Archive for the 'marketing' tag

As I’m sure you’re well aware, the economic model that currently supports most of Western Civilization appears to be in the process of a major melt-down. These tough times are going to call for some creative thinking to pry the money you need to keep your doors open from the hands of the customer that is worried about keeping their job or paying their mortgage.

This month I’m going to talk about discounting and other promotions. In the past I have laid out my general philosophy that if you run a proper operation you should not need to think too much about discounting. I still hold by that sentiment. I’m not talking about some kind of grand fire-sale along the lines of those furniture stores that seem to be going out of business every other week.

What I am talking about are developing, and more importantly communicating, discount-type promotions that entice a shopper to buy from you if they were not going to buy from you in the first place, or to buy more from you if they were buying anyway.

An over-arching theme is that you never give anything away for free. If you are giving it away (cue the Red Hot Chili Peppers), then it’s only logical that the customer is not going to ascribe any value to it. You want to come up with some manner of telling your customers that you are buying something for them. After all, that’s what you’re doing, so why not position it that way?

Some people may consider it a matter of semantics but I think it’s an important distinction if you are trying to do some type of discounting yet retain a brand identity different from the multitudes of internet discounters.

For example: You are not offering “free shipping.” You are paying for the customer’s shipping. So instead of “Free shipping on orders over $150″ you need to communicate it like “Spend over $150 and we’ll pay your shipping.”

Yes they are functionally equivalent, but I think the latter has more value. Sure not everyone is going to look at it that way, but it helps. And it’s the thought process behind this that should be driving you as you craft discount or promotion methods.

A next point is to remember that your goal of discounting should be to get people that would not otherwise buy from you at full price to buy from you at a price that you are still willing to accept.

Let’s say that you run a promotion that requires customers to enter a discount code at check out to get 20% off their orders. I would say that in most circumstances that you would want to publicise that code to customers via advertising like e-mails or off-line print ads, but not publicise the code on your site. If someone hits your site off a Google search with the intent of buying something you’re selling, and they are willing to pay full price, why in the world would you be willing to accept less? Use the e-mails and print ads to drive incremental traffic to your store and the discount to increase conversion.

A lot of this is going to depend on the type of business you run and the type of normal customers & traffic you have buying from your site. You need to do some in-depth analysis of your analytics and sales data from the past. The goal should be to come up with discount methodologies that enable you to get full price from people that were willing to pay full price going in.

Next, you should try to come up with methods to coax a higher level of spending from people already buying. A good way to do this that also brings them back on a later date to buy more are instruments like gift certificates that are good for a certain dollar amount once they spend over a set limit. Say, “spend $300 today and we’ll email you a gift certificate code good for $30 off your next order.” You are hopefully pushing those customers sitting there with $250 in their cart to add another $50 to get the $30 gift certificate that they may use another day. And of course hopefully on that next visit they spend more than the $30.

Obviously you’ll again have to dip into your analytics and sales data to try to come up with the thresholds and values that make rational business sense for these types of promotions.

And finally here’s one of those brilliant ideas that keep you coming back to read my column every month. Because so many of you non-snow vehicle related retailers are sitting there looking out of empty showrooms at piles of the white stuff, here’s an idea to generate some cash now and defer the outflow until you’ve got more organic sales going on in the spring. Sell something like a “spring certificate” on your site that is good for a certain percentage above the face value when used between certain dates in the future (the certificate’s magic window).

Here’s an example: “Buy our Spring Certificate this week for $200 and when you come back and use it between April 1 and May 31 and we’ll increase the value to $250!” If they use it outside the magic window it’s still worth the face value of $200. This allows you to get cash from the customer now on your books with a potential liability for a lower margin during a set window when you should be generating enough sales to cover it. And I can promise you that not everyone will use it during the magic window. And of course there’s even a percentage of people that will never use it at all. You do realize that some estimates put the amount of money that will sit there unspent on those “gift cards” around $10Billion for 2008? It’s possible that the amount of people that don’t spend all of their $200 at all may make up for the loss in margin from the discount.

Fine print: I’m sure there’s some accounting and/or legal magic your controller and lawyer are going to have to perform to account for the future liability, cash flow, proper wording, etc., etc., etc. so make sure you get all that squared away before you launch something like this.

I’m going to leave you with one overarching theme that I recommend you use in all of your advertising and marketing messaging: motorcycles and powersports are the ultimate escape from the strife that people are being bombarded with every waking moment these days. Motorcycles and powersports have always been about freedom and getting away from it all. If you’re bombing through the woods on a dual sport you typically don’t have a lot of spare brain-cycles to be worried about your mortgage. If your cruising past the majestic Grand Tetons with your significant other behind you and soaking it all in, you typically are not thinking about the annual return on your 401k.

We are in the escape business. Economic realities may be dictating that people are not buying new bikes, but we can sure as heck make sure we help them get the parts, accessories, and gear they need to get out and enjoy the vehicles they already own. Intelligent discounting and promotions in your e-commerce operation can be a huge help. For them, and for you.

Tags:Column, dealerships, E-Commerce, ecommerce, internet, marketing, motorcycle, powersports, Powersports Industry, selling-online

In all my years of writing about “all things web” (granted weighted heavily toward e-commerce) for the motorcycle and powersports industry, nothing has seemed to reach the same level of resonance as my idea that developing a dedicated, full-time community management position was a brilliant thing to do.

When I was running marketing for the dealership that I work with, I had put on a few really successful open-house events. The “light bulb” moment came when I said: “we need to do stuff like this every month!”

That required someone dedicated to coming up with the ideas, handling all the logistics, etc. But I then saw this role as much more than just an “event” person. We need to do more community stuff. Community stuff takes a lot of time. I need a full-time person to do it. Bingo! It was that simple.

I also wanted them to start being the “face” of the company on all our our online social networking activities. That led to me climbing up the abstraction ladder to call the position community relationship manager.

In short, this position is THE public and personal face of the company.

I just came across a post on ReadWriteWeb that deals with the same idea. Their article is obviously written from a more theoretical framework, while my take on it is much more the result of pragmatic, hands-on needs.

Marshall asks the questions “Do Startup Companies Need A Community Manager?” My answer is of course a resounding “YES”. However, like pretty much everything else it all comes down to the ability to execute on the idea.

It’s not PR!

PR is dead. The two-faced, B.S. spewing PR flacks that have made their money by coming up with ever more creative methods to lie to a company’s customer are going to die a loud and long overdue death.

PR was a one-sided shouting match. The new age of community is more about listening than talking. One thing that most PR people seem to have is a genetic aversion letting anyone else talk or listening to them when they do.

No one with ANY hint of PR on their resume should come anywhere near a community relationship position!

But what about all those functions that PR serves? Like minimizing damage when the company does something stupid or bad? Or “spinning” one result to be seen as something totally different?

Oh, I don’t know… How about not doing things like putting poison in kid’s toys, or letting poison food get produced in the first place or simply telling the truth?

Naive? Probably.

The direction that the world is going to force you to go? Absolutely!

Might as well start recognizing that you’ve got a transparent kimono on. Open it up… Or don’t… Don’t matter because people are going to know what’s going on anyway. You might want to see how the truth works for a change.

It’s not Marketing!

Marketing still has a valuable place when it comes to developing the identity and the initial message. But marketing is going to need to become much more participatory and reactive to the reality being dictated by the real world.

It must be legitimate!

Don’t lie. If you have a position that the market doesn’t seem to like, then explain in truthful detail why you did what you did, do what you do, or are going to continue to do what you did. Even people that hate you will at least respect you. How is that a downside? And who knows, maybe being honest may actually turn some people onto you. After years and years of BS, maybe legitimacy and honesty are worth giving a try?

It may be a game changer!

This has the potential to be one of those paradigm changing ideas that fundamentally changes the way companies communicate with their customers.

Customers don’t want to listen to PR B.S. and they sure as hell don’t believe anything that comes out of a marketing or advertising department.

There are of course risks. The old model of how PR/Marketing crafted and controlled a focused message or identity is over. In reality the only messages or identities that really mattered were the ones that the customers created for themselves and communicated to each other.

In the past it was obviously easier for a large company to force conformity to the desired message, but as the number of communication channels is now nearly infinite, there’s no way any company is going to be able to effectively control their message or ID.

Companies must sooner or later respond to the fact that the key to their company’s long term survival is the active and honest communication and participation with the market. And in non-economic terms, what’s a market if not a community?

This is going to totally shake up so many business practices! From product development, to accounting, to of course sales and marketing.

It’s going to bring about the need for greater transparency. Worn-out corporate double-speak is dead. The old guard PR industry is going to die (no doubt kicking and screaming about “losing control”).

It’s time for companies of all sizes to realize that they have already lost, or very shortly will loose, control over their true image.

So it’s time now to start crafting plans and organizations that can communicate and participate openly and truthfully with the market. That starts with the Community Relationship position.

If you really want to take this on and understand it, you need to closely read Groundswell. It will articulate in detail pretty much everything I’m talking about. But with better writing and more footnotes.

Tags:community-marketing, community-relationship-management, marketing, pr, relationship