Saturday, October 9, 2010

What’s Your Capo d’ Astro Bar? A little more marketing wisdom

Huh? What’s a Capo d’ Astro Bar? Let me tell you a story.

A company that had been making pianos for many years hired a new marketing manager whose job was to “do his thing” to increase sales. He soon discovered that his company’s pianos were equal or better than the competitor’s in almost every way. Their prices were also comparable to the competition’s. But he also discovered that his company’s sales were well below that of the competition. After further investigation, he found that it cost his company almost twice as much to ship their pianos and that price difference was driving sales down.

He walked out into the shop and asked the long time shop foreman why it cost almost twice to ship their pianos. The old foreman answered, “That’s because our pianos weigh almost twice what everyone else’s weigh.” When he asked why that was, the answer was, “That’s because of our Capo d’ Astro Bar.”

Of course his next question was just the same as yours, “What’s a Capo d’ Astro Bar?” The foreman got one of those creeper dollies that most car repair shops use, put the Marketing Manager on it and wheeled him under one of the pianos. “See that heavy cast iron bar under there? That’s the Capo d’ Astro Bar and it weighs about 300 pounds.”

He went on, “Our Capo d’ Astro Bar keeps the frame from giving under the tension of the strings. It keeps our pianos in tune about five times longer than any other piano and it means that the customer can go about five times longer before he has to pay to have his piano re-tuned.” “No other company has anything like our Capo d’ Astro Bar,” he added.

That was the “ammunition” the new Marketing Manager needed. His new marketing campaign told customers about the Capo d’ Astro Bar and how it would save them money. Over the life of the piano it would save them hundreds of dollars in tune up charges and would more than make up for the initial extra shipping charges. Sales soared.

In the world of Marketing you will hear the term Unique Selling Proposition or USP. I prefer the term Capo d’ Astro Bar. In a strange way, it is easier to remember Capo d’ Astro Bar than Unique Selling Proposition.

So let me ask you again, “What’s your Capo d’ Astro Bar?” Look for whatever is unique and different about your product or service. If you don’t have one, think one up. Then use it to increase your sales.

Thursday, September 30, 2010

Guerrilla Marketing Part 3

A few years ago I attended a business class at the local Adult Education campus and one of the guest speakers asked us a very provocative question. “How do you beat the competition?” The class offered, “Lower prices.” “Faster delivery.” “Better quality.” “Greater selection.” and “Friendlier service.” The lecturer then said, “Yes, those are all good answers but not the one I am looking for. The way to beat the competition is to change the rules - and then don’t tell them what the new rules are.

At first this could sound like a superficial answer but it’s not. I have used that idea ever since in the guerrilla marketing that we do. Here’s one way.

Periodically we do an anonymous survey of our competition. (And we assume that they do the same thing to us.) We send out a request for quote and then compare their response to what ours would be for the same work. Of course we compare their prices with ours. We also compare several other things. We want to know how their promised delivery compares to ours. We compare how their response to a request for a quote compares to ours. And there is one other aspect we compare that I’ll talk about later.

The last time we conducted a survey, this is what we found. Some prices were lower than ours. That’s fine with us because we do not want to have the lowest prices in town. (That’s the worst way to compete.) Most of the delivery quotes - how soon a customer gets the finished product after he places the order - were about equal to ours.

Then we got to response time - how soon they got back to us with a quote. The fastest response was about ten days after we sent our request. Our policy is one that reflects the idea of changing the rules and not telling them what the new rules are. We respond to 90% of all requests within four hours; 100% within 24 hours. Why is this important? It’s a human trait. When we want something - whether it’s a new car or a new house or even a haircut - we want it now, not two weeks from now. With our four hour response time we frequently have quoted the customer, got the order, produced and shipped the product before our competition has even responded with a quote. Talk about changing the rules!

Now one of the last things that we compare between our competition and ourselves. When we send out the request for quote, we include a small mistake of some kind - a misspelled word, a broken line, something. When the competition responds, we look to see if they bring that to our attention. The competition never does; we always do. We are sure our customers appreciate that.

Change the rules and don’t tell them what the new rules are.

Friday, September 17, 2010

What's Your Capo d' Astro Bar?

Huh? What’s a Capo d’ Astro Bar? Let me tell you a story.

A company that had been making pianos for many years hired a new marketing manager whose job was to “do his thing” to increase sales. He soon discovered that his company’s pianos were equal or better than the competitor’s in almost every way. Their prices were also comparable to the competition’s. But he also discovered that his company’s sales were well below that of the competition. After further investigation, he found that it cost his company almost twice as much to ship their pianos and that price difference was driving sales down.

