8 Strategies When Sales Drop and Costs Cut into Your Profits

 

If your sales are down and costs are hurting your profits, you’re certainly not alone. This is still not a good economy.

Gas prices are hurting business and consumers in many states. The drought has hurt corn production. Prices for peanut butter and coffee have increased. Airlines are adding seats to cut legroom for passengers. Sales are down in some home improvement at major retailers.

So challenges exist everywhere, not just with you. The irony is you can do something about it.

Here are eight strategies:

1. Turn the problem into an advantage. Consider making a bigger product and charging a higher price. If you have products with good margins, use them as loss leaders to entice customers to buy your other products.
2. Use traditional tactics. Determine your break-even point. Reduce the size of your product, if you think your customers won’t care. Your customers might notice but many will still probably buy to avoid paying higher prices.
3. Recycle and reuse. Look for more ways to save money in your operations. Plan better delivery routes to use less gas. Avoid upgrading software. Purchase pre-owned products. Partner with your employees and incentivize them to come up with money-saving/money-making ideas.
4. Negotiate. Business relationships are important. But if you can’t afford your vendors’ prices, try negotiating.
5. Change your vendors. If your vendors aren’t willing to negotiate, look for others with which to do business.
6. Close the office and go home. Work from your home. More and more businesspeople are using technology to telecommute. Talk with your CPA. You’ll avoid paying office rent, and you’ll be able to take a write0ff at tax time if you dedicate space for business.
7. Increase your prices. Hopefully, your branding is strong, and your customer satisfaction ranks high. Warn your customers and explain why you must increase prices, and express empathy and appreciation for their business. Provide more added-value – if it doesn’t hurt your bottom line any further. Fine tune your customer service
8. Expand marketing economically. Bone up on social media, get more opportunities as a guest speaker, find strategic alliances for cross-promotion, write press releases and discuss possible trade-out opportunities with the media. Radio stations are known to give free advertising in exchange for products and services.

If all else fails and you really feel you can’t raise prices – then don’t. Just accept your situation and keep on truckin’.

From the Coach’s Corner, actually, you can find countless strategies on this business portal in the Finance and Marketing/Sales categories.

“The worst crime against working people is a company which fails to operate at a profit.”
-Samuel Gompers

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry. 

Best Buy’s Lessons from Trying to Sell at the Cheapest Price

 

Updated Oct. 14, 2012

Best Buy is a troubled company. Some of it’s challenges stem from unfair Internet competition, and it feels compelled to match the prices of online competitors in this year’s holiday selling season. That’s not good for a company that has brick-and-mortar sales expenses.

But in other ways, the company has caused its own problems.

Best Buy’s net income fell 90 percent in the second quarter, and has a new CEO. The old CEO resigned his position and left the board in the wake of the discounter’s financial problems. Then, he engineered a plan to buy Best Buy, but to no avail.

You might recall earlier year Best Buy tried to lower its expenses by $800 million by 2015 in closing 50 of its superstores and by laying off 400 employees. Instead, it will focus on 100 new smaller stores to sell mobile products.

“In order to help make technology work for every one of our customers and transform our business as the consumer electronics industry continues to evolve, we are taking major actions to improve our operating performance,” said Brian J. Dunn, CEO of Best Buy, in announcing the cutbacks before he resigned.

“As part of our multi-channel strategy, we intend to strengthen our portfolio of store formats and footprints – closing some big box stores, modifying others to our enhanced Connected Store format, and adding Best Buy Mobile stand-alone locations – all to provide a better shopping environment for our customers across multiple channels while increasing points of presence, and to improve performance and profitability,” he added.

Whew, that’s a mouthful. It appears to be an attempt to create a smokescreen about its business-model issues. 

True, Best Buy has been hurt somewhat by the Internet, especially Amazon.com. The consumer practice of “showrooming” has been devastating. Consumers visit retailers like Best Buy to check out products, but then go online to buy at the cheapest price.

Best Buy is also hurt by the manufacturers. If you buy a product at Best Buy and register a purchase, you’ll be inundated via e-mail by the manufacturer. It seems almost daily – manufacturers the likes of Lenovo and Hewlett-Packard are trying to sell products to consumers directly. 

However, most purchasers want a test drive before they buy a new tech product. Though not known for selling the newest products, Costco makes it work by creating trust with great customer-service policies. Costco also has a better clientele — small businesspeople and high net-worth shoppers. Most are unlikely to pull the showrooming nonsense.

