Archive for February, 2011
Keys to Leasing a Honda or Any Vehicle
Posted by: | CommentsIn a recent post I discussed the pros and cons of leasing a car versus buying a car outright. I primarily covered the financial side of the equation but obviously much more goes into the decision. The greatest advantage of leasing a car is that every 2 to 3 years you end up with a new vehicle and generally will have no unexpected out of warranty expenses. Another great advantage is you never have to negotiate the sale or trade in of your existing vehicle. You don’t have to take car rides with strangers doing a “test ride” or get taken to the cleaners by a used car specialist at a dealer. With a lease you hand the keys over and walk away. But the key is to get the right price to start and most people are totally lost when it comes to car leasing.
There are eight critical steps in preparing for and executing a car lease:
1. Research online the exact make and model you are looking for at a site like Edmunds. Find all available rebates for the exact model including hidden rebates and dealer kickbacks. You can also generally get an idea of what others are paying in your area.
2. Choose a dealer. You can research dealer inventory online. Find a dealer that has the car and color you want. Instead of having to have the dealer transfer cars which is costly to them, go to the dealer that has the vehicle you want. Unfortunately this will often favor the larger dealers with deeper inventory.
3. Send a premliminary email through the dealer website. Tell them exactly which car you are looking for right down to the stock number and what you would like to pay for the vehicle. Wait for a response.
4. Arrange to visit the dealer after they respond to your email. I prefer to deal with them in email so that everything is written versus verbal.
5. Check your credit scores online using sites like myfico.com for Transunion and Equifax and Creditexpert.com for Experian. Honda uses Experian in Massachusetts. You can usually ask the dealer finance manager which credit bureau the manufacturers finance company will use to make sure your report is clear. In general auto finance and lease quotes assume you have a super preferred credit score which is 720+ in most cases. Keep in mind this is the auto enhanced score which is different than what you will see from the consumer sites. Only the dealer can see your auto score but keep in mind in my experience if your personal score is 700 and you have paid for a couple of cars on time your auto score will be higher. Sometimes the lease deals also will allow regular preferred scores to qualify for the best rate which is 640+ on the FICO scale. If your scores are substantially lower than 650 or 640 I would tell you that leasing probably isn’t your best option. Instead use sites like creditboards.com to review discussions on how to improve your credit score prior to applying for a loan or lease.
6. Once you arrive at the dealer make it very clear to the sales person and to the finance manager that you want your credit report run only by the auto finance company. Most dealers want to check your score too and although in general there isn’t a ton of harm in this the dealer is not leasing you the car. Honda Financial Services, Toyota Motor Credit, NMAC (Nissan Motor Acceptance Corporation), Ford Motor Credit etc. are the ones doing the leasing and making the decision. They are the only ones that really “need” to see your report. Make it absolutely clear that you only want to use the manufacturers bank and that there is no need to shop your lease around. I will often write this right on the sales quote/release that I sign. I will discuss why you want to make this clear below.
7. Settle on the purchase price for the car. Do not get into the “what do you want your monthly payment to be” discussion with the dealer. It’s totally irrelevant. You care about the selling price just like a traditional car purchase. Monthly payment has nothing to do with it. Even the special deals being given by Honda right now are negotiable. Once you have the price agreed on it is time to move on to the next stage.
