Business

Sprint Stole Verizon’s Spokesperson. So What?

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Sprint Marketing

You almost have to give someone at Sprint a standing ovation for their recent advertising campaign featuring your Verizon’s “Can you hear me now” guy, Paul Marcarelli.

It’s the advertising equivalent of a judo hip toss.

Verizon is the big bully with more than 2X Sprint’s subscriber base. A lot of money was spent to make Marcarelli the face of the company (as well as the butt of their jokes). Now underdog Sprint is using Verizon’s own “brand equity” against itself.

One of the cleverest advertising coups in recent memory.

I’m convinced these campaigns won’t save Sprint’s sinking ship. I’m also convinced YOU can profit by studying what’s happening here.

Here’s What Sprint Did Right

The commercials are attention-grabbing. The first time you see THE Verizon guy playing for the other team, it’s nearly impossible to ignore.

  • Your brain has to try make sense of it
  • There’s controversy: what made Marcarelli go Benedict Arnold and switch to Sprint? (Turns out, it’s not call quality)
  • It’s funny in an “Oh no he didn’t” kind of way

It’s critical to hold your audience’s attention long enough to tell them what they need to know. That’s what gives you the opportunity to generate interest and desire.

There’s no rational reason for it, but “celebrities” almost always bring a level of trust to the products/services/brands they’re attached to. Over time, spokespeople can become (niche) celebrities and garner familiarity, likeability and trust.

At Halloween, Flo from Progressive is more popular than Dracula.

The ads are also focused on a value proposition: 50% cost savings. That seems to be the only thing Sprint has to offer…

Why It Won’t Make a Difference

— Sprint provides inferior service.  They’re even admitting that fact in these commercials.

Even if this advertising campaign effort brings in a lot of new subscribers (Q4 projections indicate otherwise), the business loses big time when people cancel their service due to poor quality service. This is a long-time problem Sprint hasn’t fixed.

— No one wants the 50% Off plan. Sprint’s CEO has stated the company will probably stop promoting this low-priced plan in the near future. Potential subscribers are looking for features they can’t get at that price.

The profit margins on this plan are so thin that they virtually guarantee a continuation of low-quality service in the future.

Quick Takeaways That Will Make a Difference for YOU

1) Provide great service. Or team up with/outsource to someone who can deliver great service where you’re weak.

2) Find out what your target market wants and offer it to them — in a way that highlights the benefits valuable to THEM.

3) Set your prices at a level that empowers you to a) offer great service and b) invest back into your business. You can discount yourself right out of business!

You don’t have to have a million dollar marketing budget to put those ideas into practice!

Is Working for Free the Best Way to Start Your Business?

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working for free stairs to nowhere

The idea of doing projects “on spec” (without pay) came up in one of the few Facebook groups I participate in.

To be more specific, a woman launching a new service business was offering to work for free in order to get testimonials and build her portfolio.

Is this a good way to start your business? Or is spec work a flight of stairs leading nowhere?

In business (almost) nothing is true across the board. What works for one entrepreneur may flop badly for another. In this Facebook conversation, I felt qualified to chime in and express my opinion, based on my extensive, often painful experience in a field closely related to the one being offered for free. Here is a slighly modified version of my comments:

I’m going to do something relatively harsh here…by recommending you seriously limit this offer (to work for free).

Having testimonials is great, but absolutely not necessary to launch your business. In a way, you’re postponing the launch of your business by clinging to the idea that you need “proof” of the value of your services.

Your time is extremely valuable. Especially since you have a family who likes having you around and “present.”

In all likelihood, doing content marketing for yourself will advance your business more than doing free work for other people, no matter how good their testimonials will be.

The thing is, there’s a huge need for the service you provide — but most of the people/businesses who need your skills do not fully appreciate that need. They don’t feel pain, so it’s hard to pry money from their hands, especially at a rate you deserve.

You would do well to seek people who already feel that need, that have a bleeding neck problem, to use the words of John Paul Mendocha.

See if you can get testimonials from colleagues and friends who already know you and are familiar with the quality of your work. Build up your portfolio working on your own website and marketing materials.

It’s also well worth your time to connect with people who might already be in touch with your target audience. Maybe you can work out a referral arrangement or a way to bundle your services together. Or subcontract work from other established people in the space you want to occupy (or an adjacent one).

Think graphic designers, etc.

And remember, don’t sell your services, as such. Instead, define the transformation you produce for your clients. How will their lives and businesses be different, better than before they hired you — or anyone else for that matter.

Define what you’ll do for them — and what you won’t. Specialize, if you can.

BTW, I’m not always right. This just advice based on my experience.

— — —

What about you? How do you feel about spec work?

My Recipe for Practical Invincibility

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Practical Invincibility

At the end of the day, my momma told me don’t let no one break me
At the end of the day, nobody ever could stop me
At the end of the day, you can’t regret it if you were trying
At the end of the day, I’m walking with the heart of a lion
~ Kid Cudi, “Heart of a Lion”*

* In most cases. Cudi’s lyrics do not promote values I adhere to. But I like this song a lot, and it’s pertinent to today’s conversation.  🙂

In my most recent newsletter, I asked the question “Is it healthy to believe you’re invincible?” I believe it’s a dangerous path – an overblown ego is bad for everyone and pride goes before destruction – but an essential one if you want to become a successful and influential entrepreneur.

The problem with the previous email is that we didn’t talk about how one becomes invincible. Let’s correct that. Today, I’m going to share my personal recipe.

Please note that because this is MY recipe, it is imperfect (probably). I don’t claim exclusive insight. I’m just sharing what I’ve learned in my own study and experience.

Walking with the Heart of a Lion

When you think about the most successful people you know…and the ones you read about… one of the prominent characteristics that most of them seem to have is confidence. But telling you to be more confident is not helpful at all. That’s not how it works.

You don’t become more confident by focusing on being more confident.

In my experience, I’ve found that clarity is the sturdiest foundation for confidence. But clarity it is even more important than confidence. Why? Because clarity

  • gives direction – how can you make progress if you don’t know where you want to go?
  • minimizes distraction
  • decreases resistance by strengthening your conviction of the “rightness” of what you’re doing
    • internal – conviction is the combustion that drives your engine. When you know what you’re doing, why you’re doing it, and what you’ll get out of it, those sneaky feelings of procrastination, doubt and lassitude are kept in check
    • external – your conviction gives you a hard-to-resist pathos when communicating with others. Powerful speakers, charismatic leaders and persuasive salespeople emanate certainty, and are able to move the masses.

Don’t Let No One Break You

If you want to be invincible in practical terms, you need to get clear about

  1. The source of your ability: your God-given gifts, the skills and knowledge you’ve developed and your hard-won experience. No one can take these away. If you put your confidence in your position, the approval of peers or something else that can be taken away, you’re walking on thin ice.
  2. Your end goal. Most of the people you know drift through life. A clear destination gives you a target to aim at. Instead of drifting, you’ll be driven. Instead of taking whatever comes easy, you’ll strive purposefully toward the bigger future you want to attain.
  3. The steps you’ll take to get to the destination, if possible. Or at least the next step. It’s easy to feel paralyzed when you don’t know how you’re going to reach your goal. So take some time, do some research and think it through. Don’t let fear or knock you off the path.

You Can’t Regret It If You’re Trying

Clarity is the first ingredient in my invincibility recipe. Tenacity is the second.

I define tenacity simply as the understanding that success is an ongoing process with the willingness to keep showing up and making the difficult choices required to move forward.

Without clarity, tenacity is shadowboxing.

Tenacity allows you to keep trying, even when things don’t seem to work out. It gives you the courage to test different ideas and approaches to see what works…and what works even better.

And it keeps you going when everyone else is quitting.

Try to avoid second-guessing yourself. It’s a fairly destructive habit. You’re going to make mistakes, there’s no avoiding that. But make a decision and go for it. You’ll be surprised how much good can come from an imperfect decision. And if it doesn’t work the way you’d hoped, be tenacious: regroup and figure out your next move.

The Secret Ingredient

Of the three parts in my recipe, this is the most controversial. Donald Trump and Michael Jordan would probably disagree, and they both have much more money than I do!

I believe outward focus is absolutely essential for invincibility. Self-centeredness limits the amount of value you create for others. It hurts your relationships – all of them – and often leads to depression in the long run.

Remember what Zig Ziglar said: “You can have everything in life you want, if you will just help enough other people get what they want. …If you put other people first, the dynamic of helping others will overtake you and put you over the top.”

Have an invincible day!