Poor business model

Historically, no company has ever been profitable solely by trying to sell electronics products at the lowest price. It simply isn’t a viable business model. Actually, it doesn’t work in any sector.

For a sustainable business model, customers have to perceive sufficient value.

When shoppers enter Best Buy stores, they perceive that too many employees only want to sell products, and not provide a service.  But Best Buy really needs to invigorate sales with 11 customer retention, referral strategies. 

Further from my perspective in the Pacific Northwest, here are my observations after shopping at Best Buy stores: 

1. Failure to deliver with mediocre prices
2. Poorly dressed salespeople
3. Inconsistent product knowledge among salespeople, and some knew less than I did
4. Some salespeople were condescending and rude (in particular – Springfield, OR)

Clearly, customer service and sales training are in order. The latter three reasons are enough to drive customers elsewhere. It’s important to get strong results from an HR training investment.

Also, it’s important to understand why people will buy from you – remember it’s always an emotional decision.

Admittedly, about 18 percent of customers – blue-collar and professionals, alike – will only buy if you’re selling at the cheapest price in the marketplace. That’s also helped cause the annoying consumer practice of showrooming.

Assuming you’re selling products of value, avoid those people. They are the most troublesome.

Even if they buy, they’re more likely to show up the next day demanding to return their purchase. Even if they keep the purchase, they complain the loudest and longest.

Focus on people who are motivated by price and value.

For them, here are the five value perceptions of what your customers sub-consciously think in motivating them to buy from you:

Employees, Spokespersons – 52 percent. The key characteristics are integrity, judgment, friendliness and knowledge. Remember, about 70 percent of your customers will buy elsewhere because they feel they’re being taken for granted by your employees. And customers normally will not tell you why they switched to your competitor.

Image of Company – 15 percent. They are concerned about the image of your company in the community. Cause-related marketing is a big plus in forging a positive image. So is cleanliness and good organization.

Quality of Product or Service Utility – 13 percent. The customer is asking the question – “What will this do for me?”

Convenience –12 percent. Customers like easy accessibility to do business with you. That includes your Web site, telephoning you, and the convenience of patronizing your business.

Price – 8 percent. Price is important, but it’s the least concern among the five value-motivating perceptions. Use the eight simple strategies to give you pricing power.

From the Coach’s Corner, here are three salient resource links about sales and profit:

• Do You Know What Drives Your Profit?
• Profits: How to Save on Sales Opportunity Costs
• The Seven Steps to Higher Sales
• 11 Sales Strategies to Outsell Your Big Competitors

“Where you start is not as important as where you finish.”

-Zig Ziglar

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

Do You Want to Be a Ninja Innovator? Here’s How…

 

Every company wants to be successful in this worldwide downturn. But to achieve lofty goals, certainly innovation is the key in our new economy.

To become an innovative leader and to participate in turbo-charging the economy, it’s vital to continually evaluating your organization and strategizing for success. It takes involvement by members of your entire operation, and in most cases cultivating a new culture.

That means identifying your company’s assets, processes, resources and skills.

In a nutshell, here are the main points to consider in your analysis:

Human Resources – Completely review your capabilities in human resources with a focus on your competencies and weaknesses. Determine your abilities to achieve a competitive advantage.

Consider your recruitment process, training and development, and compensation systems.

Assess the strengths and weaknesses of your organizational culture, especially your leadership capabilities.

Products and services – Evaluate your offerings in terms of breadth and mix, quality and reliability.

Marketing – Take a hard look at your image, research, development, distribution channels, brand equity, sales personnel, customer-service quotient and market share.

Query your customers. What are their viewpoints? Evaluate your customer base to see if they meet your goals for growth.

Examine your potential marketplace with a focus on socio-culture – demographic trends and tastes, economic trends from interest rates to inflation.

Operations – Evaluate your productivity, quality controls, facilities, supply chain, technology, information systems, and management strengths and weaknesses.

Financial performance – Keep an eye on profitability. Forecast your revenue growth. Assess your asset utilization, debt-leverage position, liquidity and equity position.

Competition – Compare the missions, strategies, and competitive advantages of the competitors? 

Following your analysis, there are six steps to take. 

