By: Paul Miller

Even black cats need a reason why

I didn’t do a Friday the 13th promo yesterday. Did you?

In my case, I didn’t get a promo out despite a monthly reminder on my calendar. Yes, every month a week or so before the 13th, a recurring reminder prompts me to check if there’s a Friday the 13th that month. This month, there actually WAS a Friday the 13th, which is a great time for a promo tied to the “holiday”.

I do this and recommend it for my clients for Friday the 13th and other oddball “holidays” because they’re a reason why, even if it is a quirky one. You can always craft a unique story between a product or service and almost any normal or oddball/unusual holiday. For that matter, you can make up a holiday that’s all yours. It isn’t like you’d be the first to do that.

A reason why

Before we do that, let’s go back to the business reason for doing this in the first place: A reason why.

There are all kind of reasons to do a promotion, but they are more productive if there’s a reason behind them – even if the reason is downright silly.

A few years ago, a Baltimore business had an 11% off sale after a snowstorm dumped 11 inches of snow in the area. The online business hadn’t slowed since snow didn’t disrupt their nationwide retail traffic, but the 11 inch snow was worth celebrating so they had a little sale to commemorate it.

Please understand that when I¬†say “promotion”, I am usually NOT talking about “a sale”.

In particular, I’m absolutely not talking about the 40-50-60% sales that stores seem convinced are a daily requirement to keep a mall store open, or at least to generate the traffic they think they need.

I don’t spend much time in malls, but a recent visit had more stores with BOGO and 40-50-60-70 (yes, 70!) percent off sales than I’ve ever seen.

Either their original prices are fantasy or they are in serious trouble.

What exactly is a promotion?

Since I’ve made it clear what a promotion isn’t, I should also make it clear what a promotion IS.

A promotion draws attention, giving your clients and prospects a reason why. While it might include some sort of discount, it doesn’t have to. A well-executed promotion certainly doesn’t need discounts to make it successful.

Promotions commonly attract a specific type of client and prospect to your business. The newbie, the expert, the confused, the investigator, as well as those categories of prospects and clients within each product/service niche you offer.

Fine tune your reason why

A local home brewing store can have a promotion to introduce brewing to their clientele, yet still narrow the audience and get a specific kind of buyer. Instead of having a Saturday in-store brewing day promotion / event, they might have one focused specifically on India Pale Ales (IPA) and then rotate through other styles. In a large market area, they may want to narrow IPA days down to double-hopped or dry-hopped IPAs.

When doing this and focusing on one brewing style, they might stock up on fresh IPA-ready hops and have several brews in different stages of brewing so they can teach each stage’s hopping techniques.

Doing this with a dozen different styles of brewing on the same Saturday would be out of reach for most home brew stores – and would likely hurt business by confusing those who are paying attention.

Worse yet, if prospective home brewers (ie: newbies) show up at the promotion and happen to be folks who don’t like IPAs or the hop’s influence on that style’s taste, they might never come back.

Attract, Educate, Train, Sell

Whether you sell home brewing gear and supplies, or power tools for artisan woodworkers (hmm, do those mix well?), you’re likely to want to separate promotions by audience type so that you don’t attract newbies who need broad knowledge to make a decision with experts focused on tightly defined niches.

The point of the promotions described above is to attract, educate, train and of course, sell. No matter what you do, you’re likely to have prospects and clients interested in what you do that fall into groups you could arrange into newbies, confused, investigators and experts.

What are you doing to give them a reason why?

By: Thomas Rousing

I despise the term human capital

I despise the term human capital and its partner in crime, people assets.

That aside, if you don’t take care of your staff, they are far less likely to be able to take care of your clientele and thus, your business, in a way that you would prefer and expect.

Like anything that you’d like to retain and improve upon, your staff requires your attention and this comes in several forms.

To that end, this NY Times piece from Tony Schwartz and Christine Porath nails it.

 

By: Walter

Pricing custom work well is a strategic advantage

How good is your business at pricing custom work?

If you don’t have a way of pricing custom work that consistently accounts for your costs and labor, how do you know if you’re making any profit on these deals? How would it feel to find that you’re losing money on half your custom work?

Do you have a spreadsheet or software program to help? If not, do you have some other formulaic means of pricing work?

If you read the May 12 New York Times “You’re The Boss” piece by the owner of Paul Downs Cabinetmakers, you’ll learn that these guys are fortunate enough to have a formulaic method to determine the price of a custom item.

That they have this formula puts them ahead of most businesses that do custom work. However, the trouble starts when they discuss what’s going on behind the scenes as there are a number of things going on that conspire to cause problems when reality and the pricing formula meet on the shop floor.

The failure points

Downs¬†mentions that the spreadsheet’s material prices haven’t been updated in over 6 years, that material use and overages are not tracked, that tool use and labor methods have changed and that the info in the spreadsheet is sometimes entered wrong and fails to match the reality of the work actually being done.

As you read about all the possible failure points of this spreadsheet and how they’ve allowed it to become outdated and stale compared to their business reality, you can’t help but wonder how they got to that point.

Here’s the thing… this type of situation is pretty common.

Our tendency to think we’re too busy to address these critical, but tiny (at the time) maintenance issues has a way of giving us permission to postpone giving them attention. We think we’ll take care of them someday since some other thing seems more important right now.

It doesn’t seem to work that way, despite the best of intentions.

What usually happens is that the business lets these little things get out of sync an hour at a time, a day at a time, a week at a time and so on until we find that our internal systems look like they were designed to run some other business (or none at all).

At some point, things will have crept so far out of line that you’ll have no choice (like Downs) but to address them. Not only has the job you face become massive, your strategic advantage of having accurate, formula-driven custom pricing will have become the exact opposite.

Why does it matter?

The trouble with getting your business into this situation is that it severely damages your ability to see trends, know if you have enough (or too much) raw material or labor to deliver upon your work commitments.

If you’re already stuck, you have to consider the cost of continuing with a broken pricing model, assuming you have one.

If you aren’t sure you’re turning a profit on custom work – the showpiece work of your business – this merits immediate attention.

This is your best work. It’s the work that generates the reputation that earns your bread and butter work. It’s the work that you use to get your best, most profitable clients.

And yet you aren’t sure exactly how much profit you make on it?

If a close friend was in that situation, you know how you’d react. You’d go out of your way to make the situation clear to them, helping them if possible.

Why not do the same for yourself?

Should this take six months?

No, it shouldn’t. While Downs says his expert worked on this for six months, I suspect what he really means is that it took six months from start to finish – not that his expert worked on it eight hours a day, five days a week for six months.

The important thing to remember is that this doesn’t have to be perfect the first time.

Start with the highest impact item you can wrap your head around. and implement it. Tweak and add pricing components one at a time to improve accuracy.

This allows you to see results and adjust for accuracy and additional information without allowing any single change to be so complex that you have no way to assess its worth, much less its accuracy.

Get to work!