Becoming the Most Productive YOU Ever

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Productivity: Make it Happen

Contrary to the opinion of many, productivity is not a function of speed. It’s all about results.

Making 20 sales calls in an hour is working fast. But if you make a bad impression on 20 good prospects, the hour was unproductive.  (Cold calling is rarely productive, by the way. At least for most of us.)

Entrepreneurial people live in what Dan Sullivan calls the “results economy,” not the “time and effort economy. Working harder, faster, and taking fewer breaks may seem like a more productive way of living. That’s not necessarily the case. In the end, the value you produce is what matters.

All things are not equal. Knocking out 90% of the tasks on your checklist may be unproductive…if you’re doing it to avoid the handful of things that will have the biggest impact.

Now, I’ve never claimed to be the world’s leading authority on productivity. But as an obsessed freelance copywriter with 4 kids and a gorgeous wife who deserves my attention, I have to maintain a degree of focus. Not just activity, but money-in-the-bank results.

My more productive days have distinctive characteristics that my unproductive ones. When I’m “on,” here’s what’s usually happening:

  • I get into motion. Inertia kills many people and projects at the starting block. It drains our reservoirs of enthusiasm and energy. Getting going is tough! Sometimes it makes sense to make the first step ridiculously easy to take. Get the forward momentum started and accelerate from there. Don’t overthink!
    • Once momentum is working for you instead of against, you might be surprised how productive you can be. A little step forward, a mini-victory can go a long way.
    • As a writer, this is HUGE. Don’t stare at a blank page for too long. Start writing. Your thoughts will clear up before you know it. Then go back and edit.
  • I prioritize in advance. I decide what results I need to accomplish and plan activities accordingly.
  • I prepare in advance. The work starts before you start working. You wipe out a lot of dilly-dally if you come fully prepared.
  • I set deadlines. Without them, I’m practically dead in the water.
  • I use methods already proven to work instead of reinventing the wheel every time out.
  • I schedule my day, slotting my high-priority action items into times when my energy levels and focus are likely to be high – that’s usually evening for me – and my time will be uninterrupted.

The Other Part of Productivity

You have go beyond affecting your own mental and work habits. You’ve gotta produce an effect on other people.

How do you avoid doing all the right things only to fall flat when dealing with customers?

Go after the right prospects. Vegans don’t buy steaks.

Who wants what you sell? Who’s most likely to buy in the near future? Who has the ability to say “yes”? Who is already inclined to do business with you?

Strengthen the messaging. There’s a reason good copywriters and salespeople make a lot of money. Communicating persuasively multiplies productivity. I’ve seen conversion rates rise 400% and more simply by rearranging some words.

If you’re going to make sales calls or send emails, you might as well close some deals.

Use leverage. Make your intelligent efforts stretch even farther. Productivity levers include

  • authority
  • relationships with your existing customers
  • strategic alliances
  • expanding from one-to-one to one-to-many
  • repurposing existing materials.

A Word About State Management

I’ve found that I’m most productive when I’m excited about what I’m working on. Creativity emerges more effortlessly when I’m confident in my abilities and knowledge.

Negativity and disagreement put me into a funk.

You have to figure out ways to get yourself pumped up and confident that you’re going to knock it out of the ballpark.

—

*Update May 2017*

Here’s the recording of a livestreamed video I shot for my Facebook group. It’s about writing faster. Because… you know…I’m a writer (and there’s a good chance you are, too):

 

In Pursuit of Elephants

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Focus Business Growth

“The hunter in pursuit of an elephant does not stop to throw stones at birds.” ~ Ugandan proverb

The words rocked me when I read them for the first time. The weight of that truth. The multiple layers of application, personal and professional. The visual texture of the metaphor.

It’s amazing how much wisdom can be found on boxes of tea these days…

The ideas of purpose, focus and the proper use of time become increasingly important to me. There are so many demands on my time, energy and resources, it’s critical to figure out which are elephants and which are birds.

The cool (and simultaneously challenging) thing is, by and large, it’s up to you to decide which is which.

What are YOU pursuing?

One of the major components of the business growth model Michael Zipursky shared during last week’s training was defining who your ideal clients are. (FYI, you can see the replay of the 1-hour training here.)

Again, you get to pick who they are. You also get to decide, to a degree that would astonish many people, HOW you will work with them.