Here’s a checklist: 

1. Using your analysis, develop a big-picture strategic action plan.
2. Make sure you have a comprehensive human resources program that encourages collaboration among teams. That means maximum delegation, empowerment, training and succession planning.
3. Encourage blue sky planning sessions.
4. Continually evolve. Leverage the insights of your devil advocates with an eye on your company’s potential. Ask the right open-ended questions for optimal creativity.
5. Practice the “Principle of Contrary Action.” To learn how to keep an open mind, keep a mental note of all your activities but use a different approach each time. For example, even when driving to the neighborhood store, take a different route to-and-from each trip and alter your shopping habits inside the store. Dare to be bold. Consider all alternatives.
6. Keep chipping away.

From the Coach’s Corner, here are related resource links:

• Developing Trends, and Solutions for Manufacturing Success
• Study: Why Lean Manufacturing Principles Often Don’t Work
• Link between Financial Performance and Succession Planning
• Management Strategies for a Successful Turnaround

“When planning for a year, plant corn. When planning for a decade, plant trees. When planning for life, train and educate people.”

-Chinese proverb

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

 

6 Steps to Implement a Cultural Change for Profits

 

If your company is lacking in teamwork, morale is poor and profits are weak, chances are you need to change your organization’s culture. Be forewarned, changing a culture is a monumental chore because it will take strategic planning and super powers of persuasion.

Usually, it necessitates an outside participant to assess your culture and to facilitate the changes. Candidly, as a business-performance consultant, I don’t have to look at the financials to see the problems. It’s possible to “read the room” by watching how employees interact with each other, and with customers and vendors.

In essence, the solutions:

Most cultures require change when there isn’t engagement – not enough listening. Get a snapshot of your situation. Develop a listening plan of action for all stakeholders – employees, customers and vendors.

Determine a mission and the likely solutions, such as more employee ownership of the work, better processes or more accountability. Include models of the desired outcomes, and then communicate what you desire in a new culture.

Your employees will have to learn why culture change is imperative. They will have to be motivated to make needed changes. Along the way, you’ll have to solve the customary political turf battles.

So you approach it like any marketing challenge – create centers of influence within your company – get key employees to buy into it. Find ways to illustrate the problems facing the company. Show them firsthand.

Analyze your staff – whom is being left out? Understand that your managers are part of the problem – commonly, they probably ignore most of the workforce because they play favorites. Analyze your bench strength – an often-overlooked trait for sustainable competitiveness.

After all, you should strategize for a competitive edge.

Good employees want to be involved. They want to feel trusted. Show more empathy to employees by allowing them as much career/personal life balance as possible. You should focus on powering your brand with employee empowerment.

Create a new physical environment. Reorganize work station locations. Engage your employees twice a day – walk the floor asking open-ended questions. Show them you’re approachable.

Key HR training steps

Keep in mind the above ideas, and implement a human-resources communications-training program for a cultural change.

Remember your centers of influence? Supervisors are trained first, then the non-exempt staff.

Experiential training modules for employees should include:

1. Transparency of the organization’s current financial picture and a forecast
2. A SWOT analysis – the company’s strengths, weaknesses, opportunities and threats in the marketplace
3. Assessment of the strengths and weaknesses of the organization in dealing with all stakeholders – employees, customers and vendors
4. Share solutions with all employees
5. Show employees how to conduct their own confidential personal assessments, and how their roles affect the company
6. Motivate them to be fully engaged

Because each situation is different, the priorities of the modules can vary slightly. This works in the public and private sectors.

As a result, a company culture improves for a happier, more congenial environment. Individually, employees increase their self-esteem by double-digit percentage increases. This leads to more profits.

Historically, about 10 percent of employees resist such training. Usually, they need alcohol or drug treatment. Of the two, drug addicts have been the most hardcore and are the most ethically challenged. So I advise the client such people aren’t trainable.

Employees should be referred to your employee assistance program, and be given a chance to improve via a progressive disciplinary process. Use the Golden Rule. Treat the employees as you would like to be treated – as a human capital asset.

Accomplish these principles, and you’ll enjoy more profits.

From the Coach’s Corner, here other HR resource links:

• Human Resources: The Future of Performance Reviews
• 15 HR Strategies to Improve Your Business Performance
• 20 Tell-Tale Signs – If You’re Under-Performing as a Manager 

“Change is hard because people overestimate the value of what they have – and underestimate the value of what they may gain by giving that up.”

— James Belasco and Ralph Stayer

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

 

8 Simple Strategies to Give You Pricing Power

 

If you’re struggling with pricing strategies, you’re not alone. Many big companies struggle, too.

