Archive for July, 2008
Good Design, like pornography, may be hard to define, but you know it when you see it. Usually. Although the way something looks (appearance) figures prominently in virtually every form of design, what you see may not be all you get. When things that look great are hard to use or don’t perform well, some might claim that’s because you’re not reading the directions. We say it’s bad design.
This is not to discredit either the ‘value of appearance’ nor the ‘appearance of value.’ First impressions are important to assessing the actual value of something. But, beyond appearance is the broader concept of perception. Seen more broadly, Good Design focuses on all the dimensions that impact the perception of value, in addition to the appearance of value.
Dimensions of POV
Design is a process of improving the Perception of Value of products and services by focusing on three dimensions or ‘drivers’ of value:
• What is Desirable, the attributes such as the emotional connection, features, function, appearance or level of innovation that prompt people to buy a product or service and in the best circumstances, make a product or service ‘irresistible.’
• What is Useful, the attributes that satisfy a need or problem and can be manufactured at a reasonable cost.
• What is Usable, the attributes that make a product or service easy to use or experience reliably and is appropriate to the conditions under which it’s used or experienced.
Perceived Value defines what a product or service is ‘worth,’ and is therefore the principal determinate in what people will pay for it. This can work in both positive and negative ways for a company who provides the offering. When prospects or customers perceive that products and services are worth less than they actually cost to make or deliver, they can only be sold for a ‘loss,’ a very bad business proposition and the antithesis of good design. Conversely, those attributes that increase perceived value or ‘worth,’ allow offerings to be sold for more, sometimes considerably more, than they cost to produce or deliver, which translates into profit or ‘return’ on the investment. Profit is derived from the value added to cost and therefore makes Design the ultimate determinate of profitability.
Dan Droz is Chairman and CEO of Droz & Associates: Marketing, Branding, Design, Public Relations, Advertising, Web Design, Interactive Marketing for Pittsburgh and surrounding regions.
Friday, July 18th, 2008
Advertising, Branding, Design, Marketing, Pittsburgh, Sales No Comments
The Goal of Promotion is Action
Although we are not opposed to cold calling or canvassing, the ultimate goal of an effective prospect marketing program is to make it easy for the prospect to take the action to contact you and show their interest. For example, one of our clients is a real estate broker. We were asked to review his ads in the real estate sections of the local newspapers. I asked him what he was trying to accomplish with his ads and he told me quite sincerely, “To sell houses.”
I suppose he was partly right: ultimately, the ad was part of the process to sell a house. But the real purpose of the ad was NOT to sell a house. No one sees a four-line listing and buys a house. The objective of each listing was to generate a phone call. I’ve never known anyone to see a listing for a house in a newspaper and send a down payment. They see the ad and - if it works - they pick up the phone.
So Rule number one: The goal of prospecting is generally not to sell the product. The objective is to generate a response, to get someone to take some action.
Getting Prospects to Take Action
Direct Prospecting is one of the most challenging forms of marketing for an important reason: Prospects have choices, and often a lot of them. No matter what business you’re in, and no matter how special you think you are, your future customers don’t really think about you. If you weren’t there, they’d be going somewhere else to fulfill their need. In your mind, that choice might not be as good as yours, but for them, it just might be. So, given that your future customers have a lot of choices, how do you help your prospects take action to contact you.
The simple answer to the question is What You Sell Them Depends on what you tell them. Whether it’s in the form of an ad, announcement, brochure, outbound email, direct mail letter, a post card identifying your booth at a trade show or the trade show booth itself. What you say and how you say it is what is going to have impact.
There are four elements to an effective message that prompts action:
1. AIDA. (Attention, Interest, Desire, Action) or IEEO (Interrupt, Engage, Educate, Offer)
To have impact, what you say needs to:
• gets people to pay attention or interrupt their passive inattention,
• become very interested or engaged in what you’re selling
• create genuine desire by educating them
• take action through an offer.
2. USP (Unique Selling Proposition): Building a Case for Your Product or Service that positions you as an expert and source of solutions to a problem they have.
3. WIIFM (What’s In It For Me). Create relevance by framing what you’re selling as a solution to a problem they have.
4. GTOYML (Get Them On Your Mailing List). Create vehicles for getting their address.
Dan Droz is Chairman and CEO of Droz & Associates: Marketing, Branding, Design, Public Relations, Advertising, Web Design, Interactive Marketing for Pittsburgh and surrounding regions.
Thursday, July 17th, 2008
Advertising, Marketing, Pittsburgh, Sales No Comments
A “pipeline” is a flow of increasingly qualified prospects that move successively from one level of qualification to the next, developing increased interest, loyalty and commitment at each stage. In this sense, business development is a process of both getting a customer, then leveraging the relationship to increase the frequency and size of each purchase and enlist the customer to drive even more customers to your business.
Many companies don’t view existing clients/customers as a primary target for generating new business. Yet, they are the least expensive prospects to impact, because you have ready access to them, you know them and have more information about how to sell them. The goal of developing existing customers is to create greater ‘customer share,’ ie, greater lifetime value from a unique customer, by increasing both the frequency and size of each purchase.
For example, a retailer can be successful at attracting a customer, but without a strategy for motivating them to return or buy more, they’re not really leveraging the customer opportunity. Here are some ways to increase purchase frequency and size:
1. Frequency Programs
The most powerful promotional program for existing customers is a frequency program. You’re familiar with frequency programs from the frequent flyer programs or punch cards for repeated use that you get at a variety of retail establishments. Sheetz has a six item punch card, Subway has a 10 stamps.
