Joseph had reached the end of his rope.
It had been just 10-months since he launched his residential construction business when Joseph was referred to me. As we completed his “New Player Benchmark” (all clients at RPM Success Group are considered “players” in the game of business) Joseph was expressing how frustrated he was and questioning whether he’d make it to the one-year anniversary for his company. When Joseph started to list the methods of marketing he had applied up to that point, I immediately saw why he was so frustrated.
Joseph had fallen into a common trap that many business owners fall prey to.
There are literally hundreds of ways to market your business and create surging streams of new prospects and clients. But all those methods boil yield three specific impacts – the only three ways to grow your business.
Each and every marketing method you will ever employ will (primarily) either:
*Increase the number of clients you serve.
*Increase the number of times you serve them in a week/month/year.
*Increase the total dollar amount of each sale.
Choose a great marketing method that doesn’t match the type of growth your business needs and your success will be uncertain at best. Joseph knew what his goals were, but he didn’t understand how each marketing method he chose would grow his business in a different way.
For example, one area Joseph put quite a bit of energy into was a customer referral program. He promoted it to everyone he met, provided excellent incentives to his few current clients and even placed ads touting the benefits of working with a contractor who grew their business through referrals vs. pure marketing. While all these efforts were rooted in a proven low-cost, hi-impact marketing principle – investing nearly 50% of his marketing resources into this method was not having the impact on the business that Joseph had intended.
Joseph had matched a great marketing method (incentive based referral system) with the wrong goal (bringing in a significant volume of new prospects.) While this method would have been an excellent tool to compliment other methods, it should not have been the primary way Joseph expected to quickly grow his business from scratch. As a new business owner, Joseph’s job was to focus on #1 from the above list – increasing the number of clients he attracted so he could build a critical mass of satisfied clients who would help him achieve the type of exponential growth he was looking for.
To correct this, what Joseph and I did together (and what you will need to do yourself) was to clarify exactly what his current stage of growth was and what his immediate goals were. Joseph and I sat down and developed a simple strategic plan that would allow him to attract a significant number of pre-qualified prospects while simultaneously build up his back end. Armed with this strategy, Joseph and I were able to look at a targeted number of ways he could achieve this specific goal.
The choice he made was to meet with a new window manufacturer in his area and form a strategic partnership deal that would feed him plenty of new “basic” installation jobs. It turns out that more than 60% of those window replacement clients added on at least $5000 in additional work to the core work – plus they were now Joseph’s clients, not the manufacturers. Within just 9-months Joseph had the critical mass he needed to attract more business than he could handle without one dollar being spent on advertising.
Once you understand your growth stage and know what your marketing goal is for that stage, then (and only then) will you be able to choose the best marketing method to use.
For instance, let’s say you’re an established retail business and you have a solid base of satisfied clients. They visit your store and buy every time they come in – but they visit irregularly. You can employ a more varied set of marketing methods with different impacts on growth. Actually, I’d advise you to employ at least three marketing methods so you can exponentially increase your business growth.
You’d want to:
*Simultaneously attract more new clients (maybe with a special sale);
*Increase the frequency of purchases made by clients (possibly starting with something simple like a frequent buyers club);
*Increase the total of each purchase made.
This last point is not what you think though. You don’t have to raise prices. Actually you can lower individual prices and still increase the total of every sale you make. (Need a hint how? Can you say “value meal”?…)
Many people ask what I mean when I say exponential growth. Here’s a pretty straightforward explanation.
If you only increase one of the three areas by 10 percent you’ll grow linearly – a total growth for the business of 10 percent. But if you grow all three areas by 10 percent you’ll grow geometrically – a total exponential growth of 33.3 percent. The point is that growth of 33.3 percent in any one area is a serious challenge. But increasing growth by just 10 percent in each area is pretty painless with the right methods.
No matter what stage of growth you’re at, most of the growth goals you have can be met by using low-cost, hi-impact marketing principles. That means lower investments in your marketing with higher returns.
Stop restricting your growth, accepting dismal returns on your efforts and spending more money on marketing that you need to. Start on the road to exponential growth today. Simply determine your specific growth stage, clearly define your immediate growth goals and then step outside the box of conventional marketing to pick the best, low-cost hi-impact marketing method that will help you get there.
”’John-Paul Micek is the lead business strategist and COO of the leading international business coaching organization RPM Success Group