I don’t necessarily mean big-money clients when I say “elephants,” although there’s nothing wrong with that. I mean whatever is meaningful to you. Here’s the catch: most of us never define what’s important to us. We kind of just drift through life. Maybe we pat ourselves on the back when we avail ourselves of opportunities as they pass. But how many of those opportunities are “birds” that happen to land in our paths?

What’s important in your life? In your business? Pursue it like a hungry cheetah chases it’s next meal. Ignore as many insignificant things as possible. They’re wasting huge chunks of your time (aka your life)!

That means you have to figure out what your purpose is and focus on it.

A Stimulating Conversation with a From-Scratch Millionaire

Quick story.

On Monday, I had the chance to sit down and chat with one of my clients. His life is one of those true rags-to-riches tales. He showed me a YouTube video of his oldest son, who has also become a millionaire, giving a presentation at a major event.

I (strategically) asked what he attributed his son’s success to. He boiled it down to 3 main factors:

  1. Intelligence
  2. Insane work ethic
  3. Fearlessness

Both my client and his son have earned millions of dollars by choosing their elephants, expending massive amounts of energy pursuing them (working smart AND hard) and ignoring the insidious feeling of fear that would tell them to chase something smaller, less dangerous and easier to catch.

Sounds like good advice.

 

Are You Really “Connecting” with Your Audience?

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Connecting Content Copy

Forgive the alliteration. It might get a little crazy in here.

Connection. Conversation. Content.

Eleven months ago to the day, I did a Google Hangout with Roger Courville. Roger’s question to me was “How do you connect with people?” It’s a topic I feel like pretty well-equipped to answer.

Roger, on the other hand, is the KING of connectorship (which is a term he coined). He’s a genius in every sense of the word.

During this 50-minute conversation, we talked about my dark past in retail management, how that led me to explore the copywriting and how even in that stifling environment, people can connect with each other through content, and giving.

We also discussed the forces that make copywriting and content marketing connectors, from person to person, business to customer and business to business.

This hangout will benefit you because you’ll learn

  • what makes deep connections happen
  • how to be more customer-centric, even when time are hard
  • why giving is so important, and how to be more intentional about your giving
  • the various forms content can take, in real life as well as online
  • the best advice on the planet for copywriting that really connects
  • and plenty of other stuff.

It was a fun conversation with a good friend I don’t spend enough time with (and one of my all-time favorite clients). Have a look:

We recorded this conversation the day after my then 7 year-old son broke his arm. In all the hustle and bustle, I forgot to share this with you sooner.

I recommend you also check out Roger’s website and look him up on social media. He’s one of the smartest guys I know, and also one of the coolest and most generous. You’ll like him. More importantly, you’ll learn from him.

(FYI, Brother Roger wrote THE book on how to create webinars that rock — in 2009.  His thinking is always cutting edge, yet practical. As I said, he’s the king of connectorship.)

Big Ideas that Impacted Me in 2014

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Big ideas 2014

Boiling 12 months of brain activity down into a few hundred words is an intimidating task. But rather than giving a full-on commencement speech as you “graduate” from this year and move into the next, we might as well get straight to the point.

If I was forced to share the 3 ideas that had the biggest impact on my thinking in 2014, it would be these:

The Immense Importance of Identity in Decision Making

One morning in January 2011, I was standing in a cell phone store when there was breaking news story came on the radio. A mysterious 13th zodiac sign had been discovered — and with Ophiuchus (as the new sign was called) squeezing itself into the calendar, every other sign was shifted. Scorpios became Libras and the world was all out of wack.

Half the people in the store freaked. The man playing with the laptop display searched to find out the new dates, and a small crowd gathered around him, wondering who they were supposed to be now…

(Do you remember that day?)

I share that anecdote to illustrate a point. Astrology falls into the fairy tale category, but people’s reactions were very real. Some people think about their identity largely through the lens of their zodiac signs. They had seen themselves in their horoscopes for years. What happens with that is called into question?

The way we perceive ourselves affects almost everything we do. As a marketer, copywriter or salesperson, you MUST understand the way your ideal customers see themselves. It goes deeper than just features and benefits…even deeper than problems and desires.

This incident happened 4 years ago, but I am coming to understand the power of identity more fully as time goes by and experience mounts.

We’re going to spend a good deal of time fleshing out this idea and applying this concept in my upcoming training/coaching program. In the meantime, you can read about this incident in greater detail in The Ophiuchus Effect.