2. Return Visit Promotion
Another form of frequency program is a one time offer. For example, a return visit program for a restaurant. At the end of every meal, the customer is given an envelope with a date stamp. The envelope contains one of several offers: a free dessert, appetizer, or main course with purchase of another main course. If they return within 30 days, they open the envelope and definitely win something.
3. Plateau Programs
Here, customers get added benefits when they purchase a higher volume of product, or reach a certain “plateau.” Sometimes this can be a gift with purchase, or often takes the form of free shipping if a certain volume plateau is reached. Or it can also apply to distributors that may offer a higher discount for volume purchase or additional benefits if a customer reaches a certain level of volume.
4. Continuity Programs
Fruit-of-the-month club, subscriptions and collector programs are all continuity programs, based on the premise that you provide a continuous supply of a product or service, over time. A service agreement can be an excellent continuity program for companies that have products that need to be serviced.
5. Customer information cards
Without an address, you can lose contact with a customer. You’ve got to get a customer’s mailing information to be able to have ongoing contact with them. If someone comes to your store, restaurant or buys something and you have no record of how to reach them, an important opportunity is lost. This can be done in a variety of ways. If you explain to customers that you have a variety of specials that you’d like to alert them about, many will be happy to fill out cards. Sweepstakes are good ways to generate mailing lists. One final form of information is the use of customer information cards. If, for example you make a product that is distributed by others, sometimes it’s hard to have direct contact with the end user. Warranty cards are an excellent way to build your data base to be able to have contact with an end user and get valuable information about preferences on that customer, that can be channeled back through your distribution network, or used for direct contact to incentivize future purchases.
Dan Droz is Chairman and CEO of Droz & Associates: Marketing, Branding, Design, Public Relations, Advertising, Web Design, Interactive Marketing for Pittsburgh and surrounding regions.
Thursday, July 10th, 2008
Marketing, Pittsburgh, Public Relations, Sales No Comments
Some small businesses, attempt to compete by being lower priced. If you’ve figured out a way to produce or deliver a product for substantially less than a competitor, kudos to you. But, usually, it’s only the large businesses that already have the volume to create efficiencies of scale and buying power that can offer lower price. And, it’s not due to lower margin. It’s due to reduction in operating cost and the cost of goods sold.
It’s important not to confuse operational efficiency with margin deficiency. If your lower price is due to either a reduction in your profit margin, or you’re cutting your marketing investment to conserve cost, you are actually compromising your competitive position, not enhancing it.
When you reduce your margin or marketing budget in order to lower your price, you are effectively using price reduction as a marketing strategy with several negative effects:
• You lower the perceived value of your product or service.
• You lower your profit, in most cases much faster than you increase volume
• You dramatically increase your marketing budget by substantially more than the decrease in price.
• And, with all the money spent on price reduction, there’s no money left to invest in real marketing.
I talk to a lot of people who don’t have a marketing budget. The reason is that they don’t have enough profit margin to support the marketing budget. The fact of the matter is that they have a huge marketing budget. It’s just in the form of price reduction.
Dan Droz is Chairman and CEO of Droz & Associates: Marketing, Branding, Design, Public Relations, Advertising, Web Design, Interactive Marketing for Pittsburgh and surrounding regions.
Tuesday, July 8th, 2008
Advertising, Interactive Marketing, Marketing, Pittsburgh, Public Relations, Sales 1 Comment
A ’service product’ may seem like an oxymoron, because, by definition, services aren’t tangible. However, it is possible to frame intangible services as concrete deliverables by incorporating some of the following steps:
1. Understanding the problem your service solves. This is the most fundamental rule in marketing, sales and branding. Services become more tangible when they are perceived to be solutions to a particular problem. “Carpet cleaning” is a service. “Spot Removal” is a solution with a tangible outcome. It ultimately drives your message, your brand loyalty and the promises you make. Further, it allows you to calibrate your success against criteria based on the degree to which you solve the problem.
2. Define one or more outcomes. Solving a problem should have an outcome or tangible result. Golf lessons are a service. Lower handicaps are an outcome.
3. Create a name or identity that corresponds to the need, want or solution and communicates the outcome. In the above examples, giving a “Spot Removal” process a distinctive brand identity such as SpotGo or SpotAway captures both the benefit and provides an opportunity to brand the service. A process for lowering handicaps might be called “ScoreBetter” or “The ProScore” System.
4. Keep it simple. Processes and services can be complex. It’s one of the reasons they are sometimes hard to describe. For example, by breaking down a complex process, into a series of 5 steps, you make a process or service appear simpler to understand.
5. Iterate. Iteration is the process of moving toward a “best practice.” Because products have defined features, you can continue to refine them. Product development, is not an event, it is a process and because it is a repeatable act, requires attention to the way(s) people respond to it. It’s a process of continuous improvement toward a best practice.
Dan Droz is Chairman and CEO of Droz & Associates: Marketing, Branding, Design, Public Relations, Advertising, Web Design, Interactive Marketing for Pittsburgh and surrounding regions.
Thursday, July 3rd, 2008
Advertising, Branding, Marketing, Pittsburgh, Public Relations, Sales No Comments