By way of explanation, according to a 2011 study, almost 90 percent of executives in a global survey forecast their continued growth. However, they anticipate implementing just minimal price increases as they continue to slash costs, or at least closely monitor expenses, for positive cash flow.

A global consulting firm, Accenture, reports that’s the salient conclusion following responses from 1000 chief financial officers (CFOs) and chief marketing officers (CMOs), who were surveyed across eight industries in 12 countries.

The study’s objective: To learn how CFOs and CMOs maximize profits in controlling costs, managing money, and in pricing.

Ironically, nearly 50 percent of them expect revenue increases until about 2013. Unlike shorter downturns, the seemingly permanent volatility in this global economy continues to be a catalyst for more due diligence.

Seventy-one percent of the CMOs say pricing strategy ranks among their three most-salient objectives.

So, pricing strategies are universal dilemmas.

Often, companies mistakenly price products and services solely from their own perspectives as sellers. Businesses should focus on the perspective of the customer about value – not solely on offering the lowest price in the marketplace.

Psychology for setting prices

A minority of customers focus solely on price – people who can’t afford not to save money, and people who want to save money.

My research continues to show at least 80 percent will base a buying decision on five psychological perceptions of value. Not all buying decisions are based on what you might automatically think is logical rationale.

Therefore, in the following order, you must know the answers to these questions: What does the customer think of you and your employees, your company’s image, product or service utility, price, and the convenience of doing business with you?

For more expensive items, perceptions about price often include the cost of payments in financing. That’s especially true when the purchaser pays and uses the product on a regular basis.

Specific numbers play a psychological role. That’s why you will often correctly see value-pricing for fast food end in the number, nine, such as $3.99. For more luxury items, a psychology of quality is what counts. So quality pricing will often end in the number, zero.

My definition of marketing: The understanding of your customer for the cost-effective process of selling the right product or service at the right time and at the right price.

Therefore, it’s important to closely monitor your cost structure to generate profits, as well as your customers’ motivating perceptions and the approach of your competitors.

Eight Basic Pricing steps

1. Conduct a full-scale SWOT analysis of your strengths, weaknesses, opportunities and threats.
2. Analyze your marketing strategy, which includes an assessment of your marketplace, targeting and branding.
3. Determine your marketing mix by defining your channels of distribution and campaign maneuvers.
4. Forecast your demand curve by anticipating how your product quantity will fluctuate with the price. Not to oversimplify, consider whether an increase in price decreases your revenue or a decrease in price will increase your revenue.
5. Gauge all your costs – be sure to determine both your fixed and variable costs. Fixed costs, such as office rent payments that remain at the same amount. Variable costs, such as fuel for your vehicles, can change because of gas-station prices or if your vehicle mileage go up or down.
6. Anticipate your marketplace dynamics or environmental factors – whether they are competition or legal considerations, such as government regulations, or impacts from short-term or long-term strategies.
7. Slate your pricing goals. That can include maximizing your profits or stabilizing your prices.
8. Establish your prices, including your methods and structure. Determine the limits of what you’ll offer in discounts.

In addition to the psychology of pricing, you have other choices such as bundling to sell more products; penetration pricing, offering free or loss leaders to launch a new product; variation pricing, like the airlines that sell a flight’s first batch of tickets at the lowest fare; or geographical pricing where the location determines the price.

From the Coach’s Corner, here are related resource links: 

• Daily Deal Sites and Pricing Principles – What’s Sustainable and What Isn’t 
• Hottest Tactics to Beat Your Competitors 
• Think 1930s for Business Success. Consumer Attitudes are Changing.
• Case Study: Mistakes Companies Make When Losing Profits 
• Secrets to Success in Recessions: Expand Marketing 

“Incentives are not strategy, they are tactics. Defensive measures.”
-Carlos Ghosn

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry. 

 

16 Desirable Mental Approaches for Entrepreneurial Success

 

Humor me, as I recall a great sports metaphor for business.

The greatest switch-hitting slugger in baseball history – Hall of Famer Mickey Mantle – was at his best in clutch World Series action. He set several World Series records – 18 home runs, 40 RBIs, 42 walks, 26 extra-base hits and 123 total bases. Before the term “walk-0ff home run” was used, he had 13 game-winning homers.

With all due respect to Willie Mays and his fans, the Yankee great was baseball’s most-feared player. From 1955 t0 1964, he was the fastest and most-powerful perfomer of his time. There were no steroids.

Yet he admitted to having fear, which he often used as a great motivator.