8. At this point you can explain that you are interested in leasing through the manufacturers finance company. Based on you finding that your credit scores are good have the dealer assume you are super preferred. Ask them for the residual value on the car and also the money factor. With that information go to the car lease calculator and enter the information. MSRP is the sticker price. Base cap cost is simply the price you agreed upon in step 7. Additions to cap cost/step 3 on that site are often rolled into the agreed upon selling price in Massachusetts. IE, most dealers will tell you the bottom line which includes those fees which aren’t negotiable. The bank acqusition fee is a great example. That is essentially the bank profit on the lease. The dealer may tell you they’ve waived it but it’s still going to end up somewhere in the purchase price just like the delivery fee. Step 4 are cap cost reductions which include any money you decide to put down on the lease. I won’t offer an opinion on this other than to say putting money down on a lease tends to defeat the purpose of leasing. Step 6 is the residual value. Most car companies do this on a percentage basis but the Lease Calculator site allows you to enter it either way in case it’s a dollar figure. This is the value of the car at the end of the lease. The higher the percentage the lower the payment which is why domestic cars have never leased well as their residual values are often lower. The rest of the steps involve entering sales tax if applicable. The figure you get after using that calculator should EXACTLY match what the dealer quotes you. If it doesn’t have them explain why. We have had dealers “by mistake” double sales tax hoping we wouldn’t catch it or “accidentally” add in the extended warranty. There is no magic to lease calculations, all you need is the “cap cost” which is the agreed upon sale price, the residual value expressed as a percentage or dollar figure and the money factor or interest rate. From there the calculator gives you everything you need to know.
In summary, first and foremost leasing a car is no different than buying a car. We are going to use the Honda Civic example again. When you first arrive on the lot and the salesperson asks what you’d like to pay per month politely explain that you’d rather discuss what the final car price will be. Use sites like Edmunds.com and more importantly Edmunds Townhall to see what people are paying for the car after all rebates. There are often hidden dealer incentives that you would never know about without visiting that site. Sometimes it’s a percentage holdback that the dealer is getting and sometimes it’s a direct incentive applied to a lease or purchase. For instance through today Honda is offering a $1,000 hidden incentive on all Civics. The MSRP on the car is about $16500. The invoice price is about $15,300. With the $1k rebate factored in a fair sell price on the car would be anything above $14,300. Personally I believe the dealer should make some money and don’t go in looking for the deal of the century. This has always served me well. If I were buying or leasing a Honda Civic I’d probably offer about $14,600 explaining to the sales person that this can be quick or it can be the normal back and forth that goes on for days. I always know which vehicle I want when I visit the lot and explain that I don’t want to price shop. I respect the salespersons time and if there’s a choice of making $100 or $200 of selling a car over six hours of work versus selling it in two hours all parties would rather have it done in two hours. Be fair, be reasonable and even major dealers like Boch that sometimes get bad reputations will work with you and the process is painless. Go in asking for a car at 2k below dealer invoice and you are in for a battle. Use all of the available data on sites like Edmunds. If you walk into the dealer and tell the salesperson you are aware of the hidden rebate they know right away you are not playing around. I always come right out and tell them “we can do this in 2 hours right now and you can move on to the next sale or we can play games for days” and the vast majority of the time the deal is done in a few hours.
Other car leasing tips:
Use the Manufacturers Bank: For quite a few years it was common to see newspaper ads with incredibly low lease rates on cars. There was a catch though as the lease company was not the car companies captive bank but third party banks. They don’t care about you, they don’t care about the car company or making you happy at the end of the lease. They want to make money off of you. Most of the time when you hear horror stories of lease turn in fees for damages being sky high it was through these third party banks. Honda, Nissan, Toyota, Ford and just about all the others want your business. They want you as a loyal customer. Honda recently sent us a letter telling us they’d pay our last two payments and waive up to a $1000 in damages if we leased another Honda. As it is almost every manufacturers car lease will come with a $500 “freebie” towards items broken or missing at the end of the lease. You will almost always get a notice from your lease company inviting you to lease again, waiving fees and providing other incentives. With Honda, Toyota and Nissan the lease turn in process is almost painless. Almost all of the major leasing companies give you a few dings per door panel, scratches and normal wear and tear. They want your business, they want you to be happy and they want you to buy or lease another vehicle from them in the future. It is also a lot easier to trade the car in early if you decide to go that route.
Rack up the Rewards: If you decide to make a downpayment or pay the initial upfront costs use a credit card. Most dealers will take the charge card happily, it gives you another 30-45 days to pay the bill and if you use the right card you may increase your rewards. It also gives you some leverage just in case anything does go wrong in the transaction.
