Small Business Growth Solutions

Marketing Your Business for SUCCESS Author: International Journal of Pharmaceutical Compounding I find it humorous when an entrepreneur or business owner describes an idea for a new venture to me and then adds the disclaimer, “But I am not really a salesman. I am good at operations, management, and strategy, but I really don’t like to sell.” I want to respond, “Well, maybe you’d better stay where you are and not become an entrepreneur. If you are not willing to learn how to market your business and sell your product/sendee to your customers, then go work for someone else. At the very least, recognize the critical nature of marketing and hire a professional to do it on a regular basis.”

In the last issue, I outlined and described the four elements of the business concept. To refresh your memory, they are (1) product/service, (2) target customer, (3) value proposition (competitive advantage in the market), and (4) value chain (how you deliver your product/service to the customer).1 Marketing strategy is derived mostly from knowledge of a target customer and a value proposition. Jeff Wuorio recently published an article titled, Top 10 Reasons Businesses Fail.2 Among them was the lack of a competitive edge and something he described as “mushy marketing.”2 The two are directly related; one is the message and the other is how the message is delivered. Either way, if you fail at one or the other, your business will probably fail. Conversely, if you acquire a strong knowledge of your target customer, determine the factors that most influence his buying decisions, and tell him that your business is responsive to those factors, you will be presented with an opportunity to succeed. The opportunity is in the form of driving customers to your pharmacy; after that, your execution will have to take over. You have got to deliver on the promise you made in your marketing message. Execution, however, is another article.

Tom Peters, in his book Thriving on Chaos, reminded entrepreneurs and business owners of a very important adage about differentiating their product or service.3 He said, “Don’t forget that it is not differentiated until the customer understands the difference.”3 Just creating a competitive advantage in the marketplace, while critical, is not enough. Marketing is a multipronged attack, made up precisely of what to say, whom to say it to, and how to reach them. Any knowledge one seeks about the fundamentals of marketing also must include the realization that success is directly proportionate to one’s knowledge of the customer. Without a keen understanding of both, the search is hopeless.

Direct Marketing

How to Use the 3 Most Common Direct Marketing Measurements to Increase Your Profits!

John Wanamaker, a 19th century entrepreneur, once famously made the statement, “I know that half of my advertising is wasted, I just don’t know which half.” Fortunately for today’s marketers, there are scientific ways to determine which half is wasted, and which half is not, through the use of common direct marketing measurements.

Advertising is, and has always been, part art and part science. With direct marketing, the science part takes center stage as there are common direct marketing measurements that can be utilized to verify the results of the advertising.

With the increased popularity of direct marketing, the success of advertising can be measured through a variety of common direct marketing methods such as cost per acquisition, cost per piece, and response rate.

Before continuing in describing these common direct marketing measurements in detail, it is beneficial to review one of the direct marketing tools needed to determine the success of the mailing. The most important direct marketing tool is the response mechanism. This is how you can gauge the success, or lack of success, of a direct mail campaign. This is the mechanism by which the prospect will use to respond - it may be a postcard to request more information, an 800 number to call, or a website address to place an order. You can than utilize this response to determine the success of the direct mailing.

The first of the most common direct marketing measurements is the cost per acquisition. The cost per acquisition can be determined by taking the total cost of the mailing and dividing it by the number of responses. For example, let’s say the total cost of a mailing is $2,000 and 20 people respond. The cost per acquisition is $100. This is an important tool to find out if the cost to obtain a new customer is in line with the profits that you will receive.

The second of the most common direct marketing measurements is the cost per piece. To find the cost per piece, you would take the total cost of the mailing and divide it by the total number of pieces sent. For example, if the total cost of the mailing was $4,500 and you sent 2000 direct mail pieces, the cost per piece would be $2.25. This is an important figure to keep in mind, because by lowering the cost per piece (as long as the number of responses stays the same), you can lower the cost per acquisition.

The third of the most common direct marketing measurements is the response rate. The response rate can be calculated by taking the number of people that responded and dividing it by the number of people that were sent the direct mail package. For example, if 2000 people were mailed a direct mail package and 20 people responded, the response rate would be 1%. This is an important tool that you can utilize to forecast the success of future mailings.

By using all three of these common direct marketing measurements, you can finally determine which half of your marketing is working, and which half is not.

Daegan Smith is the Ex-NCAA Wrestler Turned Webmaster of http://www.perfect-home-based-business-opportunities.com ” Perfect Home Based Business Opportunities - The Internet’s Top Home Based Business Opportunities Free Information Resource!