From my archives:
This week I sat down with a friend of mine who had reached the one year mark in their business. There was a tone of frustration in their voice.
So, first of all we examined just what numbers were needed to make it all work. After we looked at their closing ratio, and retention rate, it was determined that over 12 months, they needed to get their message to 3000 people. Of that 3000, 33% would likely become customers. This 1/3 conversion rate is pretty standard in a lot of sales positions. (If someone is hitting 33% in my company, then they should be doing pretty good.)
We discussed the way their parent company told them to market themselves and it sounded like a shotgun approach. Next we examined the results for the dollars spent. This was really bad news. After looking at the numbers, it was costing them $41 dollars to get a new client. Problem is that they earned about 1/2 that amount. Ouch.
I saw a restaurant try the shotgun approach a couple of years ago. They went bankrupt.
Here is an answer that you can spend hundreds or thousands of dollars to learn by going to a seminar by some hot-shot marketing/advertising guru, or I’ll give it to you free. This advice is priceless:
1. Know your numbers. Odds are that you don’t know how many new clients you need each year. Find out. If you are in the Fort Wayne, Indiana area, contact me and I’ll help you. In the case of the business that I spoke with this week, the number was only 3000 people. There are 377,000 people living the the SMSA. They only need to talk to 3000 of them face to face. (Less than 1%!) And convert only 1/3 of the 3000 to customers based on their track record of success.
2. Target your number with enough advertising and marketing. So instead of reaching 377,000 people, you now only need to reach 3000. That’s 3000 over the course of 12 months that will become potential customers, of which you convert 1000 into paying customers. So present yourself week after week or better yet day after day to those 3000 people with a reason for them to talk to you with your advertising and marketing. Pick the most appropriate medium to do this. Of course I believe radio is often the most effective way to do this, I spent 20 years in that business, however there are others too. Answer this question: would you rather convince 100 people 10% of the way to do business with you or 10 people 100% of the way to do business with you. The later pays, the former costs. That’s it. Become a sharp-shooter, not a shotgunner!