Monthly Archives: September 2016

Simple Way to Connect With the Affluent Customers

When it comes to connecting with your target market, here’s the winning formula:

1. Decide exactly who you want as a customer—notably, deciding on the level of income, net worth, overall affluence, lifestyle and ambitions, aspirations, interests, and attitudes about spending you want them to have.

2. Be sure you’ve crafted products, services, a business, its positioning—everything—for that consumer.

3. Go to those consumers where they are.

That third point is succinct, but it’s often far beyond most business owners’ comprehension. Most business owners act as if they’re trees with deep roots, at the mercy of whatever favorable or unfavorable environment exists and evolves around them. But today, consumers, especially affluent consumers, can be found, identified, effectively communicated with, attracted, and sold to at any distance, near or far.

The fact is, the more affluent the customer, the less concerned with convenience and the more they’re willing to conduct business at a distance, import from afar, or travel to places in order to get exactly what they want and what they believe to be the best of a category.

A lot of people ask me about finding the affluent, as if they were all residing in secret, undisclosed locations. Actually, privacy in America and many other places in the world is dead. We not only know where they live but also what they’ve been buying.

For starters, there are people who’ve already gone to a great deal of trouble to spy on them, dig up data on them, monitor their buying behavior, and compile lists of them sorted by their interests and passions, by their level of affluence, by the frequency of their spending in a category, as well as by gender, age, ethnicity, marital status, home ownership, income ZIP code, and a myriad of other divisions. In mailing list lingo, these are called selects. The world of mailing lists commercially available for rent is an amazing place. You can pretty much find any kind of group of desired prospects, then drill down closer and closer to your ideal prospects within the group by these selects.

When you pass through the gateway to the mailing list world, you’ll discover that tens of thousands of mail-order, retail, service, credit card, publishing, and other companies have all their lists of past and present customers, cardholders, and subscribers as well as their prospects or inquiries available for rent.

For better understanding, let’s work our way through a hypothetical example.

Let’s assume you own a very upscale French restaurant with a good wine cellar, snooty waiters, and high prices—and you wish to go in search of affluent new customers. This happens to be an easy one, which is why I picked it. There are hundreds of list choices. For example, there’s a compiled list of yacht and private plane owners, available by state or county. There are 213,090 prospects on the list. On that list, within a 45-minute driving radius of your restaurant in Beachwood, Ohio, there will be only a small number. Let’s assume there are only 200 of them. Those 200 names may be very valuable. We know to create and send them a mailing with planes and boats on the envelope, and maybe a line of copy like “Free Voucher for the Adventure Trip of a Lifetime Enclosed.” Inside, we can tell them we know they appreciate the finer things in life, appreciate new experiences, and often fly their own plane or sail their own yacht in search of them. But did they know they could take a trip to one of the finest restaurants in all of France, only a short drive from their own home?

There’s also a list available of people in any ZIP code of your choice, arranged by birthday. So, in every month, there are quite a few people in reach of your restaurant having a birthday, and most people go out to dinner to celebrate. From that list, you can select only married people or people who own homes in pricey neighborhoods or people with certain incomes. A colleague of mine operates a company that does these “Happy Birthday” mailings for restaurants and consistently gets tremendous response and very good return on investment.

Or we could get very sophisticated and merge or purge. That means taking only the names appearing on two or more lists. The duplicates. The yacht and plane owners’ list giving us only 200 names in our area might thin out to only 10 to 20 birthday names in any given month. But they’re the quadruple-perfect prospects. So instead of sending them a birthday card or letter and a coupon for a free birthday dinner, we might send them a beautifully wrapped gift box, a copy of our menu, and a fancy certificate on parchment paper. Doing this, we would spend a lot more per prospect, but we’d be spending all our money on ideal prospects.

Here’s the point: If you can describe your ideal affluent customers—whether ultra-affluent, affluent, mass-affluent, young, old, male, female, and so on—you can go into the inventory of available lists and find them, already rounded up for you. In all cases, you can get their physical addresses. In many cases, you can also get their phone numbers and email addresses.

One way or another, from one or multiple databases, it’s possible for all marketers to obtain and develop a hit list of ideal prospects. You can drill down with incredible specificity to identify and reach out only to people perfectly, precisely, and multi data-point matched with your current customer, ideal customer, or product or service offer. And you should.

5 Strategies To Escalate Revenue and Growth

Success is dependent on growth, and while we all strive for success, many entrepreneurs experience very little growth in their business.

With the right strategies and plan, revenue and growth can be escalated. Here are five tips that can help you scale your business.

1. Identify your unique selling point and run wide open with it. Your unique selling point is what makes your product or service different from your top competitors. Do you have a lower cost? Do you offer a higher quality product? What do you offer that your direct competitors do not?

Once you identify your USP, use it to your advantage. Make it the focal point of your marketing efforts and make sure your target customer is aware of what makes your product or service superior.

2. Tap into additional revenue sources using your existing customer base. Many businesses will focus solely on new customer acquisition and forget that they have an existing customer base that they can tap into and utilize. Creating an effective customer loyalty program, establishing a customer referral program, or launching an affiliate program are all ways to leverage your current customer base to produce additional revenue.

