I don’t mean price.  I mean saving money.  I mean creating value that far exceeds the price of what you sell.

Cisco introduced Telepresence about a year ago: meeting rooms that include HD monitors and video cameras that create a hyper-realistic presence of people anywhere in the world, as long as they are in another Telepresence room.   At a price of $100,000 to $400,000 per room.  Not an inexpensive proposition.  Yet, these babies save money by reducing travel.  And saving money is at the beginning, middle and end of every sales message Cisco sends.  As it should be.

Telepresence is also a huge “gotta-have” for egotistical top management at big companies.  But Cisco doesn’t position it this way; as leading-edge technology for leading-edge companies.  Save me money and I’ll buy from you.

Pentair introduced a variable speed pool pump.  You can set it to run longer, at a lower horsepower level, with short full-power intervals.  The bottom line, you’ll spend 90% less on electricity to keep your pool clean.  For me, that saves $90 a month.  It costs $2,200 (a premium for pool pumps) and pays for itself in less than two years, after rebates.  Save me money and I’ll buy from you.

The pump also has other important benefits.  It filters your pool water more effectively, maintains water chemistry better, you’ll end up using fewer chemicals and a pump running at lower RPMs lasts longer.  But Pentair puts cost savings front and center in every sales message.  As it should.

Here’s another great thing about the Pentair saving money positioning.  In the history of swimming pools, you replace your pump when it breaks.  Now, it makes sense to toss your current  pump and start saving money!

Figure out how what you sell saves people money.  Show it.  Demonstrate it. Prove it.  Start with it.  Makes sure it’s front and center.

Does this apply to everyone?  No.  Frankly, there may not be a good argument for how what you sell saves money.  I’m not sure how you demonstrate that buying a $100K Steinway piano saves you money, for example.   And no, “it’s the last piano you’ll every buy” doesn’t work (see “tortured logic” below).

My advice here is consider how you can collaborate with another company to demonstrate a cost savings.

But here’s the deal.  It needs to be real, not a stretch.  You can’t just change your headline.  No tortured logic either, please, just because I say it’s important.  Get feedback and input from customers to help you craft your money-saving message.

Then show it.  Demonstrate it. Prove it.  Start with it.  Makes sure it’s front and center.  And, save me money and I’ll buy from you.

It’s simple, really.  You see, regrettably, I don’t know everything.  When I take something as far as I can and I’m still not happy with the results, I look for someone a bit farther down that road than I am.  Enter, Ian Lurie.

Ian has Portent Interactive and writes the blog Conversation Marketing.  I’ve been following him for a while and like what he says and his practical approach to solving problems.  I hired Ian and his team to refine my website and user experience.  Specifically, encouraging more visitors to become clients.

We’re  knee-deep into implementing his suggestions.  I’ll continue along these lines until what he says stops working.  It’s been an interesting process, one I thought I’d begin sharing. . .with the hope and expectation there will be a happy ending.

I hired Ian for another reason.  This economy isn’t like anything I’ve seen and I’ve competed in some pretty nasty distinct economic conditions.  This is not a time to hesitate for even a week.  Too much uncertainty.

If I’m right, I’ve avoided lost revenues during the months it would have taken to solve my issues without him.  If I’m wrong, and I could have figured it out without him, worst case, I’ve invested some money, gotten smarter and arrived at my destination a bit sooner as a result.

Stay tuned. . .

In today’s economy it might be said this way: convenience is the enemy of getting results from your marketing.  Okay, not nearly as catchy, but true.

The convenient marketing methods, the strategies we know, the things that have worked for us in the past, aren’t the solution.  Today people are in a fundamentally different place emotionally and, in some cases, financially as well.  This certainly changes why they buy and in some cases how the buy.  Have your marketing methods and message fundamentally changed too?  It’s not convenient.  It’s not comfortable.  But it just may well be necessary for you to move forward.

As a marketing consultant for small business I see companies  in this quandary: “We’ve tried what we know, so now what?!”  Actually, it’s rare when I’m invited in in any other circumstance.  I know, lucky me.