Pick your Dealer: Don’t waste their time. Do your research online. Send an email online through the dealer site. Generally they will assign two people to you. The first handles the internet communications and will then hand you to a salesperson when you arrive. In my experience you get the premier salespeople as I think the dealers reward their best people. In several dealings with Boch I have found the people I was given at the dealership were outstanding. I have had much better luck with the mega dealers. They have more vehicles they want to move out the door and more choices. At times I have done very well with local smaller dealers. At the same time if they have exactly one of the make/models you are looking for chances are they aren’t going to give you the best of the best deals as they need one on the lot to show people anyway. The mega dealer with forty of the same make/model/color could care less and wants the care gone.
Check your numbers: Use the lease calculator site to check your numbers and their numbers. If something doesn’t add up find out why BEFORE you sign.
Insurance Agent: Let your insurance people know before you leave the house. Tell them you may be leasing a new car and get their fax number so you can pass it to the dealer.
Excise Tax: Leases at one time included the excise tax in the monthly payment. Now most will bill you in April for the excise tax in full. If you ask they will break the payments out in most cases if need be but many are shocked to get a $300 excise bill in addition to their regular payment.
Tired of the car? It’s a myth that you cannot “get out of a lease.” If you lease a good, reliable and in demand car you can often make a move during the lease period. A recent vehicle we had was actually worth thousands more than was “owed” as part of the lease payoff. In the Civic example 18 months from now the payoff may be $13k for example. If the dealer is willing to buy it back for $13,200 you can actually trade up to a new car putting $200 in equity towards it. Even if the value was only $12,000 you can easily make up the difference and roll it into a new lease. Most lease companies will allow up to 110%, IE if you are leasing a 20k car they will “lease” up to 22k. Not the best thing to do but if your life changes you are never stuck unless you buy a clunker that nobody wants and that depreciates like crazy.
Drive a ton? If you drive more than 15 or 20k miles a year leasing probably isn’t for you. Sure you can easily pay the over mileage at lease end but if you drive 40k miles a year the over mileage will be enormous. Leasing is best for people that drive 10-20k miles a year.
Turn the Keys in and Walk Away: At the end of the lease you will either trade it in at a dealer for a new car, or drop it off at a dealer for an inspection. You don’t have to negotiate a trade in price, have someone haggle you down over a few scratches or a stain on the seats. You walk away and move on so long as you have kept reasonable care of the car. If you smashed the car up in an accident as long as you had it fixed by a professional you are good to go. You won’t get whacked with “loss in value” fees from a Carfax report or anything like that. It’s no longer your problem, move on. That’s the beauty of leasing.
Check your Credit: Mentioned this above but make sure your credit is good or you are wasting your time and money. Also this helps to make sure you have not locked your credit reports which will prevent any financing in the first place.
Good luck. Questions, thoughts and suggestions are welcome and these two documents will be modified as needed. To read the leasing versus buying a Honda discussion follow the link.
Leasing vs Buying a Car
Posted by: | CommentsOne of the most common questions I see asked about cars centers around the lease versus purchase decision. There are people on both sides of the debate with strong opinions. Those against leasing probably had a bad experience in the past with fees or damage surcharges while those against purchasing have probably had a relatively new car require repairs. Car companies have either inadvertently or deliberately made leasing a lot more confusing than it has to be and that only contributes to the perception of some that it’s not the way to go. After buying and or leasing over thirty cars as part of personal and fleet purchases I will attempt to explain the differences using a current make and model as an example. This first post will take a look at a single specific vehicle and compare the costs of leasing versus buying.