He walked out into the shop and asked the long time shop foreman why it cost almost twice to ship their pianos. The old foreman answered, “That’s because our pianos weigh almost twice what everyone else’s weigh.” When he asked why that was, the answer was, “That’s because of our Capo d’ Astro Bar.”

Of course his next question was just the same as yours, “What’s a Capo d’ Astro Bar?” The foreman got one of those creeper dollies that most car repair shops use, put the Marketing Manager on it and wheeled him under one of the pianos. “See that heavy cast iron bar under there? That’s the Capo d’ Astro Bar and it weighs about 300 pounds.”

He went on, “Our Capo d’ Astro Bar keeps the frame from giving under the tension of the strings. It keeps our pianos in tune about five times longer than any other piano and it means that the customer can go about five times longer before he has to pay to have his piano re-tuned.” “No other company has anything like our Capo d’ Astro Bar,” he added.

That was the “ammunition” the new Marketing Manager needed. His new marketing campaign told customers about the Capo d’ Astro Bar and how it would save them money. Over the life of the piano it would save them hundreds of dollars in tune up charges and would more than make up for the initial extra shipping charges. Sales soared.

In the world of Marketing you will hear the term Unique Selling Proposition or USP. I prefer the term Capo d’ Astro Bar. In a strange way, it is easier to remember Capo d’ Astro Bar than Unique Selling Proposition.

So let me ask you again, “What’s your Capo d’ Astro Bar?” Look for whatever is unique and different about your product or service. If you don’t have one, think one up. Then use it to increase your sales.

Thursday, September 9, 2010

Some More About Guerrilla Marketing

I thought it might be useful to some readers to read about some specific examples of guerrilla marketing that have worked for my company. My company makes branding equipment and we receive frequent calls from customers asking for brochures or other information. Every time we mail out a catalog or brochure, we include a 10% discount coupon that is valid if the customer responds with an order within about two weeks. (The two week provision is another marketing ploy. We want them to place the order now, before they put the brochure aside and forget about it.)

Now comes the guerrilla marketing. We bought some off-the-shelf picture post cards of Santa Barbara. On the back, in my wife’s handwriting I had the cards printed in bright blue ink saying some cute remarks about Santa Barbara and adding, “Hope you can use that 10% coupon we sent you.” Then, about one week after we mailed the brochure to the customer we followed it up with the “handwritten” and hand addressed (by my wife in the exact same color ink) picture post card. The idea behind this was that no one can resist seeing who is sending them a picture post card from Santa Barbara - a city known around the world. And being “handwritten” and short, we felt reasonably certain that most of the cards got read. They must have been because that simple post card marketing idea increased our sales by about 50%.

Many of our sales come from quotes that we send to customers for their specific requirement. We used to convert about 1/3 of those quotes into sales. Then we tried what we called “our fishy letters.” We bought a bunch of squiggly plastic fish usually used as fishing lures. We put one of these fish into an envelope along with a sheet that had a big picture of a fish on it and read something like, “Something’s Fishy. We sent you a quote the other day and we never heard from you. We know it’s not because we don’t have the best prices and we know our quality is the best, yatta, yatta, yatta.” Here’s how that worked. No one could resist opening the envelope after they felt something squishy inside it. Once they opened the envelope, they read our cute letter and apparently got the message because that little marketing trick increased our sales from getting 1/3 of our quotes to getting 50% of them.

Here’s another guerrilla marketing idea I recently heard about. A real estate agent in the San Francisco area drives over the Golden Gate bridge every day on his way to and from his office. Every time he drives over the bridge he tries to position his car directly in front of a BMW or a Lexus or an Accura. When he gets to the toll booth, he pays for his toll and then he hands the attendant his business card and a second toll and tells the attendant to give his card to the driver of the BMW behind him. Of course the idea is that some day the driver of that expensive car may be in the market to buy some real estate and that they will have his business card. I have no idea how effective it is, but it sure sounds like a heck of an idea to me.

This what guerrilla marketing is all about. Do something different and clever. It does not have to be expensive; just different enough to attract attention or get a chuckle. Now think of something clever for your particular business and start increasing your sales.

Friday, September 3, 2010

Guerrilla Marketing and the Small Company

About twelve years ago a friend recommended that I look into using some guerrilla marketing ideas for my growing business. At the time, I had never heard the term and had no idea what it involved. Now I am a confirmed advocate of the results of guerrilla marketing. In the first few year after we started using guerilla marketing my company increased sales by an average of 250% per year and we attribute almost all of that success to our aggressive and creative guerrilla marketing. As far as I’m concerned, it’s the only way to go for a small business.

