Posts Tagged ‘Radio’
This Is Where Customers Are Going!
Remember when you were a kid, you ran out the door and then heard your Mother calling, where are you going? That’s what many local businesses are doing with their customers today. If you are the one calling, it’s most likely too late because your customers are off looking for what you didn’t have to keep them around the supper table. In this picture you are behind them calling out not in front of them engaging and sharing, drawing them in building a relationship, a relationship that builds loyalty and increased return on Investments. For many this sounds like way too much work and don’t have time for this new way of doing business. This new way is happening and you will have no choice, this new way is called Social Media, resistance is futile, you will be assimulated.
Businesses today will have to figure out how to integrate multiple Social Media Networks into there web presence, their marketing strategy and above all incorporate it into the business plan as a another way of generating a ROI. Keep in mind that Social Media is not the Messiah, it is one of many tools to use to build a stronger more viable business. Reaching out to millions of consumers who thrive online around the clock requires an investment, a different type of thinking and some courage too. Many business are still wedded to a traditional marketing approach, based on TV, radio and print ads, Social Media seems harder to understand.
The biggest change taking place, or the shift as I see it, there is no gap between the CEO and customer. They now talk directly to each other, there’s no need for the middleman. Support costs are dropping, some businesses are using these Social Mediums to reach customers and save large dollars in doing so. Take Comcast as an example, for more than a year Comcast has pioneered the use of Twitter to speak directly to it’s customers. It’s Twitter page @comcastcares has 28,000+ followers. Software maker Sage North America, to cite another example, routinely receives instant feedback from hundreds of people within an hour on specific products and services. Another example is in sales, those who visit MyFICO’s community website are spending 41% more than other customers!
Businesses don’t think in terms of inbound marketing, they are very good at outbound marketing. Outbound Marketing is only half the equation in today’s new market place. A great resource to learn about Inbound Marketing is Chris Brogan & Justin Levy’s Inbound Marketing Summit.
There are multiple shifts taking place but increasingly, consumers don’t search for products and services anymore. Rather, services come to their attention via social media networks like Twitter. So if you are wondering where your customers are going, look to the Social Networks a plenty, don’t believe me, here is another example of a National pizza chain, Papa John’s added 148,000 fans on Nov. 17, 2008 through a guerrilla marketing campaign on Facebook. It offered a free medium pizza to anyone who signed up to be its fan on Facebook. The promotion gained it thousands of customers and drove its Web traffic up 253%. It now has more than 300,000 fans and hopes to top 1 million by the end of this year.
I could list many, many more examples of how businesses are winning and using Social Media to enhance existing marketing efforts. When was the last time traditional marketing campaigns garnered such ROI’s as some of these businesses are experiencing in today’s new social environments? Your customers are in these social networks and you had better be there to.
Now you know where your customers are going, the question is….are you going ahead of them?
Return On Investment Selling
In July I wrote an article for you called, ” Your Break Even Point “. The premise was to help you calculate that number and for you to have a better understanding as to why you might be loosing money everyday and not know why. Your business depends on you knowing! I mean it’s not something real obvious because it’s kind of hidden, if you don’t have the right indicators in front of you everyday you won’t see it. Hopefully you were able to figure out what those indicators might be and you are monitoring them daily. I’ll assume you’ve done that because next I want to walk you through an advertising slash marketing concept with you.
Years ago when I was selling Radio Advertising we used a thing called Return On Investment Selling, it was an education and very interesting. The program was to show how you would be able to pay for a new ad campaign and make money too! Yep, pay for the advertising and make your desired ROI, sounds to good to be true right? Well….yes & no. Let me lay out a scenario and we’ll walk through this together, I think you will find it most interesting.