Almost every major car manufacturer will have their current offers listed on the website. In this example we will look at a 2011 Honda Civic Sedan Lease. This is for the DX VP model with an MSRP of $18,405. The program calls for $1999 out of pocket which includes the inital acqusition fee, first months payment and all fees such as registration. The total out of pocket for 12k miles a year for 3 years is $6,864. To go to 15k miles a year you will pay about an extra $10 per month. I’ll take a moment to talk about buying the extra mileage up front and go so far as to suggest it if you do normal amounts of driving. The penalty per mile over 36k is .15 cents per mile with Honda. Other companies charge more but 3k miles at .15 is $450 or $37.50 per month. Factor 15k miles a year in at the point of sale and save yourself some trouble unless you really do drive less than 10-12k miles a year. If you are on the fence, would you rather pay $10 or so per month or $1200 at the end of the lease for going over the limit? During the course of the lease you are required to perform routing maintenace on the vehicle. I’ve never once had a company check the records at lease end but we have always kept our vehicles in pretty good shape. I am not going to factor in the cost of tire rotations or oil changes in either the buy or lease example because the costs should be the same. Whether you own or lease they need to be done and the price is the same.
To buy the same car I am going to use the Edmunds True Market Value data which reflects the average selling price in this area for that car. In this case it is almost identical to the captalized cost figure on the lease which means technically whether you lease or buy the best you are going to do for this make and model is about $15,200. Interest rates exhibit a wide spread. Honda does offer a 0% deal but it’s for recent graduates which most won’t be able to get. Bankrate.com reports the average 5 year rate on a new car purchase is 5%. Alliant Credit Union runs around 3% and for this example I’ll assume that rate. You should be able to find a 3-4% rate with a local credit union. With the exact same amount out of pocket as the lease the monthly payment would run about $300. The total amount paid would end up being $16,733. According to Edmunds the market value on a 5 year old Civic in average condition assuming 12k miles per year and that you sell it yourself is $6200. If you trade the car in to the dealer you can expect around $5,000. After 5 years you would have spent $10,533 to drive and finance the car, not including major repairs like tires, brakes and any other non-warranty items. At 60,000 miles you can expect to spend at least a $1,000 or so for these types of fixes but I’ll actually leave that out for now. Taking the total figure and dividing it by 60 months the montly figure is $175.55 to buy versus the lease of $190.67. If you end up trading in your 5 year old car versus leasing it the costs of leasing are actually less per month. If you factor in repairs in years 3-5 it’s absolutely less expensive to lease. This of course assumes several important points. First that you do not intend to keep the car for more than 5 years. If you are the type of person that drives a car until the tires fall off there is no doubt buying is less expensive as you get to years 6, 8, 10. If you trade your cars in every 3-4 years you are probably better off leasing. If you destroy your car with dents everywhere, never wash it, tear up the seats and everything else you should not lease. I will discuss the actual lease process in the next installment in a few minutes.
If we were to run the numbers on a 3 year purchase versus the same lease the monthly costs of leasing would be much lower. Likewise if we ran the rates based on a 5% loan leasing would be end up being less. For the above examples I assumed a super preferred credit rating which is the rate that all advertisements for cars feature. This would mean a credit score of around 680-700+ on a site like myfico.com which gives you the regular Fico score. Keep in mind car finance companies use the auto-enhanced version of FICO scores which weights your payment history on cars higher than the regular model. To view the specifics of the car in question you can visit the current offers page on Honda’s site. I used Alliant Credit Union for the loan rates, you can view the details on Alliants site. Alliant is a great Federal Credit Union anyone can join. There are a bunch of member organizations that if you are already part of qualifies you for membership. If not you can donate to dozens of other groups and become a member. One other note on the figures given in this example. Many car company finance sites do not do a good job of factoring in the current special. If you take a look at the Honda Civic DX-VP you will see that the 36 month lease shows up as $303 a month on the site. That’s because Honda is kicking in the other $160 to bring the monthly payment down to the $139. You can play around with the payment estimator to get a feel for what the other Civic models may cost to lease knowing you can knock off at least $160 per month on those models, sometimes more from what the calculator would give you.