So what is guerrilla marketing and why are we so happy with its results? To answer that let’s first answer the question, “What is marketing?” The textbook definition of marketing is “all of the activities of a business required to produce, sell and deliver a quality product (or service) to the end user.” An even better definition is by Phillip Kotler in his book, Marketing Management where he says, “The aim of marketing is to make selling superfluous. The aim of marketing is to know the customer so well that the product fits him (exactly) and sells itself. Ideally, marketing should result in a customer who is ready to buy. All that should be needed then is to make the product or service available.” Or, using a military analogy, Marketing is a strategic activity as opposed to Sales which is a tactical activity. Marketing concerns itself with the future while Sales is concerned with the “here and the now.” Marketing is concerned with advertising, production, cash flow, distribution, warehousing, product selection, targeting, positioning, market share and of course, sales.

Guerrilla marketing is concerned with all of the same things. The main difference between guerrilla marketing and conventional marketing is basically in the amount of money and creativity used in each activity. To put it simply (and perhaps a bit unfairly) conventional marketing solves a $1000 problem with a $2500 solution; guerrilla marketing solves a $5000 problem with a $500 solution. Guerrilla marketing replaces a lot of money with a little money, more creativity, a bit more time (yes I know time is money) and a lot more sweat. Any small business with limited assets – especially money – will find that guerrilla marketing is what they need to increase their sales.

Before we get into the specifics of guerrilla marketing, let’s take a look at today’s marketing/sales environment. I can’t believe that I am the only person who has spent 15-20 minutes on hold while repeatedly being told, “Your business is very important to us. Thank you for continuing to hold. A representative will be with you momentarily.”

We are now in a business environment where it is just short of a miracle when you get to talk to a real person or do not have to go through a menu of six or eight selections (none of which are what you need) before you get to talk to someone – and then that is the wrong person, the wrong department or a person who can’t answer your question. Here’s another situation. You want to have one of the basic services - telephone, gas, water, electricity - hooked up. You are told by the office, “We’ll have a man out there between 8AM and 5PM next Thursday.” Excuse me? Do you think I have nothing better to do than wait around a whole day for your man to get to my house? Increasingly we live in a more remote, less caring, less human-to-human business environment. The anonymity and “remoteness” of the Internet is not helping. At the same time, scams of all kinds are increasing so is it any wonder why our customers are increasingly suspicious and less trusting? Does that give you any guerrilla marketing ideas? Like, “Maybe if I were more responsive to my customers’ needs, my sales or my market share would increase?”

Thursday, August 26, 2010

Product Development and the Trouble with Engineers (a tongue in cheek observation)

The trouble with most engineers is that they don’t know when to stop. It’s been my experience that if you ask a typical engineer to design a product, let’s say a cell phone, he doesn’t just stop when he has the basic design finished. If you give him free rein to “do his thing” you will wind up with a phone that takes pictures, plays 15 games, is a calculator, a scheduler, a voice recorder, an alarm clock and checks your tire pressure, traces your family history, trims your toenails and opens beer cans - and includes an instruction manual that has 139 pages where the instructions on how to make a phone call is on page 117.

My philosophy of product design is to start with a basic design that I can produce and sell for an affordable price and which does the job - and only the job - for which it is intended. Later, depending on customer feed-back - and I can’t over-emphasize how important it is to listen to your customers - I will introduce an improved or “heavy duty” model. Of course these later variations will cost more and I will probably sell less of them but they will satisfy a more specialized need than our basic model. And while I’m at it, I will make sure that the heavy duty model uses as many components of the basic model as is practical.

Another reason for developing the “new and improved” model is that it frequently allows me to make a sale which I would have otherwise lost. And continuing to expand my product line gains me the reputation as the company that “has all the answers” and “has any product” that you want. This sort of reputation inevitably brings more business. There is still one other reason for expanding our line and it has to do with web site dynamics. The more products that you show on your site, especially if the names are similar or related, the higher (better) positioning you will achieve with the search engines that find you when people do a web search.

To illustrate, let’s assume I want to develop a coat hanger. I would probably start out with a very basic formed wire model that you get from every dry cleaner. I will make whatever tooling is necessary. Later, one of my biggest customers will come to me asking for a model that has a paper sleeve over it that can be imprinted with his advertising message. No problem. I will add whatever tooling is necessary to fabricate and apply the paper sleeve. I will probably even offer to do the printing on the sleeve.