His hero was his father who taught him the game, but died at the age of 39, just after the Mick made it to the major leagues. He always feared dying at an early age, too. So he played hard on and off the field.

No pitcher could repeatedly dominate him. When he connected, he hit the ball so hard, you could see the red laces spin. I did. In game four of the 1963 World Series, my brother and I were in the left-field stands at Dodger Stadium. In the 7th inning, I could see the red laces spin just before we were almost struck by his screaming line-drive off another favorite of mine – the legendary Sandy Koufax.

No. 7 had his share of strikeouts, but my recollection was that he was rarely caught looking at a called strike three. If he did, it was simply a case of the umpire forgetting to wear glasses. He was not afraid to swing at the first pitch. He didn’t cheat himself. He swung hard. When he spotted a strategic opportunity by not swinging for the fences, he took it – he also a terrific drag-bunter, even in his later years.

By the 1964 World Series, pitting the St. Louis Cardinals against the New York Yankees, The Mick’s legendary skills had faded. He shouldn’t have been playing. With a bad shoulder, he no longer had the ability to make laser-like throws from center field. The kid from a rural town in Oklahoma, “the Commerce comet,” was no longer baseball’s fastest runner to first.

Down, but not done

In 1966, he still commanded ultimate respect – published reports indicate other major leaguers still stopped to marvel in reverence at his swings in batting practice – he could still muster the strength to hit his patented monster shots. His mere presence was awe-inspiring. I felt it at the ballpark. Months in advance, I once elected to forgo a Junior-Senior Prom in high school in favor of driving with a buddy 125 miles to attend an Angel-Yankee game. It was a risk as No. 7 as injured. I watched his every move in the dugout and prayed to see him play that day. Without him in the lineup, the legendary Yankee teams weren’t nearly as good.

My favorite of his seasons is still 1964 — his last terrific year, which most of today’s players would have envied. Relying on his experience and courage with a bad knee and right shoulder, he led the American League in on-base percentage with 35 home runs and 111 RBIs. He had batted .241 left-handed, and a stellar .421 right-handed.

In that season’s fall classic in game three at Yankee Stadium with more than 67,000 fans on hand, he had been switched to right field, and Roger Maris took his place in center. The Mick was slow and hurting. In the 5th inning, the Cardinals tied the game at 1-1 when the ball skipped through No. 7’s legs. Oh, no! It was an embarrassing tragedy for the proud baseball player. As a young, passionate Mantle fan watching on television, my heart was broken.

But his chance for redemption came in the bottom of the 9th. For a strategic edge, the Cardinals brought in a veteran right-hand reliever, knuckle-baller Barney Schultz, who had a 1.65 ERA that year. As the leadoff hitter, a shell of his former self, The Mick was forced to bat from his weakest, left-hitting side.

The first pitch was low and outside. The Mick swung – an explosive, towering shot to the third deck in right field, and the sellout crowd went crazy. My eyes filled with tears. You can still see the raw power of a weakened Mantle when he hit that homer — he never gives up and he limps around third base in this video.

Fear as a motivator

The next day, the Los Angeles Times headline: “Mantle: I was scared to death.”

Years later, I learned the Mick had used fear as a motivator. He describes how he actually predicted his game-winner in this interview. The Yankees’ starting pitcher, Jim Bouton, confirmed the story – he overheard the Mick pump himself up: “I’m gonna hit one outta here.”

That was a method of imaging self-success. I never forgot the lesson from the slugger’s self-motivation process for high performance.

Like many baseball players, in today’s marketplace, most entrepreneurs already have the basic attributes in knowledge and talent. But it’s possible to enhance performance.

Underdogs become successful entrepreneurs by creating a competitive edge. Success in entrepreneurship results from strong mental approaches.

Here’s a checklist:

1. Practice imagery. Envision success. Overcome fear. Don’t let it intimidate you. Don’t procrastinate.
2. Think as a maverick – with independence. Strong entrepreneurs listen to others, but they don’t obsess about what others think, especially if there’s disagreement.
3. Passion. You must love the game.
4. Trustworthy leadership. Others are confident in your consistent performance.
5. Values. Do not compromise on principles.
6. Flexibility. Have a game plan, but be prepared to alter it.
7. Timeliness. Sometimes what you do is as important as picking the right time to do it.
8. Stewardship. Be a good steward of your health and business. Work hard but know how to be resilient and nourish your mind and body. Continually evaluate and work for improvements.
9. Be frugal. Don’t waste money, but invest it to create opportunities for growth.
10. Have faith. Be confident in your abilities.
11. Don’t be defensive. If you make a mistake, flaunt it. But prepare for opportunities to redeem yourself. You’ll get a 9th inning like No. 7.
12. Keep an open mind. Just because something is outside your comfort zone, consider taking educated risks.
13. Find a good mentor. Seek someone successful in ways you want to become. Pass it on later when you get the chance.
14. Keep it light when possible. Have fun. Enjoy business and life with a sense of humor.
15. Be charitable. There’s always a worthy cause or people who deserve your consideration.
16. Celebrate your victories with style. Mickey Mantle always lowered his head after a home run. He never taunted the pitcher. He acted like he’d accomplished the feat before.  

From the Coach’s Corner, here’ s another fan’s tribute to the power and speed of Mickey Mantle.

“I hated to bat against (Don) Drysdale. After he hit you he’d come around, look at the bruise on your arm and say, ‘Do you want me to sign it?’”

– Mickey Mantle

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

 

Think 1930s for Business Success. Consumer Attitudes are Changing.

 

Hyper-consumerism is history. Traditional values with a purpose are in vogue.

Traditional values – old-fashioned, if you prefer – describe the new mindset of consumers and what they expect from business. That’s according to a white paper, “The Power of the Post-Recession Consumer,” republished by strategy+business in June, 2011.

Authors John Gerzema and Michael D’Antonio explained a shift in consumers who are now adamant about affordability, connection and quality. It’s similar to the attitudes of any person who survived the Great Depression. The shift has implications for every ambitious company, manager and employee – from human resources and marketing to finance. Many business cultures must change for survival.

“People are returning to old-fashioned values to build new lives of purpose and connection,” the authors wrote. “They also realize that how they spend their money is a form of power, and are moving from mindless consumption to mindful consumption, increasingly taking care topurchase goods and services from sellers that meet their standards and reflect their values.”

Messrs Gerzema and D’Antonio maintain this consumer shift about business started before the Great Recession. It accelerated during the downturn. It’s a worldwide philosophy, not just in the United States. It’s related to disenchantment with the behavior and policies of political leaders. It’s a shift to a new attitude of values and environmentalism.

They call it a “spend shift movement.”

“It will create opportunities for businesses that heed its message, and penalize those that do not,” assert the authors.

As a launching pad for their research, they started with Young & Rubicam’s BrandAsset Valuator (BAV), which is comprised of 20 years in the research of consumer habits, and in more than 40,000 companies in 50+ nations. It’s complemented by the opinions of more than 1 million respondents worldwide, including 16,000 Americans.

Some 70 brand measurements are also included.

“As a factor in decision making, sheer desire or the goods themselves has been declining sharply for the past decade,” the uthors wrote. “More recently, the BAV surveys show sharp increases in the number of consumers who want positive relationships with marketplace vendors and who focus more on corporate behavior.”

The authors report consumers now resist buying brands/products associated with these adjectives:

• “Exclusive” (down 60 percent)
• “Arrogant” (down 41 percent)
• “Sensuous” (down 30 percent)
• “Daring” (down 20 percent)

Consumers now prefer these brand images:

• “Kindness and empathy” (up 391 percent)
• “Friendly” (up 148 percent)
• “High quality” (up 124 percent)
• “Socially responsible” (up 63 percent)

The authors state these attitudes represent the biggest change in the two decades of BAV’s research, and they cite personal-savings data from the U.S. Bureau of Economic Analysis.

“Even as unemployment surged past 10 percent, U.S. consumers socked away more money every month,” the authors explained. “By the middle of 2009, people were saving about 7 percent of their disposable income — a figure that hadn’t been seen since 1995.”

To illustrate the spend shift movement, the authors divided their findings into four tenets:

1. “United by Change” – the shift includes 55 percent of Americans, 53 percent of the French, and 45 percent of the Germans and Italians.
2. “The New Thrift – more than 66 percent of Americans are down-sizing. Among the millennials, 77 percent are cutting back. Companies that deliver according to the expectations of these consumers have a 249 percent better
   word-of-mouth opportunity.
3. “Transparency breeds trust” – The digital age has prompted a new awareness. Consumer trust has dropped by almost 50 percent in companies and governments that fail to adhere to the new expectations. “In  today’s marketplace, successful companies will practice complete transparency, letting customers see their supply chains, management  strategies, and values,” the authors assert.
4. Companies that Care” – empathy should be a top priority. “The ability of a company to identify with its customers is now a prerequisite for any brand in the post-crisis age,” the authors added. “Today, openness, humility, and understanding are critical.  Generosity binds a company to its community and its stakeholders.”