The Whole Shebang: Salmon, Service and an article by Scott Stratton
Posted by: | CommentsWhole Foods is my saving grace. A supremely ridiculous 2+ hour commute leaves me walking through the doors – with my 22-month-old daughter in tow – somewhere around 6:30 pm.
If it wasn’t for Whole Foods and its heavenly prepared foods, I would be forever making Lucy wait until 7:00 pm or later for her dinner.
Now, I have a whole new reason to love Whole Foods.
They recently ran a special – Salmon for $5.99/lb. I watched as the Salmon was wrapped in their ubiquitous brown paper, bundled up and labeled. What I didn’t watch was when it was rang up as Trout for $11.99/lb.
I don’t particularly care about $6, but thought they should know in case this wasn’t just a one-time mistake. I logged onto the site, shot off a pleasant just-letting-you-know email, and literally my phone rang back at me.
They thanked me, because as it turns out, the ‘Salmon’ button had been transposed with the ‘Trout’ button, and everyone was being charged $11.99 for the $5.99/lb fish. No one else had noted the error.
They also encouraged me to come introduce myself the next time I went in so they could refund me, or pay me back in some other way.
This experience was by far the best experience I have had with a customer service issue at a major corporation. It certainly reinforced my loyalty to Whole foods, and, in fact, I feel guilty that I ran into Stop n’ Shop for milk yesterday. (Whole Foods is 30-miles away…give me a break!)
Scott Stratton, president of UnMarketing, had a similar experience at the Hilton Garden Inn. His article “Caring About Your Customer Service Screw-ups” shows just how important it is to actually care about a service problem, rather than to just read from a scripted, corporate apology.
Sure, there will be always be customers who complain just to get something for free. There are unsatisfied customers who threaten to Tweet about their sub-par experiences. There is a world full of miserable Yelpers who, really, just need a hug.
But going above and beyond to address service a faux pas is just another way to ensure that your customers are receiving a holistic brand experience at every touch point.
Or, rather, a Whole brand experience? No?
Marketing is so “in” this season: The do’s and don’ts of seasonal marketing
Posted by: | CommentsOn this lovely 17-degree day, I heard two radio commercials – in a row – that I could have done without.
The first, for wiper blades. “The snow, sleet and rain aren’t over yet…”
And the second: “The first signs of Spring. The first robin. Spring training on TV…”
I could have done without both of these ads not because I’m bitter about the, well, bitter cold we’re experiencing right now. It’s not because it feels like ages before I will catch sight of a robin other than myself.
One reason I could have done without these ads is because they made me feel schizophrenic – are both winter and spring simultaneously knocking at my doorstep?
But the main reason why these ads rubbed me the wrong way is because I know that I need good quality wiper blades to survive a New England winter. I am aware of the snow and the sleet and the rain. Well, aware, my friends.
I am also aware that the Spring brings birds and baseball.
What I am not aware of is what snow and sleet and birds and baseball have to do with YOUR product. I know I need high-quality wiper blades. But why do I need yours?
And this is what peeves me about seasonal marketing: people know why they need certain products or services during certain times of the year. You will never have to sell a person on the merits of doing their taxes during tax season or buying a snow shovel during snow season.
What you need to sell a person on is your product and why it is the best choice for the chore. Just because more snow is on the way doesn’t make your wiper blade the obvious choice.
Want some advice on how to best leverage the four seasons in your own marketing strategy? This Engage Marketing article has some simple advice on how you can make the most of March Madness, April showers, and May flowers.
Have your people call my people: brand marketing via phone lines
Posted by: | CommentsThere are many things in life that I will never understand. Men. Quantum physics. And why every time I call an 800-number I am on the phone for a minimum of a half an hour before I even get a human on the line.
I will never understand why the first human who gets on the line always has to transfer me to another human.
I will never understand why I always get disconnected during the transfer process. Or why I need to explain my situation 17 times throughout the duration of the call.
The only thing I do understand about dealing with a call center is that it kills that brand for me.