Examples include Groupon launching a partner network that rewards 10 percent of all deals purchased, and Starbucks’ loyalty program that resulted in a 26 percent rise in profit and 11 percent jump in total revenue.

3. Work out all kinks before thinking of expanding. As entrepreneurs, we all have a “bigger picture” that we are shooting for, but it is important that you don’t put the cart before the horse, especially when it comes to expansion. Opening new locations and entering new markets sounds great and can potentially equal huge growth, but if you do it prematurely it can result in a complete failure.

Make sure there are no holes in your business before thinking of expanding. Creating a winner and then duplicating it in additional markets or locations is easier than rushing the expansion when you have multiple holes in the business. Remember, even the smallest hole can sink the largest ship.

4. Don’t be afraid to get dirty. Have you ever noticed a trend among failing businesses? The owner is usually MIA and not hands on. Many entrepreneurs think that having owner, founder or CEO on their business cards means it is time to sit back, kick their feet up on the desk, and bark orders.

When I started Market Domination Media I was working the phones, speaking to prospects and doing client follow-up. I still do those things to this day, and it is something I will always continue to do. There is nobody in your company that knows your product or service better than you.

For your business to grow, you must lead the way for your team. Jump in the trenches and get dirty with them. Show them how it is done, and you will not only gain respect, but you will also gain a more productive and motivated team.

5. Reinvest back into your business. Growth requires capital, so the exuberant salaries and lavish company spending will have to be put on hold to reinvest the revenue back into the business.

Companies will often seek funding and run it dry because they were supporting large salaries and unnecessary spending, only to attempt to secure more funding to pull them out of the hole they dug. Be frugal and concentrate on reinvesting every dollar back into your growth.

Some Fast Ideas to Rapidly Grow Your Revenue

There exists only one unbreakable rule for entrepreneurial growth: Get revenue!

That’s it. There are a thousand tasks that compete for your attention every day, but raising revenue must always remain at the top of your list.

You cannot fund your business on hard work alone. You cannot pay your bills with optimism. You either raise revenue or your business dies.

So how does the average entrepreneur continue feeding the revenue beast? Here are four fast ideas for rapid revenue growth that I’ve identified inside my own company for the upcoming quarter:

1. Leverage your existing fan base. Your best and most reliable source of revenue comes from your fan base. They already love and trust you. Now is the time to add new value for them to raise new revenue.

Start by asking the question, “What would add so much value so quickly that our existing customers would pay well to receive it?”

Is it a new service that supports something you have sold before? Is it an improved version of a previous product or service? Maybe it is an entirely new line that you can rush to market.

The key is to leverage existing buyer relationships. In doing so, you gain a shorter buying cycle, a higher conversion rate and more rapid revenue growth.

2. Host a seminar. Are you truly leveraging your expertise, or do you hold it back for a select few clients? Now, is this “hold back” increasing your revenue? Maybe … maybe not.

I know this is out of the box for many people, but if you have expertise that people can immediately benefit from, consider an open invitation, half-day educational seminar. There are countless resources online (and in bookstores) that describe how to create, promote and deliver seminars (or webinars).

Do the math: Find 200 people willing to pay $100 each and you just grew revenue by $20,000. Layer in product sales, consulting contracts and sponsorships, and pretty soon that rapid revenue growth begins looking quite impressive.

The key is coming up with a killer idea that appeals to the broadest audience possible. What is your specialty? How do you define the power of your message? What do you have to say to the world?

Figure it out and hold on for the ride!

(Author’s credibility note: I’m doing 11 such events in the fourth quarter this year.)

3. Cross-promote to new audiences. Are you promoting exclusively to your own audience? Big mistake! Go find someone (or many “someones”) with a larger audience and offer your product to the people in their database. (You will have to share the revenue, of course).

If you ever receive an email from a prominent expert endorsing the product or service of “my very good friend,” you are likely reading a cross-promotional sales opportunity.

The good news is that you can reach an entirely new audience. And when you sell to them once, you increase your chances of selling to them again in the future. Recurring revenue at it’s finest!

4. Repurpose an existing product. Do you blog? Assemble your very best blog posts into an ebook and sell it online. Do you have inventory lying around? Repackage it and combine it with something else so that you can promote it as something new. Consider expanding a service you offer or launching a unique sales promotion to clear out stale inventory.

The key is looking at your products and services in an entirely new way. Find a new perspective on an existing product and ask how it can generate revenue right now. As long as your product adds value to the customer, you can keep selling it over and over again.
So, are you working with a revenue-first mindset right now?

Steps to Better Manage Your Cash Flow

Cash is king when it comes to the financial management of a growing company. The lag between the time you have to pay your suppliers and employees and the time you collect from your customers is the problem, and the solution is cash flow management. At its simplest, cash flow management means delaying outlays of cash as long as possible while encouraging anyone who owes you money to pay it as rapidly as possible.

Measuring Cash Flow
Prepare cash flow projections for next year, next quarter and, if you’re on shaky ground, next week. An accurate cash flow projection can alert you to trouble well before it strikes.

