Not Sure What They Are Selling

I’ve been seeing a number of different car commercials lately, but, other than the obvious, I’m not really sure what they’re selling. Some examples:

  • GM, yet again, is offering employee pricing on its vehicles. This year, they attempt to couch it in terms of an anniversary. This is something they have been doing since around 2000, and they pull the trick out whenever their sales are in the dumps, which seems to be most years. If your vehicles weren’t relevant before, resurrecting a bad sales idea isn’t going to change that. Sell your cars on their merit, not the fact that you’ve been overpricing and underdelivering.
  • VW seems to think that German engineering is best expressed through black Beetle acting as a talk show host. Saying that you have German engineering doesn’t make it good—the engineering itself does, however. Tell me what it means and what I can expect to experience from it.
  • Mitsubishi has introduced a new engine, yet doesn’t feel the need to explain to anyone what makes it unique or at least different. When you spend that kind of R&D money, market the heck out of the result.
  • Ford has introduced a new box on wheels with so-so EPA estimated mileage, touting it as something people should desire. Two things: one, average or slightly above average EPA estimated mileage isn’t enough, you have to do something revolutionary; two, most of us don’t care one lick what the EPA estimates the mileage to be in a vacuum on a treadmill with no friction, we care about the actual mileage from driving on real roads.

When you are marketing a product, no matter what it is, you have to focus on the actual features and benefits. If you don’t have any, save your money and reputation and stop selling it. Focus your energy on creating something that actually creates a point of differentiation. Be unique. Serve a market others ignore. Make a positive difference. But don’t, under any circumstances, try to treat your customers like gullible fools. That is the quickest route to irrelevance.

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Managing Internet Sales

One of the biggest challenges for any company that sells a product is protecting its trademark and MSRP online. It’s even worse when you sell through others, whether they are distributors or retailers (or both).

The best way to maintain the integrity and legitimacy of the brand is to implement a tight policy that specifically addresses how your trademark can and cannot be used and what leeway, if any, you will allow with respect to MSRP—even if it is really Manufacturers Required Retail Price.

Some issues to consider:

  • Is it OK for them to sell on third-party sites like eBay and Amazon?
  • What kind of sales and promotions will you allow them to run?
  • Where will you let them ship? (Continental U.S. only, internationally, etc.)
  • What words can they use for online ads?
  • Do you want them to advertise your product as “lowest price”?

And regardless of what your policy says, you have to be able to monitor and enforce it. And your customers have to know that you’re paying attention. Thank and compliment them on their compliance, and give then tough love when they break the rules.

This is your brand. Don’t let someone else hijack it.

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Compensate for the Right Goals

Last week, there was a story on the news about a guy in Tucson who followed a speed camera van around and held a sign warning drivers the van was there. He reasoning was that there was insufficient notification to drivers that the van was there to catch them speeding. The van is a contract role for the police department, paid, most likely, per ticket issued or collected.

That is the problem.

Follow me on this. The ultimate goal should be speed abatement. In other words, the desired outcome needs to be a reduction in the number of people who speed in a given area. Compensating based on catching people doing something wrong, is going to drive the company to catch as many people as possible doing that thing wrong.

Turn it around and compensate the company for a reduction in speeding, then you will find far fewer people speeding. But doing it that way is much harder. First, you may have the wrong company/employee. Second, you may be taking the wrong approach to reach the desired outcome. Either way, it won’t be the simple way to devise the compensation. That is a guarantee.

When designing a variable compensation system (salary plus bonus, for example) be sure to understand what your desired ultimate outcome is, as well as, and this is critical, what it will take to achieve that outcome is the most desirable manner.

For instance, let’s say you have a sales goal in place. You could compensate based on the employee reaching a certain number. Then their objective is simply hitting that number, doing whatever it takes. On the other hand, you can identify the key steps in the sales process that best match your brand promise and compensate based on the employee successfully achieving those steps, along with the desired overall results. If they do all the steps as they should, and the results don’t follow, you need to change the steps, not the desired outcome. Fix the steps, then start it up again.

In the end, you are going to get what you pay for. Just make sure you’re paying for the right thing.

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Walk the Talk

We’ve been interviewing a number of local PR agencies lately, and I have to say, for the most part, it has been a disappointing exercise. They talk and talk without truly understanding that this is the equivalent of a job interview, and we expect them to be at the top of their game. If someone is looking for a top-notch agency, have your act together and prove it. Let me give you some examples of what we’ve experienced:

  • “Our owners are heavily involved with all of our clients”—Really? They why aren’t they here? If you are going to talk about how involved the owners are, make sure they are there. And if that’s the case, they can tell us themselves.
  • “If you’re just looking for someone to write press releases, I can recommend some other people to do that”—Great! Who are they? Oh, you’re not going to actually tell me. Then don’t say it in the first place.
  • “We can throw somebody at [your project]”—I hope they don’t get hurt in the process. We are looking to hire an agency to support us, not writer’s pool looking to be hurled at the project du jour.
  • “We call you weekly or bi-weekly to give you updates and send you a monthly activity report, because we’ll get in trouble with the owners if we don’t”—Oh, I see. Not because it’s the right thing to do.
  • “We do media relations training”—Then why are you incapable of answering a basic question without stumbling through it and looking to someone else for help. If you train in media relations, pretend you are on the podium and in front of a camera.
  • “PRSA says you can measure ROI by taking the column inches in the publication (or the number of minutes on television), applying the equivalent ad value, and multiplying by three”—Um, no. That is your return on investment not mine. PRSA is an admirable association, but that is not a measurement of a client’s ROI. I measure my ROI by the actual benefit I receive from the PR activity—sales, number of new clients, registrations. If your activity cannot be associated with something truly measurable for the client, you cannot claim ROI. In other words, if their business doesn’t grow, you didn’t offer them a return. And that is OK, if growing the business isn’t an objective.
  • “Other agencies do…(whatever)”—I don’t care what other agencies do. I want to know what you do. I’m talking to other agencies, so I’ll judge for myself what they do. I don’t want to know what you have to say about other agencies unless you are speaking specifically about what a competitor does well that you admire or you are giving me a reason that you left that particular agency that is significantly different at your new one. Even then, be careful what you say.
  • “We told our client to do [this particular newsworthy event]”—We heard this from two different agencies. About the exact same thing. Yep, one was taking credit for the other’s work. I don’t know who was who. At that point, it didn’t matter, since both had several of the problems already mentioned.

Again, when you are pitching potential clients, it is a job interview. You have to be spot on your game. If your heart isn’t in it, if this isn’t the most important thing you are doing at that moment, don’t even bother to show up. It will be less embarrassing that way.

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Ensure Your Customers Are Successful

Here’s a quick question for you. When you sell to your customers, what are you doing to ensure their success? This most likely is targeted to you B2B folks, but it could go to just about anyone selling anything.

Because to the best companies, selling isn’t just about the sale. Or even the repeat sale. It’s about making sure your customers truly are successful in using your product. It’s about building a long-lasting relationship focused on mutual growth.

In other words, when your customers are successful, so are you. When they aren’t, neither are you.

So I go back to my original question: what are you doing to ensure your customers’ success? Train them on how to most effectively use the product. Show them how to price it for resale. Offer them assistance on managing their business. Learn about the results they are getting with your product and why.

Invest in them and their success. It’s what will lead to your own.

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Selling It Back

This past weekend, I heard a co-worker talking to a customer, and she said she didn’t want the customer to sell the product back to her. I hadn’t heard that phrase in several years. But it’s one of those that makes perfect sense.

We sell all sorts of things to all sorts of people. It doesn’t matter what business you’re in, you are selling something to someone. The key is selling the right person the right product, not selling just anybody everything you’ve got. Why? Because if it doesn’t do what you promise or meet their needs, they’re going to sell it right back to you. And it’s going to cost you more than it cost them.

For you to be successful in your business, you need results—the positive kind. Over the long-term, those results need to come from taking the time to make the right match of product and consumer. Satisfied customers typically don’t sell their purchases back. But when they do, that is your opportunity to sell them the right product.

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The Challenge of Segmentation

Segmentation is a difficult thing to wrangle sometimes. When internet-based sales starting picking up steam ten years ago, people weren’t sure how to respond, though the thought process really shouldn’t have been much different than for catalog sales. The main difference is that the catalog was now online and accessible to anyone who was interested.

What the internet, and catalogs for that matter, gives you is another channel for selling to customers, even if the audience is different. Thus is the challenge of segmentation. The essential question is this: what do you offer to sell people, where and at what price? OK, maybe it’s three questions. Regardless, there are four basic ways to segment your offering:

  1. Selling the same brand, with the same features and pricing, through different channels—You offer the same thing online or in a catalog that you do at retail for the same price.
  2. Selling the same brand, with differing features and pricing, but through the same channel—Your retail offerings for the same brand are priced differently, based on the features.
  3. Selling the same brand, with differing features and/or pricing, through different channels—What you offer online is exclusive to the channel and different than what you sell at retail, even for the same brand and similar product.
  4. Selling the same product, with the same features, different pricing and brand names, through the same channels—You offer the same product with the same features and through the same channel (online or catalog or retail) but under different brand names.

What’s going to work best for you depends on the product you sell, the channels available to you and your customers and how effectively you can manage the process. A major concern will be how the channels (or brands from option 4) compete with each other and cannibalize sales. Sometimes, none of these options make sense as there is only one way to sell your particular product.

But make no assumptions. Explore the options. Do some tests. See what makes the most sense. And most importantly, sell to your customers where they are, at the price they expect to find and with the features and benefits that deliver on your brand promise.

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