I’ll change the names and places to protect the innocent, just kidding. I’m going to take you through a simple Growth Objectives equation and an Investment Analysis so you can understand the number at the end when I’m finished. Oh, and the Forward Slash ( / ) means Divide By in my equations if I don’t use the ÷ Symbol, I thought I should clear that up right upfront 🙂
Let’s pick a market, let’s say you are in the furniture business and the Market Potential was say 5 Million Dollars. That means 5 Million Dollars in business is being done in the Market your business operates in. Lets keep it simple and say you have a present Gross Sales figure of $500,000. That means you have a 10% market share. But you want to realize a growth objective of $100,000 out of your market, what kind of additional penetration do you need to achieve your goal? You would need 2.2% more, here’s how I figured it out:
100,000 ÷ 5,000,000 – 500,000 = 100,000 ÷ 4,500,000 = .022 x 100 = 2.2 (actually 2.222222)
If you’re struggling with the equation, get your calculator out and punch it up. It works.
So now we know the Penetration needed to reach a $100,000 Growth Objective in your Furniture market. Next I’ll break down how many customers or prospects it will take per day to achieve your goal of One Hundred Thousand Dollars.
To make this equation work we will need to know a few things first before it will work. We need to know what the average customer worth is in your store, how much each customer spends in your store. We also need to know what your closing ratio is, a great way to see how well your sales staff produces I might add.
For the purposes of this exercise I’ll use an average customer worth of $1,000 and a closing ratio of 40%. That will keep the numbers easy to work with. The equation is somewhat simple, I’ll try to lay it out that way.
$100,000 / $1,000 = 100
Growth Objective / Avg. Customer Worth = Additional Customers Needed
100 / 40% = 250
Additional Cust. Needed / Closing Ratio = Additional Prospects Needed
250 / 312 = .08
Additional Prospects Needed / # of Selling Days (Days Open) = # of Prospects per day
Is the number of prospects needed realistic? Yes No
This is only part of the equation, this merely tells you how many prospects per day you would need above and beyond you current customer base over the course of one year or 312 business days.
OK, we now know what the daily number is, but it still doesn’t tell us what the additional Gross Profit is going to be. Well, if your Growth Objective is $100,000 we now need to multiply it by the Average Gross Margin. Let’s use a simple number and one that might be realistic, let’s use 25%. Using our numbers from above this is how the equations looks:
$100,000 x 25% = $25,000
Growth Objective x Avg. Gross Margin = Additional Gross Profit
So in order to achieve the additional gross profit of $25,000 you were going to need to make $100,000 more (above and beyond) in business over the next year. We figured out how many new prospects / customers it would take to hit that number (0.8 per day) and we felt it was realistic. Now, what kind of ROI did you want to achieve, I’ll assume you wanted 100%! You want to make $100,000 in additional business which would give you an additional gross profit of $25,000 and you want a return of 100%, right?
The question begs to be asked…..HOW?
Well, obviously you would have to do something different than you have been doing to achieve that fine 10% market share. You want to grab 2.2% more of that market right? That means you have to do something above and beyond what you are already doing in your advertising efforts. You WILL have to put more advertising dollars into achieving your goal of 12.2% Market Penetration, your $100,000 Growth Objective and put the additional $25,000 Gross profit in your pocket.
The ROI I’m talking about is what you have to spend in additional advertising dollars to make it happen. You are probably asking yourself how you figure out how much to invest in advertising dollars. the Investment Analysis is quite simple. Here’s the equation:
Desired ROI is 100%
$25,000 / 1 + 1 = $12,500
Gross Profit / Desired ROI as a Decimal (1 + 1) = Maximum Additional Advertising Investment
25,000 ÷ 2
So, you want to get 100% of your advertising investment back, you will spend $12,500 in new advertising dollars plus make $12,500.
You will Invest $12,500 in additional advertising to realize the Growth Objective of $100,000 in additional revenues that will produce and directly impact your bottom line by an additional $25,000. Cool & achievable based on the above numbers.
The above is an over simplified view, achieving a market share growth of 2.2% on top of the already acquired 10% market share is not easy, the numbers don’t tell the whole story. Now you still have to go through the process of doing the creative, copy, layout and cross promotional stuff but now you an idea in advance the hill or mountain you may have to climb.
