I met with a business owner recently who told me his business trends for 2009 are abysmal. He is worried, and wants to do something quickly to improve near-term results.; We discussed a number of options he could take.

His favorite idea is to print a new brochure and distribute it at local stores by forming partnerships with retailers.

My initial comment was that the retail partnerships mightwork, but they won’t work quickly. It will take some time to form the partnerships with retailers, then additional time to get the stores to display his brochures and support the program; this stuff never happens as fast as you think it will.

I then noted that his business only serves 1,000 customers each year, even in good years, with very high customer satisfaction. Although he enjoys good repeat purchase rates, his customers aren’t buying his product as many times as they could. I suggested that the quickest way to develop business is to call past customers, have a good conversation with them, then invite them to do more business with you.

“No, I don’t want to do that,” he said. “They’ll come back anyway. They love us. And, besides, we only have 3,000 or 4,000 customer names. I can distribute 10,000 or 20,000 brochures really quickly. That’ll work better, because I can reach more people.”

My comment: “Your business is not a slot machine.”

Sending out a pile of brochures is like pulling the arm on a slot machine many times– you’re hoping that luck will go your way and that, after enough attempts, you’ll win something. Like placing advertising, you have much control over the input but very little control over the output.

Revenue generation doesn’t need to be a game of chance.

If, like this executive, you are assessing ways to use marketing to improve business results, play the slot machines last. Focus first on things that are more deliberate, known and controllable.

  • Focus on direct interactions with customers first, then use marketing media, such as brochures, ads, news stories and websites, as a supplement to these direct encounters.
  • Focus on past customers first, then seek new customers.
  • When looking for new customers, focus on your customers’ friends and colleagues first, then look for people with whom you don’t even have indirect connections.
  • Don’t be misled by numbers; distributing 10,000 brochures isn’t inherently more effective than having quality conversations with 100 customers.

The more direct the customer interaction, with the least media involved, the less you will be leaving things to chance.

Also, the more you focus on customers who already know you, or the friends of your customers, the less you will leave to chance.

Traditional marketing is often a game of chance, for these reasons:

  • Its reliance on “getting the word out,” as opposed to directly motivating a customer.
  • It’s about sending the same message to many people, reducing the chances that your message will connect with any one customer.
  • Its heavy use of media between a company and its customers.

But, even though you’d like to reduce the element of chance in your marketing efforts, do you need to keep dropping coins in the marketing slot machine? Sure, for a number of reasons:

  • You may need to generate leads from customers who don’t yet know you.
  • It’s impossible to interact, one-on-one, with every customer or prospect.
  • You may want to experiment with new marketing tools.

But the slot machine can’t be the foundation of your marketing plan. First focus on efforts that are more deliberate, known and controllable.

One of my least favorite aphorisms is the old saw, “50% of my advertising works, but the problem is that I don’t know which half that is,” because it gives executives the leeway to say, “Oh well, marketing is just guess work. We better just increase the budget, get the word out, and hope enough business comes our way.”

No. We don’t need to think that way. Our businesses are filled with sensible, deliberate business-generation opportunities. Will they all work? Of course not. But we don’t have to look at marketing and revenue generation as games of chance.

Take Notice

Consider how companies market and sell to you. How many of these communications are nothing but games of chance, where the company is communicating with you at the same time they communicate with hundreds, or thousands, of other people, just hoping some small portion of people will respond positively to their message? Do you feel like a dartboard?

How do you compare?

What about your company? What portion of your sales and marketing efforts are like slot machines, where you have great control over the input but little control over the output? Are these games of chance the foundation of your marketing and sales efforts, or are they supplemental to more deliberate, known and controllable efforts?

Draw a horizontal line on a piece of paper. Write “Game of Chance” above the line at the left side of the paper. Write “Focused Effort” above the line on the right side of the paper. Now, write down your company’s major marketing and sales strategies at the appropriate place under the line.

  • If you have a program where you make personal calls to customers the day after they purchase, that would go on the right side of the paper, under the line.
  • If you sponsor a little league team, with your name on the jerseys, write that down on the left side.
  • Sending out a newsletter like this, where people have opted-in, but are still hearing from me as part of a large group, goes somewhere in the middle; it’s not a complete game of chance, but I’m still not able to have the personal contact I’d like to have with each of you. (Of course, if you’d like to have that personal contact, give me a call at 847 686 0400. I’d love to write your name down on the far right of my piece of paper.)

Try this

Look at the list you made, contemplating the various marketing and sales efforts written on this piece of paper, spread from left to right across the page.

Pick out three efforts that are on the left half of the piece of paper– those that are more “chance” than “focused.” What can you do to remove some of the element of chance from these efforts? Or, can you replace them with other efforts that leave less to chance?

Generating revenue and profits is a key function of your business, isn’t it? Something this important shouldn’t be left to chance.

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