the market research you completed on your target market. You basically need to know where to reach your market, and how to speak to them. When you are designing, executing and making choices about your lead generation strategies, always consider these questions.

Who is my target market? Write down your target market description to keep you focused on the specifics of this group of people.
DISTRIBUTION IS EVERYTHING: How does my target market like to receive information? Do they read the newspaper? Pick up the family mail? Spend hours on Facebook? Subscribe to Reader’s Digest? Listen to newsradio on long commutes to work?
What motivates my target market to take action, and how can I tap into that motivation? How will you tap into your target market’s emotional response? What issues or needs will mean something to them, and drive them to your business to solve them.
Where can I place my marketing message so my target market will see it? Look at what you found out in your market research about your target market’s hobbies, activities and interests. How can you place your message or your product or service in their path?
What can I offer my target market to entice them to purchase from me? Can you offer your target market something special, rare, or time specific that will appeal only to them?

I’m going to show you how some little changes will generate big results for your company in short order.

Once you’re set up with a testing and measuring system (your lead tracking and management systems) to evaluate the success of your lead generation strategies, you need to start by looking for opportunities to beef up the strategies you’re currently working with.

Use your new marketing message. Make sure that you have put your new marketing message on all of your marketing materials, where new and existing customers can see it. Revise your standard advertisements to feature the strengthened copy.
Strengthen your offer. Create an offer that’s too good to refuse – not for your entire target market, but for your ideal customer. How can you cater to their unique needs and wants? What will be irresistible for them?
Refocus your direct mail campaign. If you’re sending your direct mail to entire postal code areas, stop and refocus. If your distribution area is that broad, chances are the copy on your postcard or letter is too broad as well. Brainstorm ways to narrow your distribution and only hit your target audience. Purchase consumer lists based on demographics, not just location, or limit distribution to specific housing types. Of course, make sure you rework the direct mail piece to feature your marketing message.
Let your target market’s behaviours dictate your distribution plans. As I discussed above, the more you can tailor your strategy to the needs and habits of your target market, the strong your results will be. Look for opportunities in your existing direct mail, advertising, flyer drop and other strategies to get specific. Narrow the demographics of your list, or place an ad in a niche publication. Brainstorm new ways to target your market’s emotional reactions.
Tap into low-cost advertising. Advertising in places like the YellowPages, classifieds sections, e-mail newsletters and Google Adwords can be a great place to test your marketing message for minimal investment. In an upcoming Masterclass you’ll learn how to place ads in the YellowPages and other listings that stand out from the competition.
Look for some referral business. Referral business is desirable because it usually brings qualified leads into your business. Someone has referred them to you based on a current need or desire. > Provide your customers with an incentive to bring business to you. Reward successful referrals with discounts or gifts. > Create a referral chain by giving each new customer three free coupons for products or services that they can give to their friends. When their friends come into your business, do the same. > Create complementary alliances with non-competitor businesses with the same target market. Cross-promotion or cross-referral strategies will benefit both businesses.
Website sign-up Add a feature on your website that encourages visitors to sign-up for newsletters or other communications. You can also set up your website so that potential customers need to fill out a simple form before they have access to “free” information.
How to Create Marketing Materials That Work The next Business Growth Masterlass will walk you through some tips and helpful suggestions for improving your marketing materials. Revise your existing materials based on these suggestions, and watch your leads multiply.

Stop using strategies that don’t work.

Now that you have a comprehensive lead tracking system in place, you’ll be able to track the leads that each strategy is responsible for generating. When you complete your first few campaigns with the lead tracking system and analyse the numbers, compare the results to the initial predictions you made. Were you correct in your assumptions, or were you surprised by how things shook out. The purpose of testing and measuring using a lead tracking system is to figure out which strategies work, and which don’t, as well as which strategies work best, and which generate mediocre results. This not only will save you money but is incredibly useful information to have when developing marketing budgets and, of course, trying to drive sales.

READ THIS: A quick cautionary note on conversions.