As the authors suggest, think “helpful, reliable, educational and durable.”

For new and existing entrepreneurs, the authors provide this advice: “If you have an idea for helping people learn new skills and connect with others, your business has a good chance of success.”

Amen.

From the Coach’s Corner, here’s a related article: Cause-Related Marketing Can Increase Sales by Double Digits

“One of the biggest responsibilities of management is to look after the corporate DNA.”

-Andrew Rolfe

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

11 Tips to Make Money on Facebook

 

Depending on your type of business, the jury might still be out over whether Facebook can you help you make money by making the cash register ring. But advertisers are increasingly investng in Facebook.

Websitemagazine.com is a must-read for any Internet entrepreneur. Its newsfeed on May 23, 2011 included Facebook’s 10 optimization tips for merchants and reasons to use Facebook’s “like” button. I have to agree.

Here are the first 10 of the 11 promised optimization tips:

1. Allowing users to add comments will significantly increase the number of clicks on the Like button

2. Display Like buttons at both the top and bottom of your posted content

3. Clicks increase dramatically when Like buttons appear near videos, images, infographics and other visual content

4. Like buttons that display thumbnail images of friends will receive three to five times more clicks than versions that don’t

5. Ask questions of users on your Fan pages, such as “Would you like …?” and “Would you prefer … ?”

6. Post fun and interactive content such as games, trivia questions and polls

7. Incorporate coupons and discounts on your Wall

8. Post time-sensitive content and relate to current events

9. Post videos

10. Include links to additional content

The Website Magazine feed also mentioned Buddy Media, a Facebook advertising platform. Buddy Media has raised some serious venture capital – $40 million.

Buddy Media licenses its software to ad agencies. The average fee for its 650 ad agency customers is $3,000 per month. When you consider the licensing fee is on top of the advertising budget, that’s some serious advertising coin being diverted to Facebook spending.

VatorNews is another interesting trade publication. Reporter Bambi Francisco Roizen interviewed Buddy Media CEO Michael Lazarow for some interesting insights. (Buddy Media accounts for 10% of Facebook ads?)

As promised, here’s my 11^th tip to profit from Facebook courtesty of VatorNews: Update your Facebook wall on Tuesdays.

From the Coach’s Corner, before you jump entirely on the Facebook bandwagon, make sure you read this cautionary Biz Coach column: Winners and Losers in Facebook’s Invasion of Google’s Turf.

“The Internet is the trailer park for the soul.”

-Marilyn Manson

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is also a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

 

Marketing Checklist to Measure Your Brand’s Personality

 

Here are two key questions about your marketing: 1. How much have you invested in your brand and personality? 2. How’s it working? 

These are important questions. However, many companies – large, medium and small – can’t accurately answer the questions. That’s especially true regarding their return on investment. Yet, ROI is critical to measure.

Research shows how to gauge your brand’s personality appeal – if it’s suitable to yield sales.

“We developed this means of measuring brand personality appeal (BPA) so companies can figure out how favorably their brand personality is viewed by consumers – and what they can do to enhance that personality’s appeal to their market,” says Dr. David Henard, an associate professor of business management at North Carolina State, in a press release.

The paper, “Brand personality appeal: conceptualization and empirical validation,” was co-authored by Henard; Dr. Traci Freling, of the University of Texas-Arlington; and Dr. Jody Crosno, of West Virginia University. The paper was published in the Journal of the Academy of Marketing Science.

“Until now, researchers have only been able to determine whether a company has a brand personality,” Henard says. “The only existing scale was Aaker’s Brand Personality Scale, which could determine whether a brand personality is rugged, sophisticated, competent, exciting or sincere.

“What we’ve done here is develop a system that digs deeper to help companies link brand personality to concrete outcomes. For example, does the brand personality actually make people want to buy their product?”

The 2011 study lists 16 questions to ask about your brand in three variables: Favorability, originality and clarity.

The press release explains: “Favorability is how positively a brand personality is viewed by consumers. Originality is how distinct the brand personality is from other brands. Clarity is how clearly the brand personality is perceived by consumers.”

The press release offers more explanation about the three variables.