BRANDWEEK.com published an article about this phenomenon. Aptly titled, “Feel Like Losing Customers? It’s Your Call,” argues for more involvement from a company’s marketing team in the management of call centers.
I recently wrote about the value of employing the Unify-Simplify-Amplify approach to brand marketing. The call center is a part of this strategy: its employees should understand and believe in the brand – as they represent the brand at a key touch point…the phone lines.
There is nothing more frustrating than listening to a canned apology from a call center representative at a company whose brand promise is to deliver exceptional customer service. Except maybe waiting on hold to be transferred to a supervisor for over 45 minutes, then being disconnected, and having to start the process over again from scratch.
And there is nothing more frustrating to a marketing department than busting their butts and spending million of dollars to communicate the promise of “exceptional customer service” only to log on to Facebook and see, “Terrible upbeat piano music while on hold with the [Brand X] customer care center. Seems like throwing salt on the wound.”
No, the salt on the wound is the 47 comments beneath the Facebook post, all of them complaints about the customer service at Brand X.
Maybe marketing departments don’t understand the technology behind a call center. But call centers don’t understand brand marketing.
And it’s more than just call centers. After a particularly grueling wait time in a Dunkin’ Donuts drive through I updated my own Facebook status. Something to the tune of, “Been sitting in the Dunkin’ Donuts drive through for over 20 minutes – and there are only two cars in front of me!! Must be tougher than I thought to pour a cup of coffee…”
Every touch point with your target audience needs to convey your brand and its promise. Whether the touch point is a call center or a billboard or a Facebook page or the drive-through line, you have to get it right or your marketing dollars are being spent in vain.
Unify, simplify, amplify. There, we just helped you save $100,000.
Posted by: | CommentsIt may be a philosophy employed by the world’s biggest and best brands, but that doesn’t mean the Unify-Simplify-Amplify approach isn’t appropriate for your small- or mid-sized business.
Any business can – and should! – heed this advice. It is, after all, valued at over $100,000.
In his recent article, Carbone Smolan creative director Ken Carbone, expounds upon his expensive advice.
Unify. Know who you are and believe it.
Simplify. Create a clear and compelling message.
Yes, sure. Most businesses do these things. What most businesses don’t do, is the third step.
Amplify.
“To optimize design and marketing dollars,” says Carbone, “brands need to work consistently and strategically to activate all touch points with target audiences.” He uses the Lego brand as an example. “Walk into any lego store, and you can feel the unified brand message, from each individual Lego brick to the holistic constructive creativity in the space.”
Maybe Lego has a bigger budget than your small business does. Just maybe. But businesses of any size can be resourceful in the way they communicate their brand across all touch points. Community involvement, inexpensive promotional items, and public relations. Social media and email marketing. These are all very low-cost marketing channels that your business should be using. And, in the end, the consumer’s actual experience with your brand must live up to – no, it must surpass – the expectations your marketing has set.
You can’t amplify until you unify and simplify. But please, amplify. Bring your brand into every one of your target audience’s touch points in a big way. There is a reason that the most amplified brands are the most successful – and it’s not because they actually spent $100,000 on this advice.
Roses are red, violets are blue: Valentine’s Day advertising goes to the zoo
Posted by: | CommentsIf you are of the school of people who believe that Valentine’s Day is a “Hallmark Holiday,” then I’m on your team. Sure, it’s nice to dedicate a day to the celebration of love, but we’ve far passed the point of flowers and a thoughtful card. Advertisers hawk cell phones, pizza, car, sneakers and, yes, even the zoo, as Valentine’s Day must-haves.
As a marketing professional, I don’t complain that Valentine’s is a “Hallmark Holiday.” Rather, I embrace it much the same way love-struck love-birds embrace each other on this most arbitrary of days.
You gotta get into the Valentine’s Day game, somehow. And you gotta do it in a way that gets seen and heard above the rest of the pink-and-red clutter out there.