While the focus of  recent Masterclasses has been lead generation, remember the first part of the formula: No. of leads x %age conversion rate = No. of customers. You’ll be working on conversion rates in just a few Masterclasses from now, but my point is don’t lose sight of the relationship between leads and conversions in the overall formula. Remember that when more leads start flowing through your door, you’ll need to have the resources and systems in place to give a high level of customer service and to convert them into loyal customers. You’ve put effort into generating these qualified leads, but if you don’t have the resources in place to give them the attention required, you’ll lose them.

Once established, your lead tracking and lead management system should require minimal time investment…if you keep it up to date.

If you would like some help with the ideas introduced in this Masterclass, or to discuss any other aspect of your business growth strategy, use the following form to get in touch:

One last reminder before I sign-off – keep your systems up to date. The biggest pain (and drain on time) is having to go back and enter heaps of data into your database or management system because someone has let it pile up. It’s also a huge missed opportunity! If you fall behind on your lead tracking system, because you won’t be able to effectively evaluate your campaign or strategy. Or, you may have missed a lead because you didn’t follow-up soon enough. Be diligent, and set a strong example for your staff members. Good luck!

Do You Know How Your Client’s Make The Decision To Buy What You Sell?

Have you ever given any thought as to how your clients make that all important decision as to whether or not they will buy your product or service? What is it EXACTLY that triggers their buy / don’t buy button? Is it really price that controls their decision, or are other factors involved?

What you need to know…

Believe it or not, price is actually one of your prospects last considerations. Human nature says that no matter who buys what you sell, they will always want “the best deal.” That doesn’t mean the lowest price, but it does mean they want the most “VALUE” for the price they pay. The perception that your product or service offers extraordinary value controls their final decision.

Why you need to know this…

The key is to create “extraordinary value” as it relates to what you sell. In fact, if you do this, you can even charge a much higher price, providing the perception of value justifies that price. Unfortunately, most business owners don’t have a clue how to create “extraordinary value,” and therefore don’t offer it to their prospects, costing themselves massive market share and a boatload of lost revenue.

To create value, a business must “innovate.” You must understand the things your clients want from your product or service, and then use innovative ideas and solutions to either remove the pain and frustration they normally associate with what you sell, or enhance the benefits they receive from using it.

For example, the working mum who feels frustrated and worried when she drops off her child at daycare because she doesn’t know how the child is being cared for finds tremendous relief and peace of mind (extraordinary value) when the daycare installs Web Watch… a 24 camera surveillance system that allows parents to view their child online, anytime.

The cost to you if you fail to act…

If you fail to create “extraordinary value,” then you look like, feel like and smell like your competition. You will be forever doomed to compete with them on price, and when you’re forced to compete on price, you have just lost the battle. There will always be someone willing to undercut your price… ALWAYS!

By innovating your business, you begin to separate your business from your competition. You begin to eliminate your competition from the minds of your prospects… and you will have your prospects literally saying to themselves that “I would be an absolute fool if I bought this from anyone else.”

Innovation attracts your “ideal” clients to your business. These are the clients that will buy more from you at premium prices. They will spend more money and buy from you over longer periods of time. Your revenue and profits begin to skyrocket as you begin to add unprecedented market share.

Look for ways to “innovate” your business and do so in such a way that you create extraordinary value in the minds of your prospects.

Business Growth Masterclass Sesssion 7: How to Identify Your Target Market

Hello there friends, and welcome to the seventh installment in my series “The Business Growth Masterclass”.

I’ve called this session:

How to Identify Your Target Market

But first, as usual, lets recap the homework set in the last installment of the Business Growth Masterclass.:

After the last session, “Managing Your Time To Make More Profit”:

  • You know what your time is worth on an hourly basis.
  • You know what time(s) of day you are most productive.
  • You have five strategies for improved personal time management.

 Yes? Brilliant! Now let’s get on with this months material.

Determining your target market is your first job as a business owner

This Masterclass officially marks the beginning of using Step One of the five-step process, (see November’s Masterclass) which shows you to how to bring a high number of qualified leads into your business.

Qualified leads are the group of people who are most likely to buy from you – they have a current need, problem or desire that your offering will solve or serve. These people are your target market, or ideal customers. Qualified leads are generally easier to convert into customers, so a high number of qualified leads mean a high conversion rate and, of course, more sales.