The first thing I do is talk to my clients customers.  I find out what’s going on in their world, how they’re feeling, what they’re thinking.  The first thing I have the client do is answer the following question: If you were starting your business today, fresh, what would that look like, what would you sell, who would you sell to and how would you sell?  Unencumbered by everything that you are literally and figuratively invested in, what type of company would you start?

Those things inform how the message ought to fundamentally change, how the  marketing methods ought to fundamentally change and if a client’s value proposition ought to fundamentally change.

My experience:

Most of the time the message needs to change.  After all, the reasons why people buy today have changed, so should your message.

Some of the time the marketing methods need to change.  Usually, methods need to be added.  It’s rare when I find a company maximizing its website traffic or conversion, and even rarer when they have a presence in the social media space.

Occasionally a client’s basic value proposition needs to change.  This is potentially the most painful since it requires you change, to some degree, who you are.

You can do this (talking to customers, answering the “what if you were starting your business today” question) or you can have someone like me lead you through it.  But you need to do it.  Convenient?  No.  Critical to your moving forward?  Yes.

I’m a small business marketing consultant who’s called into every conceivable situation, good and bad.  GM has many issues I don’t know about or probably wouldn’t understand if I did that have made the slowdown in demand for cars so devastating.  However, two things have been painfully obvious: if they hadn’t been so married to the profits in big SUVs and trucks, they wouldn’t be in this mess; if they hadn’t been acting in such half measures these past few years, they wouldn’t be in this mess.

Is there a person in American who couldn’t have told GM three years ago the obvious, that the era of big SUVs is coming to an end?  How long ago was gas over $4/gallon?  How long ago was there a waiting list to buy a Prius?

Lesson #1: Embrace reality.  Your marketing will improve if you do.

I don’t fault GM for selling people big SUVs.  I fault them for not at the same time creating a “moon shot” program to develop the types of hybrid and electric cars people wanted and want to buy.  They might argue they have done this.  They haven’t (see Lesson #2 below).  If they had we wouldn’t be having this conversation.

Now, forget about GM, they may be too large to fail, but you aren’t.  Nobody’s bailing you out.  So, embrace reality.  If people haven’t slowed down buying what you sell, but the writing’s on the wall that they will, get busy with Plan B.  What will they buy?  Start developing or sourcing that.  Don’t wait.  That’s the GM lesson.

Lesson #2: When you act to solve a marketing problem, make sure you solve the problem.

I heard a GM spokesperson on TV talking proudly about how many cars they have that average over 40 MPG and touting their new hybrids.  That’s just pathetic.  First, nobody’s buying those 40 MPG cars, or we wouldn’t be having this conversation.  Second, GM’s newest hybrids (at least the ones they’re spending millions promoting): Escalade and Tahoe.

If so many good people weren’t losing their jobs because of management’s stupidity, introducing a hybrid Escalade would be laughable.  Seriously, a hybrid Escalade. Gee, is that like low-fat bacon?

So, if you have a problem to solve, make sure your solution is a solution.

I always ask the “zero-based” question at times like these: if you were starting over, right now, in your space, what product would you sell, how would you sell it and who would you invest money in promoting it to?  That’s what you should be doing right now, not introducing a hybrid Escalade.

The answer to the “what product would you sell?” part of that question sounds an awful lot like, in GM’s case, the Chevy Volt, right?  All electric, good range, looks cool.  Except it’s too expensive and way, way late.

Again, if you have a problem to solve, make sure your solution is a solution.  And again, forget about GM.  But nobody’s going to bail you out except you.  So, embrace the reality you’re in, and when you act, make sure you make changes that are big enough to make a difference.  And please, no Escalade hybrids!

Ha!  This happened to me yesterday literally IN MY OWN BACKYARD! 

The question: How to generate sales in a climate of cost-cutting? 

The answer: unbundle your services to lower the perceived cost.

The teacher: Tom, our ex-pool guy turned re-hired pool guy.

The student: me.

The background: About 24 months ago I start writing about “the coming slowdown,” warning business owners and talking about what to do.  About 18 months ago we (my firm) slowed down.  So we took our own advice and cut some expenses: conferences I like to attend; we shopped our car insurance (saved about a grand a year, by the way); and, it pains me to report, let our pool guy Tom go.  We also invested in other areas, but that’s another post.  Tom charged us $115 a month to come once a week to clean and add chemicals (he supplied the chemicals).  I called Tom a few days ago because our filter needed its annual service, to see if he’d do it for us.  He agreed.