“For example, a company may find that its brand personality has a moderate rating on favorability, but is viewed as highly original and clearly defined. High marks for originality and clarity make the brand personality more appealing than the moderate favorability rating might indicate. It also tells a company that it needs to focus its efforts on improving its favorability rating, rather than distinguishing itself from competitors, in order to boost the brand personality’s overall appeal.”

The 16 questions:

1. This brand’s personality is unapparent…apparent
2. This brand’s personality is distinct…indistinct
3. This brand’s personality is satisfactory…unsatisfactory
4. This brand’s personality is obvious…not obvious
5. This brand’s personality is unpleasant…pleasant
6. This brand’s personality is common…distinctive
7. This brand’s personality is attractive…unattractive
8. This brand’s personality is ordinary…novel
9. This brand’s personality is positive…negative
10. This brand’s personality is bad…good
11. This brand’s personality is vague…well-defined
12. This brand’s personality is poor…excellent
13. This brand’s personality is undesirable…desirable
14. This brand’s personality is predictable…surprising
15. This brand’s personality is routine…fresh
16. This brand’s personality is unclear…clear

The study provides interesting food for thought, right? Munch away.

From the Coach’s Corner, here are more resource links to increase profits:

• Checklist to Build Your Brand on a Budget
• Study Provides Vital Lessons for Web Sites Seeking Profits
• Checklist: 19 Quick Marketing Tips for New Entrepreneurs

“What’s a brand? A singular idea or concept that you own inside the mind of the prospect.”

- Al Ries

 

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Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

 

Checklist for Success in Business Planning for the New Economy

 

Question: How is your year progressing? For many, the year isn’t faring well, and it’s obvious we’re undergoing fundamental economic change.

To be sure, handwringing is to be expected. But productive steps need to be taken for market leadership. This lack of business enthusiasm indicates businesspeople are having trouble focusing on priorities. Many are too preoccupied in fearing failure instead of their strengths. Is this your situation?

It’s important to develop an IQ for keeping an open mind for change and improved competitiveness. Adaptability and flexibility to adopt old and new ideas are keys to success in a dynamic marketplace.

Here’s a checklist of reminders:

1. Daily review your financial reporting. Cash flow is king.
2. Don’t get sidetracked. Take prudent steps for financial balance. Control your expenses but devote enough time for marketing and selling – each day.
3. If you have employees, implement a collaborative environment to execute strategy. Know how and when to delegate.
4. Use the latest thought leadership to evaluate your workers and ensure employee loyalty. Retaining talent is important for keeping your human, intellectual capital.
5. Customers love environmentally responsible companies. Consider how you can differentiate your firm from competitors. For strategies, see this article: Checklist for Branding, Selling Your Biz as Green.
6. Decide on a social cause in cause-related marketing. Enhance your participation in causes,  and in socially responsible management practices.
7. Examine your customer-support practices. Understand what it takes for customer loyalty and for branding in attracting new business via traditional and emerging media.
8. Take steps for price satisfaction, but don’t give away the store. History shows businesses fail when they focus too much on selling at the lowest price. For more explanation, see: 8 Simple Strategies to Give You Pricing Power.
9. Continually talk with your customers, and read, research and implement strategies for growth.
10. As much as possible, stay current on technology to save you time and money.
11. Whenever possible, keep it simple. That includes everything from your business processes to your value propositions.
12. Don’t throw the baby out with the bath water. Younger businesspeople, in particular, tend to impulsively make unnecessary changes. It’s important to check motives. Consider whether such decisions are fact-based solutions or stem from ego.
13. Explore all options to grow organically before buying other firms. Before you embark on a merger, consider all human resources and cultural factors. Most mergers aren’t successful for this very reason (see If Mergers & AcquisitionsTempt You, Consult HR Pros).
14. Include strategies for multiplying your revenue stream.
15. Speak and act with conviction about your mission to passionately meet the needs of your customers. Execute with authentic optimism. Smile even when you don’t feel like it. Customers, employees and other stakeholders love a jovial Joe or Jane. Make certain your attitude is contagious – that it’s worth catching.

Good luck in your business planning for the new economy.

From the Coach’s Corner, this business portal has countless tips on marketing/sales.

Here are recommendations for hiring the best talent, and how to properly evaluate employees:

• Human Resources – Slow MotionGets You There Faster
• Human Resources: 12 Errors toAvoid in Evaluations

Money can’t buy happiness, but  it sure makes misery easier to live with.

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