This year, the Valentine’s Day marketing that I heard and saw most clearly was (surprisingly) for National Public Radio.
NPR devoted a whole microsite to the holiday, but instead of shameless self promotion, they gave visitors something of use – Valentines.
Not only were these free electronic Valentines that they encouraged us to use on Facebook, Twitter and other social media sites, but they were really cool. The design was modern, the messages were funny, and the branding was minimal – a subtle NPR logo on each Valentine did the trick.
NPR, you are a diamond in the rough. While Verizon tried to convince the world that a cell phone was the new bouquet of roses and State Farm went with fire insurance (you know, from all the candles that would be lit…), you decided not to sell anything, but rather, to give it away. And in doing so, your barely-branded Valentine’s were the hit of the social media world.
As for the companies who took the hard-sell approach, Teleflora’s Super Bowl ad was arguably the most memorable. Check out other interesting Valentine’s Day advertising approaches in this BrandChannel.com article. Make sure to check out the Bronx Zoo’s unique public relations stunt – this one may just have been blinded by love.
To do or to hire, that is the question
Posted by: | CommentsWe are exposed to over 3,000 marketing messages daily. But this does not make us all experts on marketing.
Unfortunately, many people beg to differ. Specifically, entrepreneurs and owners of small businesses who are under the impression that they can develop and implement marketing strategies without the help of an expert.
In rare circumstances, entrepreneurs and owners are marketing experts. But they are also accounting experts, finance experts, operations experts and human resource experts. Their marketing plan doesn’t get the attention it deserves. Neither do their accounting, finance, operations or human resource departments.
Some entrepreneurs and small-business owners hire individuals to focus solely on marketing, which is great. Others try to do it themselves. In reality, a balance of internal and external marketing personnel is just the right recipe.
This Marketing Trenches article, “Marketing Your Startup: Do it Yourself or Done for You?” encourages small business owners to ask themselves five questions:
1. Do you, or does someone on your team have a well-rounded marketing background?
2. Does someone on your team have the time to dedicate to marketing?
3.Does someone on your team have a passion for marketing?
4. Does someone on your team have access to resources to execute an organized plan?
5. Does your company rely on word-of-mouth marketing? Or does it rely on a comprehensive marketing strategy?
In my experience, I see small businesses with potentially great marketing ideas that need to be refined into ideas that will effectively reach their objectives. The dentist who says his practice is “like a spa” when no rational being would ever be swayed by a dentist telling them their practice is “like a spa.” The message here is that getting your teeth whitened or straightened can make you feel confident about yourself.
I see small businesses who believe their unique value to be one thing, while the masses believe it to be another. The technology company who says that their customers value the personal relationships they build while what they really value is not having to think about how their IT infrastructure works.
I also see marketing experts who want to go so abstract that any resemblance of a message or value is lost.
Sometimes, small businesses can’t see the forest from the trees. Sometimes marketing experts can’t see the trees from the forest.
But together you can develop a marketing plan that addresses the forest, the trees and your customers.
Big things come in small packages.
Posted by: | CommentsSmall businesses who manage their marketing in-house often find this: a lot of big ideas that sit…and sit…and sit…on their desks until their windows of opportunity have been closed and locked.
Big ideas are sexy. Everyone has visions of grandeur for their own businesses. But big ideas require a lot of time, money and resources to implement, and most small businesses don’t have a lot of time, money or resources.
There are plenty of less time-money-and-resource consuming changes that can make a big difference for small businesses. The Entrepreneur.com article “Small Marketing Changes With a Big Impact” (November 23, 2010) discusses seven ways to positively impact sales without significant financial investment.
In brief, the seven recommendations are:
1. Put a Twitter link in your email signature. I would add-on to this recommendation by including a Facebook, LinkedIn or YouTube link if it makes sense.
2. Turn the back of your business card into a promo. If you’re giving someone a business card, you have their attention (at least SOME of it…). Include a coupon, free service, photo…anything to help communicate key values of your business.