He serviced the filter and we were catching up when he simply said, “You know, if you want to supply the chemicals I can put you back on service for $85 a month.”  That’s all I needed to hear and Tom is once again our pool guy, I am relieved I can stop doing a lousy job cleaning our pool and my pool is most certainly rejoicing.

Tom unbundled the cost of the chemicals from his price, putting him back into the category of “things we can afford.”  The reality is under this new arrangement we will likely end up spending about the same for chemicals and cleaning, but  our PERCEPTION is that now Tom is more affordable.  And that’s all that matters in this transaction, or any transaction.

How can you unbundle?  And please understand, unbundling is different than discounting.  I’m not a big fan of discounting.  When you unbundle you change your product or service; you strip something out or break it into smaller pieces to lower the price.

Another take on this same concept: re-configure your product or service.  Again, not a discount.  A different product or service.  And sometimes it’s little more than changing how you think about your product or service.  Two examples:

A client of mine specializes in 2-day in-house business writing seminars.  He’s very good, charges $7,500 for the two days, is working with some of the largest companies in the world and, unfortunately, is experiencing a slow down.  We’re helping him rethink how he can make an impact for his clients in one day.  Not put his 2-day seminar into one day, but how he can deliver value in one day.  Our hope is he can create value for his clients, save them money and very possibly raise his daily fee.

For most of my career the first thing clients have generally hired me to do is create a marketing plan.  And then I typically stick around to implement our recommendations on a monthly business.  Simply put, clients have generally entered into relatively substantial, formalized relationships with me.  As traffic to my site has grown I’ve started hearing from more and more people who don’t want and often can’t afford the larger relationships.  Now, a $500 retainer gets us working together tomorrow.  I’m doing smaller projects, mainly giving advice, for more clients.  I’m making a difference, my clients are happy and getting problems solved quickly and inexpensively and I’m very likely more profitable on an hourly basis.

In closing, I’ll ask it again: how can you unbundle, how can you rethink your product or service so as to be perceived as more affordable?

When customers are in a crisis they tend to stop buying luxury items but continuing buying things they see as necessities.  Tips to make whatever you sell more a necessity than a luxury:

Modify Your Unique Selling Proposition

People buy your product for a variety of reasons.  Obviously, in a crisis their reasons for buying change.  How can your product save them money?  How can you save them money?  How can you reduce the risk they are feeling? 

Example-  When larger organizations move into crisis the first thing that goes is training.  How do I know this?  I have training clients that sell to larger organizations!!  NO dollars will be spent on non-essential training until further notice.  The question we’ve had to answer (after 9-11 and now) is how my clients’ training is essential.  In one case, business writing, training that is not inexpensive, we have focused on how much time can be saved.  Write 30% faster and business writing training can help an organization get more done through fewer people.

In another case, business acumen training, we’re focusing on need and price.  Based on our delivery model the cost-per-training-hour is very low.  Also, it’s more important than ever right now for employees to make better business decisions.  Business acumen training addresses exactly that.

One client is working on their biggest order in company history.  The other, a start up, is experiencing real traction on the message and is hearing “We can find the money.”  Trust me, they can always find the money.

Ask Your Customers

Before you change your message consider talking to a few customers to find out how they are feeling, what language they’re using and how they are being forced to change.  This will greatly improve your chances your new message will fit their new initiative, main concerns, etc.

Change!

This is the toughest, but in a crisis, the alternative may not be an option for you (failure).  If you simply aren’t getting traction with a modified selling proposition and what you’re hearing from customers isn’t encouraging, well, maybe your big, high quality, total service, complete warranty product needs to change.  Please, remember, what got you where you are today may not be what will get you through a crisis. 

Have you ever heard the expression “Don’t get caught fighting the wrong war!”?  Examples are legendary.  The allies were fighting WWI style when Hitler started WWII with the blitzkrieg.  We fought the Vietnam War Korean War style for the first several years.