I hope this helps you when you get the notion to grab more market share, do your homework and crunch the numbers. You will have a much better picture and it will allow you to enjoy the process of achieving it. Keep this in mind the next time your advertising sales rep wants to up sell you. If you want more real gross profit you will invest to get it, it’s a fact of life. Just make sure it fits your goals, think with the end in mind and work hard to reach it.
Until next Time.
Social Media ROI
The topic of ROI is not a new one but it remains to be a stumbling block for most in the Social Media Marketing field. The problem isn’t that an ROI can’t be derived, the challenge is, most are using old ways & thinking to get to that ROI place in an environment that requires you to think differently. Using old practices does not help you get there because the rules have shifted yet once again.
I got into it with a few people on Twitter over the weekend, @CreativeWisdom @kriscolvin, @mackcollier, @thebrandbuilder and @virtualcfo. We bantered back and forth sharing our views, recognizing we could get there with similar but slightly different metrics. My conversation started with Kris & Mack, we actually started with the Quantity vs Quality of Twitter Followers topic and then we moved onto the ROI question. Then Olivier jumped in along with Leah & Scot. There is a distinct difference between ROI & Impact according to Olivier Blanchard (@thebrandbuilder), his definition is interesting and reasonable I think. He states, eyeballs are not ROI, Impact is not ROI, ROI can’t be calculated with an equation. In one of Olivier’s video’s I was able to relate to him because of my 15 years in Radio & Television, he uses F.R.Y. (Frequency, Reach, Yield) as a way to get to an ROI.
Scot Justice made this statement, “You can capture cost of Social Media by implementing a procedure where every prospect is asked about a blog then Calculate SM$ per impression then ROI”. That is an old school way of tracking and has some merit, we used a similar system in Radio to track campaigns, I would like to hear Kris & Olivier’s perspective on his theory. Talk about a hot topic with some very talented and passionate people, this would make a great panel on Owen Greaves LIVE! (I’m working on it).
I do recommend you visit each one’s website or Blog and see what they are doing and how they are doing it, contact them and ask the questions, I’ve listed them for you:
2.) Kris Colvin
3.) Scot Justice
4.) Mack Collier
5.) Leah Dossey
No they all aren’t Marketers in the traditional form but they do need to understand how obtain a form of ROI. There are many that claim Social Media Expert Status, many think they have a clear understanding of what an ROI is, in my opinion they aren’t and they don’t get ROI.
I’m certain this topic will never really go away because many will have an opinion, many will claim they have the secret formula, the list that do is very, very short. I love this kind of dialogue so I’ll keep bringing it.
Your Passion Is In Front Of You – You're Just Not Paying Attention
There are 30,600,000 (million) references on Google for ” How To Find Your Passion”. Hard to believe there are that many experts on the topic, are you one of them…I’m not. I was thinking about this while taking a shower this morning, I know…I won’t go there. Gary Vaynerchuck said in his address at the BIG Omaha Conference, that he hated the question of, ” How do I find my passion?” the most because he didn’t have a simple answer. Maybe what I’m about to share will help you Gary, it appears to have helped me figure out my passion I’m just getting out of the starting gate. If you think this article is on track please send it to Gary Vaynerchuck and let him know I have found the motherload. 🙂
I had to stop and think for a moment, if we are creatures of habit and we tend to gravitate to things we love like events, books, movies and people, why is it so hard to figure out? I’ll take me for example to help you look at your own desire to find your passion. If you were to look in my home you would get an idea of who I am and what my family likes to do. Since we are talking about me I’ll leave the rest of my family out of it. Let’s start in my office, lets look around a bit, hmmm….lots of tech books, Business Plan Books, IT Strategic Planning, tons of sports (stats) books, Home Business, training books from my Radio & Television days and boxes of all the software I have purchased over the years.