The Gargantuan Difference Between Prospects and Buyers


This was The Business Growth Question I Couldn’t Get out of My Mind earlier this year. It’s been stuck there for the past 350 days or so.

There is a world of difference between someone who reads your free material but hasn’t sent you any money. I advise you to check out the link to the article, because I’m going to be brief here.

Interestingly, when someone becomes a paying customer, their identity is altered a little bit. As they become accustomed to being a customer, they may come to think of themselves in terms of your product or service. There are Pepsi people. There are Apple people. There are Chicago Bears fans (we’re a depressed bunch these days).

Some of us are as loyal to our preferred products as to our political affiliations.

Do what you can to convert your prospects into buyers. The relationship you build with your buyers is arguably the most valuable asset you have.

The Enormity of Leadership


If this sounds familiar to you, it’s probably because leadership has been one of the Big Ideas that Impacted me in 2012 and 2013. The topic is both important and compelling.

I do not speak of leadership in the superior-subordinate sense. I’m talking about something closer to “I’m taking my flashlight in this direction; who’s headed this way?”

Even if you’re not giving orders, you are a leader if you have an audience. And as a leader, you have a responsibility for the well-being and progress of those walking with you. You have to

  • Teach them. Help them develop a worldview that will serve them well
  • Warn them. You see danger they can’t see yet. You’re aware of pitfalls they need to know about. Have the guts to stand up and protect them to the best of your ability
  • Encourage them.
  • Inspire them. Share your successes and the successes of other members of the group. Never miss out on a chance to give them good news.
  • Exemplify the philosophy you espouse. Walk the walk.

I’ve pontificated on this topic some more at Leadership: Burden and Blessing, if you’re interested.

Happy New Year. May this be your best year yet. Let me know how I can help you achieve that.

P.S. Have you registered to get your copy of Creating Business Growth yet? It’s going to be available for free on Amazon Kindle from January 1-5.

Weighing in at more than 300 pages, this book shares expert insights on
– Google Adwords
– Getting Referrals
– Neurolinguistic Programming
– Networking
– Search Engine Optimization
– Email Marketing
– Public Relations
– Unique Value Propositions
and plenty more.

This will very likely be the most useful book you read all year. What’s more, you’ll get to know nearly 2 dozen of the smartest marketers I know…men and women who have earned my admiration and trust over the past couple years.

Get more details and pre-register to get a free copy on New Year’s Day at http://creatingbusinessgrowth.com/.

This Is Probably the Main Thing Holding You Back

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Gary Halbert, one of the smartest marketers in history, said he believed most people would choke to death in a restaurant before they’d allow someone to perform the Heimlich maneuver on them.

I don’t think he was far off the mark.

Why would Gary make a statement like that?

I wasn’t there when he said it, but I think I understand his reasoning. He was trying to shed some light on the biggest force that stops most people from making the kind of progress they’re capable of making.

I’ll come back to this in a moment.

Your Real Job as an Entrepreneur, Salesperson, Marketer or Other Kind of Influencer

As a business owner, copywriter or marketer, you have a two-fold duty:
1. Create value for your clients/customers.
2. Get them to take action.

(Sometimes your ability to induce action is itself the value you create.)

I’ve often said it this way: A salesperson/marketer/copywriter’s job is to empower people do the things they already want to do.

They want a more comfortable temperature in house during summer, so you help them get the right air conditioner, etc.

A big part of that process is education. Education is in powerful tool for persuasion, but if it’s not helping the would-be customer take action to improve his life, it’s lacking. Consider this: a teacher gets paid to “do the work,” preparing lessons, presenting to the class, grading homework. As entrepreneurs and marketers, we don’t make money by simply doing the work. We have to impel customers to act.

What Holds People Back?

What keeps people from buying even when they’re in the market for a specific product, they can see the benefits and can afford to make the purchase?

The main reason is fear. The fear of making the wrong choice, looking stupid or getting burned. The fear of having to explain the purchase to a spouse or business partner.

Here’s a big one — the one Gary Halbert was referring to in the statement above: People are very protective of their comfort zones. Halbert said that people will “struggle harder to stay in their comfort zones than they will to save their own lives.”

When you ask someone to change their habits, their preferred brands or their way of looking at things — you’re asking a lot — even if it will get them closer to the future they want.

This applies to YOU as an entrepreneur or marketer.