Let go of the past.  Adapt.  Innovate.  It’s always easier to do it sooner than later.  Example-  For many years the typical model for my new clients is we’d start by doing a marketing plan.  Then they’d hire us to implement.  We’d study the situation, make recommendations and start testing our solutions.

Now, we’re doing a lot more what I’d call micro interventions.  I’ll sit with an owner on the phone and we’ll solve the problem at hand (improve website conversions, revise a brochure, redo an ad).  And guess what?  It’s fun, I’m delivering good value and we’re thriving.

I own three pairs of Ecco shoes.  They are comfortable walking shoes that don’t make you look like a 78 year-old man when you wear them.  At least I sincerely hope that’s true.  Anyway, they aren’t cheap either.  So, when both soles of a pair failed in the same place, even after I’ve owned them for three years–low mileage, I assure you–I thought that was a problem.

So I emailed them and told them of my plight.  Via a customer service form on their site.  I hate forms.

I received an email in less than 24-hours asking for an address they could send a post-paid bag.  I was to put the shoes in the bag for a free assessment of the shoes.  Which I received and which I did.

I received an email in about a week letting me know they were replacing the shoes at no charge.  Expect them in 2-3 weeks.  Have not received my shoes yet, but, Ecco still has a customer.

What they did wasn’t heroic.  It was just smart.  Yet, because so many companies don’t do it, it becomes heroic.

Nordstrom just replaced a pair of UGG boots I bought my wife to go to South Dakota in.  The first touch of snow and they stained, tragically.  She returned them and they replaced them, no questions asked.  Nordstrom still has a customer.

What great reminders that doing the right thing is always the right thing to do.

2-4-09 Update  //  I received a new pair of Ecco shoes today.  Very happy.

Boiled down to the simplest terms I can manage, here is what I learned-

Sell to people for the reasons they are buying.  Your customers are likely buying what you sell for different reasons today than they were 18 months ago.  Understand how your customers’ reasons for buying have changed and adapt your message accordingly.  What’s important to your customers NOW?  Talk about that!

Sell to the people who are buying.  We work with a swimming pool remodeling contractor.  We focused all our marketing on the residential market.  Yet, every year, one or two commercial customers (resort, college, city) would call and ask if they remodeled commercial pools.  About a year ago we started going after the commercial market and thank goodness we did.  Their residential business has slowed as people are slower to remodel their pools during down times.  But commercial customers can’t afford to put off their projects, and that business has been critical to the client.

Said another way, quit beating your head against a wall.  Stop trying to sell to people who aren’t buying.  What type of customer do you have that maybe you haven’t focused on, but who is buying right now?  You may need to change your brochures and website to speak directly to this different type of customer, but that’s a small price to pay to go after customers who are buying.

Sell the way people are buying.  I’m advising a solid company in the heart of the rust belt.  They reached out because things are drastically changing around them.  Their average sale has gone from $60,000 to $10,000, current customers aren’t buying and they’ve identified they must take their business national after being built from the ground up to be a local, face-to-face type company.  They blame the internet.  I said embrace it, sell the way people are buying.  When at one time selling to someone you’d never sat across the desk from seemed impossible, now, the net—phone contact—a sample in the mail—closing the sale on the phone is their customers’ preferred way of buying what the client sells.

Let go of your sacred cows.  This relates to everything I’m saying here.  When things change open yourself up to changing: who you sell to, how you sell, your message, what you sell, etc.  We work with a landscape contractor who built a solid business selling to people retiring into upscale gated communities.  In other words, new construction.  Well, that business has vanished.  Really.  It hasn’t dropped 40% or 50%; it has freaking vanished!  We have been scrambling to focus on the remodel market and replace a super-premium quality message with a more value-oriented message.  His salespeople, however, has resisted the change.  They still want to design and sell a $60,000 masterpiece front yard — their sacred cow — instead of the $15,000 remodel people are wanting now.  Do so at your own peril.

Simplify.  Every time we simplify a website or a brochure or a mailing, sales go up.  My site is a perfect example.   We built a site four years ago to be a portal.  From watching visitor behavior via Google Analytics I trimmed everything back except the most popular pages.  Literally within 24 hours of posting the new site inquiries went up.  All the content I assumed added value to the site also added complexity; and suppressed response.