Let’s go down to my rec room, there you will find a set of drums, two guitars…yep I’m a musician (drummer, singer) and so are my two boy’s including there Mom. In our Family room we have very little, it’s the hall of shame, all our wedding pictures and random family pics line the walls, also, the TV, WII, PS2 and the like are in there plus a small book shelf of Christian reading material.
Now you’re probably getting the picture of what I (we) are about, if I was to just use that inventory as a snap shot of what I gravitate to when I’m downtown shopping I would suggest to you I have a passion for Family, Music, Christianity, Technology and Business. As you can see there are a few things I could consider my passion, but the one that gets me more than anything is Technology & Business, it’s the first thing I look for when I’m at a magazine rack or just thinking about business & marketing, how should I position my business (passion). If you were to spend any amount of time with me you would learn that I love people, I love to help others be better than they are. If you could just see how you could be, what you were designed and meant to be, know your role in this EPIC you were born in to, your passion would become obvious.
It’s a simple process I think, but if you look closely at where you spend your time & money, what you like shows up early. Take inventory of what you tend to buy most often, what you spend your time on when relaxing because it interests you, you will most likely find that is the very thing passionate about! Try it on for size and see if you could write about it, talk about it for hours on end on video or just tell it’s story…desire can not be planted in you, you have to find it within yourself and that is the thing Gary says you can monetize. Your passion is in front of you, your just not paying attention.
Please pass this along if you feel it’s of value and leave your comments. Send it to Gary Vaynerchuck to, (I don’t know his e-mail address) I would love help him with his dilemma of answering this question. I’m either on to something here or I’m just plain wrong, you decide.
Many Blessings, Owen
If I Could Do Anything, What Would It Be?
I was asked that question this morning, I hated it because I had stop and take inventory once again. I’m going to share some thoughts with you, I only hope it makes sense and reaches the deepest part of you. I think a great many of us do work or do things we never thought we would have to do to pay the bills. There are times when it feels like the dream left and it isn’t coming back, discouragement is the biggest dream killer I know and it always comes from those who claim to love you.
So, back to the question, If you could do anything, what would it be? If you look back over the years (depending how old you are) try to recall what energized you and brought the most fulfillment and was most meaningful to you. A time and place where you felt this was what you could do for the rest of your life. I know, I know, many times we think we’ve found it and poof it’s gone for whatever reason.
Technology, no…society has changed, business has changed and some of us are struggling to change just so we can make the ends meet, to have some sense peace of what we are doing, then every once and while someone asks the dreaded question. The question that urks me most, If money were taken care of would you do it? DUH! Of course you would!
I have always felt people could be better than they are, get back on track and be in a better place…. why? Because we lost our dream, we lost the thing that made us want to learn new things, seek new challenges, build and create. We bought into the industrial age of JOB, we have been cooked like the frog in water and now we are discouraged, wondering how we got to where we are and thinking, this isn’t what I wanted.
Now that I got that of my chest, what to do? Firstly, write…get everything out, it might take a day or two and maybe even a week but write and figure out what it is, what’s the magnet pulling you, your deep down desire….your dream. I did this and I have recovered my dream….go figure something so simple could work! Now, you need be prepared, this dream will not be easy and you will have trials & tribulations once you have found your vision. You will need people around you that will help you so don’t kid yourself into thinking you can do it by yourself. I encourage you to find likeminded people, people that have a dream and desire to be more than they are, people who want to give something back to thier communities. Without people, there are no successes. God created us as relational beings, that means we need one another to acheive, to grow, to build, to create and to succeed together. Each one of us has a passion or two that makes us get out of bed in the morning, find it and live the life you were meant to live.
So What’s my Dream, what’s the If I could Do Anything, What Would It Be?
Stay tuned and be sure to follow me on Twitter, if you are a small company with less than 10 staff and you are not shy doing Radio & Television (Video), drop me a note.
Many Blessings on you.