3. Revamp your website. You may have a beautifully designed website, but if it doesn’t compel visitors to act, then its beauty is in vain. Making small changes, such as adding an email list sign-up box or a White Paper download, can help your website better engage with visitors.
4. Position yourself as an expert. I LOVE this recommendation because there are so many different ways to do it. Social media, blogging, White Papers, short tips & tricks snippets. Anytime you can give advice – without a push for a sale – is an opportunity for prospects to find you.
5. Swap lists with sites that have similar demographics. This can also work with other local companies with similar target audiences. I usually suggest the I’ll-show-you-mine-then-you-show-me-yours technique. Feature your partner in your next email or e-Newsletter and offer to broadcast it to their email list, also.
6. Get a vanity phone number. I don’t know that this is very relevant for businesses who do most of their communicating online, but can see how it could be valuable to some industries.
7. Test, measure and test again. Google Analytics is a free tool that gives you all the information you need to understand your consumers, their traffic patterns, what information best resonates with them, etc. etc. As you make changes to your marketing and website, you will be able to see which ones are working…and which ones aren’t.
Not every marketing initiative your business undertakes needs to be a major one. Sometimes the best things come in small packages.
Oh, brand loyalty, how we will miss thee
Posted by: | CommentsThis just in. A mere 3% of Generation X and Generation Y are loyal to a particular brand. Instead, Gen X and Y’ers are loyal to – wait for it – products that actually satisfy their needs.
In the BrandChannel.com article “Tracking the Generational Shift in Brand Loyalty” (February 8, 2011 05:00 pm) author Barry Silverstein says that, “the economy, in combination with online access to a wealth of brand information, reviews and customer comments, is changing the notion of brand loyalty” for consumers between 25 and 49 years old.
This is, perhaps, one of the reasons why consumer insights have become so fundamental to the art and science of advertising. Providing consumers with what they are looking for – with what they need – has grown to be as important as providing them with a brand they can connect with.
Now, companies need to not know but to understand two things:
1. The connection of their consumer with their brand
2. The connection of their consumer with their products or services
And they need to take their understanding of these things and translate it into their marketing, operations and/or manufacturing.
As a photographer, I had always shot with a manual Nikon FM-10. A bulky manual camera with no flash isn’t really conducive to documenting late-night karaoke at the Cathay Center, so I bought a Nikon Coolpix. I bought it because it was a Nikon. And because Kate Moss was the spokesperson at the time.
I exchanged the camera for a Canon PowerShot in about a week. The Nikon took forever to take a picture, and once the shutter did decide to open and close, what it captured was dull and blurry. I checked out online reviews before choosing my next camera, and it seemed the PowerShot was the product for me. And it was – it took great pictures quickly, so I never missed those once-in-a-lifetime moments that can only happen when you’re 21 and single.
In hindsight, maybe I should have kept the Nikon…
But the point is that my loyalty became null and void once I found a product that satisfied my needs. I’m sure the Nikon Coolpix offered benefits that the PowerShot didn’t – but they weren’t the benefits I needed. And Kate Moss wasn’t enough of a reason to keep a camera I didn’t love – it’s not like I would have ended up looking like her had I not exchanged it.
Now, consumers have no choice but to research products and services before purchasing. Advertising has always made grandiose claims, but never more so than now. Every brand waxes poetic about how wonderful their products are, but the “walk” rarely lives up to the “talk.”
It is more important than ever for the experience of both our products and brands to satisfy the needs of our consumers. But to do that, we really need to understand what their needs are. What they need out your product, what they need out of your brand. And, the same way that consumers research our brands and products – via the Internet – we can research our consumers needs. Yelp, Facebook, Twitter and about 1,000 other websites exist for back-and-forth banter about any product or service imaginable.
Consumer research can cost millions…but it doesn’t have to. Being resourceful and leveraging free tools on the Internet can provide you with all the insight you need to improve your marketing and improve your products or services.
