Trim the Fat and Leave the Filet
The economy is delivering a one-two punch of higher costs and lower sales. It doesn’t have to be a knockout blow. In fact, it might not even hurt, if you are willing to cut costs, market smarter, and innovate. When there is a dip in the economy (some would say we are in a dive!), there is an immediate call to eliminate all non-essential expenses. If this is your company’s approach, please answer this question: Why do you have non-essential expenses in your business? After all, the purpose of business is to generate profits by serving customers. All expenses should be investments that move you towards better service or higher profits. Now is the time to start that movement. Even if you don’t have non-essential expenses, there’s always room for improvement. Your goal is to reduce costs without adversely affecting service and sales. This requires a team effort, top-notch analytics, and a scalpel to trim the fat.
To Start the Trimming Process:
Reduce Mailing Promotional Pieces to Hit-and-run Customers. You’ve heard it from me before. I apologize for the redundancy, but this is one of the fastest ways to reduce costs without affecting sales or service. If you identify 5,000 hit-and-run customers before you mail them four catalogs at $0.50, you add $10,000 to your bottom line. If you are marketing on the Internet, then you have a hit-and-run problem. Failing to recognize it and modifying your marketing to minimize the effect is costing your company thousands of dollars every year.
Stop Sending Mass Emails to Your Entire Customer File. They are spam, even if you require a double opt in and your customers aren’t complaining. This marketing technique is like a rattlesnake without rattles. You don’t know there is a problem until you are bitten. If you continually send discount or coupon emails, then you are training your recipients to wait for the sale instead of paying full price. If you are sending them too often, you are desensitizing your customers to your marketing. And, if your argument is that they are still working, you haven’t tested a generic discount email against one personalized by customer preferences and behavior. (Try it. I promise that the results will amaze you!)
Ban Accountants from Your Cost Analysis Team. Accountants make great number crunchers, but they are lousy marketers. They trim with a hatchet instead of a scalpel. Most start the cost cutting process with the largest line item on your financials. (i.e. Your marketing budget!) Long-term consequences follow their short-term gains. Multichannel marketing is a back-end business that requires upfront investments. Marketing money spent this month may be returned next month, next quarter, or next year. Eliminate the time required to explain how marketing is muscle, not fat, by keeping the accountants away from the cost analysis.
Eliminate Negativity within Your Company. There is good and bad in everything. If you focus on the bad, there isn’t room for the good to grow. This is especially true in corporate offices. If everyone focuses on the state of the economy or the challenges within the organization, there isn’t room for innovation. Creativity requires a positive environment to thrive. This isn’t an endorsement for burying your head in the sand. It is a recommendation to look for solutions instead of focusing on problems.
Reduce Reliance on Outdated Marketing Techniques. Direct marketing used to be as simple as defining the segmentation process, evaluating the results, and repeating for the next mailing. Today, we have more information available, better technology, and consumers who expect personalized contact from companies. (“Insert name here” doesn’t count as personalization.) Create customized marketing plans by combining behavior analytics with traditional segmentation. Your response rates and average orders will increase while your costs decrease.
Eliminate Incoming Customer WISMO’s (where is my order) Calls and Emails. Customers shouldn’t have to inquire about their orders. Not now, not EVER! Incorporate automated emails into your marketing plan. Stay in contact with your customers from the time you receive the order until they are satisfied with their purchase. Don’t stop the communication when the order ships. Send a follow up after the buyer has had time to use the item(s) purchased to insure complete satisfaction. And, if you don’t have email addresses for some of your customers, send a postcard or call them if there is going to be a delay. While the FTC requires a 30-day notice, corporate success requires immediate notification. This practice simultaneously improves satisfaction and reduces costs.
Reduce Multiple Shipments for Single Orders. Your customers only pay once for the delivery of their order. Follow their example, whenever possible. Manage your inventory to minimize the number of multiple shipments. Remember to keep the balance between backorders and overstocks. If you are out of balance, you are reducing service, profitability, or both.
Author: Debra Ellis
Article Source: EzineArticles.com
Provided by: Creditcard Currency Conversion Fee
- The successes and pitfalls of recieving donated tools and equipement from overseas
- Marketing and Communications Assistants
- The Asian Wildlife Trade
Related Posts -
VOIP Phones As technology is advancing, we have seen bigger reductions in phone rates and in our bills. I still remember the days when Telstra (Australia) used to charge me 2.20/minute on each call I am making to India. There is heavy competition in nowadays and now some providers are charging...... - VoIP or the Phone To Call Basically Voice over Internet Protocol (VoIP) means that you have the ability to hold conversations over the Internet or any other IP- based network. VoIP is as easy to use as a normal phone.When you make a call via VoIP it will normally cost less than other traditional phone......
- Hosted PBX - Avoid Capital Expenses Most of the small businesses and home-based businesses have switched to hosted PBX to avoid capital expenses. In a hosted PBX system, all the phone features of a typical PBX equipment are provided in a virtual manner. Through flexible communication features, the hosted PBX system gives the image of......
- Choose the Best Business Phone Systems For Your Business The installation of business phone systems in a business organization has become a must to improve the productivity, no matter how big or small the business organization is. Installing a business phone system helps to maintain a hassle free communication between the organization and all the important individuals, both within......
- Telecom Billing Errors Are Bleeding Your Bottom Line It's hard to imagine services more vital to your business operation than telephones and data circuits. Yet the Gartner Group research firm identifies telecom as among the most poorly managed functions in many organizations. "It is not hyperbole to state that networks and telecom are the worst managed functions......
Related Websites -
Successful Investing Tips and Techniques The true, most basic motivation behind investing is to grow our investment. People who have invested before will take their time, looking at the differing companies and the market, trying to predict how a stock will do in a year or two. Those investors whom are without the experience to...... - Viral Marketing-why Is It So Powerful Viral marketing is the new marketing and advertising trend right now, especially in the online scene. It takes advantage of the internet's network effect to be able to reach a great number of people in such a short time. Benefits of Viral Marketing Viral marketing strategies offer several advantages to......
-
Consumer Credit Counseling and the Law Let's be clear about two things:. First, there are millions of consumers who could likely benefit from counseling to help them control spending and reduce credit card debt. Second, finding a credit counselor who is competent, disinterested, and reasonably priced is about as easy as getting a straight answer from...... - H&R Block Opening Accounts for Refund Anticipation Loans KANSAS CITY, Mo. - H&R Block Inc. (NYSE: HRB) announced plans Thursday to open low-cost bank accounts for free for 1 million of its tax clients and significantly reduce the cost of refund anticipation loans for tax season 2007.At its annual meeting of shareholders, H&R Block Chairman and CEO Mark......
- Money Saving Tips: 75 Ways to Survive Recession Regardless of how economists refer to this economy, recession or no recession, people are hurting, financially. Unemployment, flat wages and rising costs for food and gas have many hurting. Check out these great money saving tips to help your family survive these tough times. Here are a few money saving......
Related posts:
