Missed Marketing Opportunity
Tuesday, December 26, 2006
How one company blew its chance to create customer loyalty!An, unfortunately, too common occurence.Recently, our trash hauler sent an invoice with an additional charge for paying by check. Neither my wife or I remembered receiving a notice of the additional charge. When my wife called to inquire she found that no prior notice had been sent, but, she was assured, if she signed up online to have the payment withdrawn electronically the additional charge would be credited on the next invoice. A trip to the website found that it wasn't operational. A second phone call revealed that their server was down. When the server was operational again, it took my wife an hour to complete the necessary online registration. We are looking for a different trash hauler. Now, imagine how we would have felt if the trash hauler had: - sent a notice telling us that they were trying to help us keep our costs down
- that a price increase (not a coercion charge) could be avoided if we were willing to pay electronically, instead of by check
- that the choice was ours
- that they were pleased to serve us regardless of which option we chose
It's counter-intuitive, but cost-cutting moves offer tremendous marketing potential. Your approach will dictate whether you have a life-long customer or a former customer. If you have topics you'd like me to address, email the concept to me at dale@furtwengler.com. I wish each and every one of you a healthy, happy and prosperous new year!
Gauging Financial News
Monday, December 18, 2006
Can bad news really be good and vice versa?It often is.A retailer's profits are down due to heavy inventory losses. The stock's price drops 8% on the news. A telecommunication company's profits soar. The market rewards stockholders with a 13% increase in the stock's price. Are these market reactions appropriate? Not in these cases.
The retailer had finally come out of denial, recognized that they had a problem and taken action to remedy the situation. The inventory losses they had experienced weren't likely to be repeated. That's good news. The market should have rewarded the company's actions by increasing, not lowering its stock price. Indeed, the company's leadership did fix the problem and the company's efforts were rewarded, but much later than they should have been.
The telecommunications company was cooking the books. It was the only telecommunications company making money in this era. Yes, I talking about WorldCom. The incredibly "good news" was a fabrication which should have caused the market to ask "How can this company be making money when all of its competitors are struggling?" I asked the question, unfortunately I didn't research the answer in time to avoid getting caught like a lot of other investors.Don't be fooled by the news. It's counter-intuitve, but what appears as bad news may be exactly what the company needs to thrive in the future. Conversely, what appears as good news can be leadership's denial of underlying problems. Whenever you're presented with financial information, ask yourself "What would make this bad news good or this good news bad?" This questions works as well in managing your operations as it does for stock investing. I'll be happy to address any topics of interest to you, simply email your question or comment to me at dale@furtwengler.com. Happy Holidays!
Best of Ten
Monday, December 11, 2006
Are you focusing on the right things?Many of us aren't.Recently I was playing "best of ten" with two of my nephews. One of us picks a spot on the basketball court and each of us takes ten shots from that location. The one who makes the most shots wins. My youngest nephew decided to stand at the foul line and bounce the ball into the basket. Initially, we were all focused on the basket. Soon we discovered that if we paid attention to where the ball hit on the court we could dramatically increase the percentage of shots made. How often, in our businesses, do we focus on the end result instead of the various steps in the process that will assure the outcome we desire? It's counter-intuitive, but focusing on successfully completing each step of the process will assure the end result.
Please let me know what topics would help you achieve superior results in your business. I'll be happy to address them in this blog. My email address is dale@furtwengler.com. Your privacy will be protected.
Pricing and Sensation Transference
Monday, December 04, 2006
Are you being compensated well for the value you provide?Not if you're sending conflicting messages to the market.In a recent blog I told you about sensation transference, the effect that the look and feel of packaging has on a customer's perception of the quality your product/service offers. Most people don't realize that pricing is part of the packaging.A new client was perplexed. He was providing tremendous value in the services he offered, yet he was struggling to acquire new customers. As we explored this dilemma, I realized that he was sending conflicting messages to the market. Despite the high quality of his offerings, his price was 30% lower than his competitors. If you were a buyer which would you believe, my client's claim to exceptional quality/service or the low price which indicates the opposite. Within 60 days of rebundling my client's offerings and matching the price to the value provided, he experienced significant growth in new customers across all of his offerings.A dear friend, Karyn Buxman, Founder of Humorx and a Certified Speaking Professional www.humorx.com, like many professional speakers experienced a sharp decline in bookings immediately following the 9/11 tragedy. While many of her competitors lowered their prices to salvage some market share, Karyn looked at the value she provided and raised her prices. The result? Karyn experienced an increase in bookings at a time when most of her competitors were struggling. Her message to the market was clear, I offer great value and that value is worth the premium. Her pricing sent a message that was congruent with the value she provided. It's counter-intuitive, but pricing is part of the packaging. Your customers' impressions of your offerings will be influenced by the price you charge.If you'd like to be compensated well for the value you provide, this month's Invaluable Leader Special Report entitled "...but your price is too high" will help you dramatically increase your revenues without increasing your cost. Just click on "Special Reports" to order "...but your price is too high" and you'll enjoys years of improved profitability.
|