A great example of this going wrong… you own a hot dog and burger business and are standing outside a large conference venue, waiting for the lunch-break so you can take advantage of a huge rush of people in a short period of time (a great way to do business) to give away small hotdogs to generate customers for your business down the road. You have prepared all your toppings, flyers with simple directions, arranged for staff to handle the rush and stocked up to the gunnels to ensure you do not miss a single prospect. The group comes out and you manage 25 free hot dogs given away when you were expecting 500.

What went wrong? You did not realise the conference attendees were members of a health and wellness group comprising of 95% vegetarians!

This wouldn’t happen to me I hear you say, but the same kind of mistake COULD be made by any business owner – in fact, a lot of the businesses I work with have made just this mistake, but in the context of their own marketplace. The morale of the story; if you are talking to the wrong audience it doesn’t matter how good your offer is – you are wasting your time. Talking to your target market is absolutely CRITICAL to successful marketing.

So, your first job as a business owner is to work out who your target market is, and how the people in it think and behave.

In this Masterclass we will cover:

  • How your target market influences your marketing choices
  • A step-by-step process for identifying your target market
  • Types of target markets
  • Examples of target markets
  • Market research strategies

Generating qualified leads will make it easy to boost your conversion rate, because your prospects will already want or need your service.

A target market is simply a group of people with something in common – things like age, gender, opinion, interest, or location, – who will purchase a particular product or service. Your market can be broad or specific in scope, and it is unique to each business or industry.

Knowledge and understanding of your target market is crucial to the viability of your business. You have to know if there is enough demand for your product, or enough interest and need for your service. You have to know how to communicate with your customers, and understand their thoughts and behaviours.

Without a comprehensive understanding of your target market, you can’t make smart choices about your introductory offers, marketing strategy, pricing structure, and product or service mix. It’s kind of like driving a car with a blindfold on – you’d be headed for disaster.

In addition to being essential to confirm assumptions and understand purchase motivations, market research is something you will need to get into the habit of doing on a regular basis to monitor trends and stay ahead of the competition. Identifying your target market is not always easy, but I promise it will pay off in spades, so stay committed to your efforts as you work through this Masterclass.

Let’s start with an easy, step-by-step process to identify your target market.

You probably already have an idea of who your target market is – or who you want it to be. Start by describing who you think your target market is in two or three sentences on a sheet of paper.

As you work through this process, you may find that you were correct in your assumptions, or not. Either way, this Masterclass will uncover invaluable information about your audience.

When you set out to identify your target market, you need to find the group of people that has these four characteristics:

  • They have a particular need, want or desire.
  • They have the financial ability to purchase your solution to their need, want or desire.
  • They have the power to decide to purchase your product or service.
  • They have access to your business, through a physical location, Internet or catalogue

First, take a look at what your product or service offering is to your potential customers.

To find the group of people with the characteristics listed above, you first need to answer the following questions about your product or service:

1. What is the need, want or desire that my product or services fulfils?

 Does your offering primarily fulfil a desire, or serve a need or cater to a want? What is that desire/need/want?
2. What does my product or service cost?
 Do you offer a high-end product, or low-cost alternative? Do you sell large items, like a kitchen appliance, or small items, like household cleaning products?
3. Who makes the decision to purchase my product or service (who has the power or authority)?
 For example, if you provide a product or service for children, their parents are the people who make the decision to make a purchase.
4. How are my products or services accessed?
 Does your ideal customer need to live in the same town or region as your business? Or can they access your products online, or through a catalogue?

Demographics 

Now let’s look at the demographic characteristics of the people that need, can afford, locate and decide to purchase your offering. Some of the information in this table may be less important than others (like ethnicity or religion) depending on your product or service and the market you are trying to attract.

Age In general terms, what is the age range that my product or service caters to? Kids? Teens? Adults? Seniors?
Income How much do they have to make to afford my product? Is this single or double household income? Low? Medium? High?
Gender Does my product or service appeal to men, women, or both?
Generation What is the generation of my customers? Based on the age range I identified, are they baby boomers? GenX? GenY? Where do they stand in the overall family life cycle?
Nationality Is nationality relevant to my product or service?
Ethnicity Is ethnicity relevant to my product or service?
Marital Status Are my customers married? Single? Divorced?
Family Size Does my product or service cater to large or small families? Is family size relevant?
Occupation or Industry Does my product or service appeal to people in a certain occupation, or industry?
Religion Is religion relevant to my product or service?
Language Is language relevant to my product or service?
Education What level of education do my primary customers have? High school? University?