Understand that cash flow plans are not glimpses into the future. They’re educated guesses that balance a number of factors, including your customers’ payment histories, your own thoroughness at identifying upcoming expenditures, and your vendors’ patience. Watch out for assuming without justification that receivables will continue coming in at the same rate they have recently, that payables can be extended as far as they have in the past, that you have included expenses such as capital improvements, loan interest and principal payments, and that you have accounted for seasonal sales fluctuations.

Start your cash flow projection by adding cash on hand at the beginning of the period with other cash to be received from various sources. In the process, you will wind up gathering information from salespeople, service representatives, collections, credit workers and your finance department. In all cases, you’ll be asking the same question: How much cash in the form of customer payments, interest earnings, service fees, partial collections of bad debts, and other sources are we going to get in, and when?

The second part of making accurate cash flow projections is detailed knowledge of amounts and dates of upcoming cash outlays. That means not only knowing when each penny will be spent, but on what. Have a line item on your projection for every significant outlay, including rent, inventory (when purchased for cash), salaries and wages, sales and other taxes withheld or payable, benefits paid, equipment purchased for cash, professional fees, utilities, office supplies, debt payments, advertising, vehicle and equipment maintenance and fuel, and cash dividends.

“As difficult as it is for a business owner to prepare projections, it’s one of the most important things one can do,” says accountant Steve Mayer. “Projections rank next to business plans and mission statements among things a business must do to plan for the future.”

Improving Receivables
If you got paid for sales the instant you made them, you would never have a cash flow problem. Unfortunately, that doesn’t happen, but you can still improve your cash flow by managing your receivables. The basic idea is to improve the speed with which you turn materials and supplies into products, inventory into receivables, and receivables into cash. Here are specific techniques for doing this:

– Offer discounts to customers who pay their bills rapidly.
– Ask customers to make deposit payments at the time orders are taken.
– Require credit checks on all new noncash customers.
– Get rid of old, outdated inventory for whatever you can get.
– Issue invoices promptly and follow up immediately if payments are slow in coming.
– Track accounts receivable to identify and avoid slow-paying customers. Instituting a policy of cash on delivery (c.o.d.) is an alternative to refusing to do business with slow-paying customers.

Managing Payables
Top-line sales growth can conceal a lot of problems-sometimes too well. When you are managing a growing company, you have to watch expenses carefully. Don’t be lulled into complacency by simply expanding sales. Any time and any place you see expenses growing faster than sales, examine costs carefully to find places to cut or control them. Here are some more tips for using cash wisely:

– Take full advantage of creditor payment terms. If a payment is due in 30 days, don’t pay it in 15 days.
– Use electronic funds transfer to make payments on the last day they are due. You will remain current with suppliers while retaining use of your funds as long as possible.
– Communicate with your suppliers so they know your financial situation. If you ever need to delay a payment, you’ll need their trust and understanding.
– Carefully consider vendors’ offers of discounts for earlier payments. These can amount to expensive loans to your suppliers, or they may provide you with a change to reduce overall costs. The devil is in the details.
– Don’t always focus on the lowest price when choosing suppliers. Sometimes more flexible payment terms can improve your cash flow more than a bargain-basement price.

Surviving Shortfalls
Sooner or later, you will foresee or find yourself in a situation where you lack the cash to pay your bills. This doesn’t mean you’re a failure as a businessperson-you’re a normal entrepreneur who can’t perfectly predict the future. And there are normal, everyday business practices that can help you manage the shortfall.

The key to managing cash shortfalls is to become aware of the problem as early and as accurately as possible. Banks are wary of borrowers who have to have money today. They’d much prefer lending to you before you need it, preferably months before. When the reason you are caught short is that you failed to plan, a banker is not going to be very interested in helping you out.

If you assume from the beginning that you will someday be short on cash, you can arrange for a line of credit at your bank. This allows you to borrow money up to a preset limit any time you need it. Since it’s far easier to borrow when you don’t need it, arranging a credit line before you are short is vital.

If bankers won’t help, turn next to your suppliers. These people are more interested in keeping you going than a banker, and they probably know more about your business. You can often get extended terms from suppliers that amount to a hefty, low-cost loan just by asking. That’s especially true if you’ve been a good customer in the past and kept them informed about your financial situation.

Consider using factors. These are financial service businesses that can pay you today for receivables you may not otherwise be able to collect on for weeks or months. You’ll receive as much as 15 percent less than you would otherwise, since factors demand a discount, but you’ll eliminate the hassle of collecting and be able to fund current operations without borrowing.

Ask your best customers to accelerate payments. Explain the situation and, if necessary, offer a discount of a percentage point or two off the bill. You should also go after your worst customers-those whose invoices are more than 90 days past due. Offer them a steeper discount if they pay today.

You may be able to raise cash by selling and leasing back assets such as machinery, equipment, computers, phone systems and even office furniture. Leasing companies may be willing to perform the transactions. It’s not cheap, however, and you could lose your assets if you miss lease payments.

Choose the bills you’ll pay carefully. Don’t just pay the smallest ones and let the rest slide. Make payroll first-unpaid employees will soon be ex-employees. Pay crucial suppliers next. Ask the rest if you can skip a payment or make a partial payment.