Archive for May, 2008

How to increase your return rate

It is no secret in business the best customers come back time and time again. More often than not, 20% of your customers make up 80% of your sales. How do you get and retain those highly valuable customers who make up your bottom line?

1. Offer a great service or product

I know this sounds really simple, but if you are able to separate your business from the competition by going above and beyond to please your customers, they will come back. Having a reputation of being a high-quality mechanic in a car-fueled world is worth thousands. When you offer a product or service, make sure it is one that people will remark about.

2. Give them something extra

This is why you see coffee and magazines in the lobby of doctors’ offices and tire repair shops, not to mention having televisions to help pass the time. At our local grocery store, they always offer to carry out your items to the car. What if a pizza delivery place added $.50 to each pizza, but advertised free delivery instead of the other way around? People love anything free and would probably like that idea. In a time of high gas prices, people would love to save at the pump. And if the delivery is free, why not use it? It beats telling your customer you have to charge them more to deliver because of the high fuel costs.

3. Get them to come back

In the town I grew up in, there is a tire store franchise that is completely remarkable. Les Schwab tires is a western USA tire store that has really focused on delivering exceptional service. You will always see the employees running everywhere and with a smile. I am convinced they all love their jobs and wouldn’t rather be anywhere else. Some of the services they offer include free tire rotation (which they recommend every 3,000 miles). Whats the point of this? Well, on top of forming the habit of always visiting their store every oil change, they are able to point out preventable maintenance. I see your tires are getting worn mam… and much more. They also fix flat tires for free too, that is if you can get it to the store. This store is doing so much right in the way of getting people everything they need, want and didn’t know they needed. I can’t imagine them ever going out of business.

4. Focus on the customers who bring home the bacon

The Pareto principle (also known as the 80-20 rule, the law of the vital few and the principle of factor sparsity) states that, for many events, 80% of the effects come from 20% of the causes. Like I mentioned earlier, about 20% of the customers bringing in 80% of your business means that 80% of your time and energy should be focused on those 20%. Sometimes you have to ignore or cut loose some customers who are draining your resources. I occasionally get emails asking for my help with different projects or ideas and most the time I have to politely decline. I decline because the payoff in time spent and benefit received just is not there. Your time is valuable. Make sure you treat it the same as you would $1,000 in your hand. You wouldn’t just throw the money away on something wasteful or frivolous; the same should go for your time.

Do you treat your blog like a business? If no. Do you want to?

The best business model meshes the best of online with offline. By finding a unique and interesting way to combine the best of both worlds, you will succeed in both.

The ultimate way to mesh online business and offline business it to have a product or idea that can flow between the two. A family friend of ours owns the Mt. Shasta View souvenir shop in Weed, CA. The funny thing about this shop is the merchandise the store sells. Located at the foot of Mt. Shasta in Northern California, Weed was named after a timber baron, Abner Weed. Nowadays the use of the word “weed” is more often than not associated with marijuana. Needless to say, the town of Weed has a lot of jokes surrounding it. Back to my friends shop.shirtenjoy.jpg

This store has been in business selling souvenirs for about 60 years. I am also willing to bet that some of the best selling t-shirts were created not long after. As of lately, they have started moving their tangible business from the store in Weed more online. Sales have been trickling in from all over the country. My guess is that most of the sales have resulted in some potheads finding the site after searching for different t-shirts on Google. Now this is an instance of a “real world” business making its way online and growing even more.

The million dollar question is how do you take your online business and incorporate both businesses and people offline? As I was flying to Washington State yesterday it occurred to me that probably the easiest solution is through the use of business cards. What if you had not only a business card, but a business card with value attached to it? What if your card had $500 off first-time Internet business consulting? This would convey that not only do you do consulting, but that you also must be doing a good job to deliver $500 off. Make sure to express that this only works by having the business card. Now that card becomes something of value and worth. Who loses something worth $500 bucks, right?

Now if you know how to hold someones attention by getting them to see that you have a skill that they like, and they have a need you can fill, you are on the right track. They have your card in hand and wont easily lose it, knowing that it is worth $500. Perhaps, to make it even more dramatic don’t have the discount printed on the card, but rather, lay out a line that you enjoyed their time and their company and write the discount out on the card before handing it to them.

The proper way to read a business book

If you have never visited or read any of Seth Godin’s books or blog posts you must. I enjoy the insight and practical ways he presents marketing and business.  Here is a quote:

“There’s a huge gap between most how-to books (cookbooks, gardening, magic, etc.) and business books, though. The gap is motivation. Gardening books don’t push you to actually do something. Cookbooks don’t spend a lot of time trying to sell you on why making a roast chicken isn’t as risky as you might think.

The stakes are a lot higher when it comes to business.

Wreck a roast chicken and it’s $12 down the drain. Wreck a product launch and there goes your career…”

It would be a great idea to spend some of your free time diving into some of his blog posts, even better if you have the time to read or listen to some of his bestseller books.

Today I leave for the family cabin in the Marble Mountain Wilderness and I shall return with some pictures, hopefully tomorrow night.