Psychographics

Now lets look at your target market’s psychographics. Psychographics are the qualitative characteristics of your target audience, like personality, values, attitudes, interests, or lifestyle. These characteristics can give you a lot of insight into how to best interact and communicate with your target market.

Lifestyle What kind of lifestyle group does your audience fall into? Are they conservative or trendy, travelers or soccer moms? Are they thrifty or extravagant?
Values + Beliefs What are their values and beliefs? Would you consider them environmentalists or safety conscious?
Attitude What kind of attitude do they have? Are they positive or negative? Open or critical? Easily led or opinionated?
Motivation Are your customers opinion leaders or followers? Do they tell others what products they need, or do they need others to tell them what is trendy and what works?
Activities + Interests What do they do in their spare time? What are their hobbies and interests?
Social Class What social class does your audience belong to? Lower, middle or upper? How much extra money do they have to spend on luxury items?

So, now that you’ve gathered all this information, what does it tell you about your ideal customers?

You’ve done enough research now to create a picture of who you think your ideal customer is. Being as specific as you can, write a 1-2 sentence statement about your target market.

For example:

  • My target customer is a successful young professional; a middle-class man aged 20 to 35, who is single, makes more than £10,000 per year, and is physically fit. He is university educated, and has an active interest in economics and politics.
  • My target market is affluent new mothers; married women with children under five years old, between the ages of 25 and 45, and have a household income of at least £50,000 annually. She is the trend and opinion follower, and her purchase motivations are driven by her peer group.

Now that you’ve made some educated assumptions about who your target market is, you’ll have to use some market research strategies to confirm them.

Market research is the study of a particular group of consumers – or markets. It is one of the most valuable activities you will work on as a business owner, since it keeps you connected and informed about your customers thoughts, motivations and behaviours. Market research also minimises risk and assumption-based decision making, which will improve the success rate of everything you do for your business.

When you begin your market research, you need to start out with a clear question that you want answered. Otherwise, you’ll quickly get off track and fail to end up with the information you really need. Think about questions like:

  • Am I right about my target audience assumptions?
  • Is my target audience interested in my new product or service?
  • I need more information about my target audience’s purchase motivations
  • What new trends are my target audience following?
  • What recent economic developments have impacted my target market?
  • How can I improve my customer service?
  • Has my target market changed in the past year?

Market research needs to be conducted regularly – regardless of how long you have been in business, or how well you know your target market. Trends shift, and environments are impacted by economic and political factors beyond your control.

There are two main types of market research – primary and secondary – and three main areas of market research – consumer, competitor, and environment.

Here’s a really helpful chart to use to organise information when you’re conducting your market research. This will help you conduct research that is comprehensive and cost effective.

PRIMARY
(First-hand information gathered from your customers or about your customers. i.e., customer surveys, observations about the competition, etc.)
SECONDARY
(Second-hand data or research that has been completed by or for someone else, but can be applied to your objectives.)
CUSTOMER
(Demographic, behavioural, psychographic and geographic characteristics.)
> info right from the source
> can be time consuming and costly – but most valuable
> most current
> most specific
> statistics
> trade journals
> public surveys by larger companies
> government publications and surveys
COMPETITION
(Marketing, product and consumer observations you can make or gather from your competition.)
> what works, what doesn’t
> adding value to existing offering (to give yourself an edge
> types of products that consumers are interested in
> types of lead generation strategies your competition uses, and the types of potential customers that you currently see
ENVIRONMENT
(Social, economic and political trends that may impact your business or your customers thoughts and behaviours.)
> newspapers
> trade journals
> consumer reports

Strategies for cost-effective secondary market research

Demographic Research (Customer)
Basic demographic research is something you won’t have to conduct yourself. Every town or region will have demographic information available online, or in town halls, libraries and business centres. National and regional statistical information is also available online or through government agencies.