A few months later another customer will request a plastic hanger instead of the common wire basic model. Again, no problem. We will add another production line, some new tooling, perhaps use a few components from the basic model and suddenly we have a new product to add to our line of coat hangers.

And then we may start to have some problems. Some of our customers begin to complain that the plastic hangers break too easily. So we get busy and re-engineer our design to come up with a “heavy duty, deluxe” model which costs more but holds more clothes and lasts five time as long. And we continue to produce the original plastic design because many of our customers understand and expect a certain limited life from our much less expensive original model.

This philosophy will work whether you are producing a product or offering a service. And it is especially important if you are starting a new business. Design and build a basic product (or service) and start selling it. The priority is to get your business off the ground; later you will introduce more and better products and services.

There is one situation where you may want to ignore my advice regarding offering just the basic product or service. When you are starting a business you will want to be in some way better, improved or faster than your competition. So when you are starting out, if you can offer the slightly better product or service that will give you an “edge” over the existing competition that is the time to do it. Be creative, there is always a way to improve on an existing product or service.

By the way, does anyone know where I can buy a cell phone that just makes phone calls?

Saturday, October 11, 2008

My First Luxury Cruise

My wife and I just got back from a cruise to Alaska. It was my first cruise and I had been looking forward to it for months. I was eager to see all the sights, the on-shore excursions, the marvelous food, the great entertainment and all the fancy amenities shown in the travel brochures.

The magnificent scenery of Alaska – especially being "up close and personal" with the Hubbard Glacier was a never-to-be-forgotten experience. We also enjoyed visiting the unique towns of Juneau, Sitka and Ketchican and the too-short visit to Victoria, British Columbia. I enjoyed the fishing trip out of Ketchican even though our party of four caught only one 15-pound silver salmon.

I must be getting old and crotchety because there were lots of things about the cruise that disappointed me.

First of all, the food. On our ship there were three places you could eat; the Lido Deck which was a cafeteria-style restaurant open 24 hours a day, the formal Vista dining room for dinners and the Pinnacle Grill for lunches and dinners for those willing to spend the $20 cover charge for dining there. The food and service in the Pinnacle Grill was simply great. In the Vista dining room, the service was fine but the food was somewhat skimpy and the quality was spotty. As for the 24-hour food on the Lido Deck, let me put it this way – I’ve had better at Denny’s. A little disappointing considering the cost of the cruise.

I was annoyed to find out at the end of the cruise that it cost us $2.88 per day ($23.04 for the eight-day cruise) for the bottled water that room service supplied unasked. For me that was a good example of being "nickel and dimed" to death. When you’re spending thousands of dollars for a trip like this, shouldn’t you expect them to furnish the water at no charge? Conversely, the cruise line should simply add the few bucks to their trip package up front price if they are working that close to the profit line.

But my biggest annoyance was being sold something everywhere we turned during the trip. There was an "art gallery" that aggressively promoted the sale of their various paintings under the ill-concealed guise of holding "How To Bid At An Art Auction" classes. There was a photographic studio that equally aggressively promoted color pictures taken of guests here and there during the trip by their cruise paparazzi. Then there was the highly-touted lecture on How To Save Money When Shopping Ashore which turned out to be an hour-long infomercial steering us toward several selected jewelry and knick-knack shops who (we discovered later) have paid the cruise line to be "sponsored" by them. ( I get enough of this kind of thing at home by phone almost every day. I really don’t need to be subjected to it on a cruise that is costing me big bucks.) Then, at almost every dinner we were subjected to walk-around vendors trying to sell us souvenir cruise line shot glasses of Bailey’s or creme de menthe or some other tschotke or another. Perhaps the most irritating incident concerned another so-called educational experience involving our captain. Here is a man who is in complete charge of a multi-million dollar, zillion-horsepower ship with about 1900 passengers and a crew of around 800 who is enlisted to teach us how to cook salmon – after all that’s the big thing when you’re in Alaska. I am sure the captain is well trained and well qualified as a sea captain. A showman he is not. A chef he is not. And then it turns out that this cooking lecture/demonstration is nothing more than an hour-long commercial trying to sell us an over-priced freeze-packed, direct-to-your-door package of salmon steaks and crab cakes. Irritating as hell and I haven’t even told you about the "end-of-season specials" in the ship’s gift shops, the charge of $12.00 for a half glass of cheap champagne while we were all on deck admiring the Hubbard Glacier or the half-price-package special by the ship’s spa and massage studio.

But I got some great shots of the glacier.

copyright 2008 by Paul Burri