Online and Consumer Research (Customer and Environment)
Primary market research can be expensive, so secondary research on general consumer behaviour and purchase data can be extremely useful for small businesses. Some information will be available online, while other information (usually free) will be available at your local chamber of commerce and business centres.

Primary market research strategies you shouldn’t miss.

Ground Research (Customer or Competition)
Spend some time in your local area at different times of the day observing and talking to the people who live, work, or spend time there. What do you notice about the area? How well is it taken care of? Why do people spend time here? Is anything missing? Get a sense of their age, gender, clothing and any other features.

Competing Businesses (Competition)
If you have direct competitors in the same local area, spend some time being “their” customer and making observations about their business. How do they advertise? What market are they targeting? Is there a niche market that is being missed?

Surveys (Customer or Competition)
Surveys are the most popular way to gather first hand information from your existing and potential customers. Take your time to administer them carefully and thoughtfully – surveys can get complex and variables can be high.

  • Keep your questionnaire short and focused on getting at the information you need to answer your market research question. This will encourage a higher response rate.
  • Remember that your information will only be as good as the people you ask for it. Try to get as broad a cross section as possible. Depending on your market research question, you may not want to limit it to your existing customers.
  • Choose a survey method – telephone, web or paper-based – and understand the pros and cons of each. Research some survey templates, and spend more time than you think you need to on crafting your survey.
  • Include basic demographic questions on your survey so you can cross reference responses with factors like age, income, sex, and profession.

Website Analysis (Customer)
Use a website tracking system like Google Analytics to monitor how visitors to your website behave and use the information available. These programs will allow you to see how many people visit your site, where they are from, what pages they are looking at and how long they spend on your site.

Customer Loyalty and Purchase Data (Customer)
Your point of sale system (if you have one) – depending on the level of features it offers – may also be able to run reports on customer purchase patterns and trends. If you have a customer loyalty program, you can keep track of purchase information in each customer’s file or account. The type of information you’ll need to keep track of here is behavioural: brand loyalty, product or service usage, purchase frequency, and readiness to buy.

Focus Groups (Customer)
Assemble groups of six to 12 people and ask them general and specific questions about their thoughts, opinions and habits as related to your marketing question. Be sure to assemble a cross section of people that is representative of your target market.

When you’ve completed your market research, analyse what you’ve learnt. Go back to your original question, and critique the outcome.

How has your market research supported the question(s) you set out to answer? Were your original assumptions confirmed or refuted?

  • Does my target market exist in my geographic area?
  • Does my target market actually want what I’m selling?
  • How does my target market want to purchase from me?
  • Is my target market interested in my new product or service?
  • How does my target market want me to communicate with them?
  • Is my target market large enough in my local area to support my business?
  • Are there areas of my research I could dig into for more information?

You may discover some hard facts to face about your business. Perhaps there is not a large enough market base in your area to support your business. Maybe you’ve spent a few hundred or thousands of pounds going after the wrong type of customers. This is all okay – don’t get despondent – it’s all valuable information that you can work with to make better decisions about your marketing strategies and product or service offerings in the future.

If you have flexibility in your product or service, you may be able to find ways to enhance your offerings and extend your target market to include more people, or a larger share of the marketplace.

Your market research is ongoing – each time you talk to a customer, supplier or sales rep, you’re gathering information about your clientele, and thus conducting market research. Consider keeping a log at the point of sale for staff to use to record customer comments and complaints. Review the log for customer returns, and reasons for returns, to get valuable feedback on your offering.

Remember, audiences, trends, products and services change, so stay ahead of the curve and keep on top of your market.

Plan to make market research a regular part of your business, and schedule time and money for primary research at least once a year. This is the only way to stay ahead of the competition when it comes to trends and environmental changes beyond your control.

If you would like some help with the ideas introduced in this Masterclass, or to discuss any other aspect of your business growth strategy, use the following form to get in touch:

The next few Masterclasses are about applying the information you have learned about your target market to refine your marketing strategies. You’ve clearly identified who your target market is, and how those people think and behave, so your next task is to determine what to say and how to reach them.

In the next Masterclass, we’re going to look at your marketing message and see how clearly you’re communicating with your audience. The strength of your marketing message is the backbone of your marketing materials, and a huge factor in the success of your lead generation strategies.