We often cling to our way of doing things, even when we know there’s a more efficient way.

Or…

We spend hour after hour educating ourselves, only to keep doing the same things, the same way.

I’m guilty, too. Over the years, I’ve only implemented a fraction of the ideas I’ve spent hundreds of hours consuming.

Herein lies the rub: nothing is going to change if you don’t change it. You can either take responsibility for your own results or you can make excuses. One of those options empowers you; the other gives your power away.

If there’s something your business needs but doesn’t have…
If there’s something you need to do, but you’re not sure how to make the next step (or the first one)…
If there’s an urgent problem you have no idea how to solve…

…Own it! Then take action to get what you need.

Quoting Gary Halbert again, MOTION is the biggest difference between winners and losers. He said “You don’t have a choice of being afraid or not afraid in life; you’re going to be afraid. You’re either going to be afraid and frozen or scared and moving.”

Isn’t it time to get in motion?

 

P.S. Need help skillfully persuading your prospects and clients to take action? Come to my Irresistible Offers teleseminar August 11th.

When Business Gets Bloody

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“There is nothing to writing. All you do is sit down at a typewriter and bleed.” ~ Ernest Hemingway

Writing was Hemingway’s profession. All he had to do to reach legendary status as a writer was bleed.

I don’t know what success looks like for you. I assume (which is usually a dumb thing to do) that you want to build a solid, profitable business, provide for your loved ones, gain the respect of your peers and attain some level of freedom. Maybe you hope to reach legendary status in your profession.

Take heed to Hemingway’s advice. All you have to do is approach your business or career with a willingness to bleed.

Pouring Out You

As a small business owner or solo professional, you probably know exactly what Hemingway means in the quote above. Your business is an extension of yourself. Day after day, you pour yourself into it. You’re committed to its protection and growth.

In many ways, identifying yourself so closely with your business makes you vulnerable. At the same time, that vulnerability also makes your business appealing:

Your values shine forth. The things that are important to you are the driving force behind the decisions you make. You’re willing to take a courageous stand for what you believe in, even when it doesn’t conform to the industry standards. This can have a polarizing effect; some people will love you and some will hate you. People who share your values and beliefs are more likely to become loyal customers and enthusiastic supporters than they would be if you “played it safe.”

Your “brand” is authentic. What the public sees is what it gets. And what they see is the real you — in the form of a product- or service-providing business. More than ever, consumers are looking for transparent brands to buy from. More than ever, inauthentic brands are shown for what they really are: hucksters more concerned with turning a profit than serving their customers.

It’s hard to connect emotionally (remember: emotion is critical to every purchasing decision) with brands that don’t seem authentic.

Your message has personality. Generic marketing stinks. Personality and uniqueness of voice will make it easier for your business to stand out from the robotic sounds of the boring majority. Your distinct voice will be more attractive to the customers you want to do business with most; your personality demonstrates that you’re one of them! You “get” them! The bond you form can be deeper, i.e., more personal, than anything that can be achieved with pricing or even product specs. I always refer to Apple because they’re a great example of this principle.

Your hard work pays off. If success is 1% inspiration and 99% perspiration, how can you win without a willingness to bleed?

Not everyone who bleeds succeeds. But blood-letting usually precedes success.

Disclaimer: Pouring yourself into your business is no guarantee that you’ll succeed financially. It doesn’t even mean you’ll be fulfilled emotionally. All it guarantees is that you’re more likely to connect with the people you want to serve, partner with those closely aligned with where you are, and that if you do succeed, it will be on your terms, not someone else’s.

Good stuff from around the Web
Brand Your Business with Genesis Storytelling: Great 6-minute video from Tom Wanek on telling the “genesis story” behind your business

What Your Client Really Means by Price Objecting: “Your client just told you that they’re not interested in dealing with you, at least not on this subject. That’s not a price problem, that’s a relationship problem. And that’s a big deal.” Charlie Green tells us what’s really going on when a customer says “It costs too much.”

The Truth About Recycled Ads and Pickup Lines: What happens when you try to pour someone else’s blood into your marketing. Or dating. Great illustration from Chuck McKay.

The Wife-Approved Pricing Strategy

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pricing strategy

In an age when customers research practically everything before they buy, when there are mobile apps that point people to retailers with the lowest prices on items, and brand loyalty seems at an all time low, how does a small business stay competitive without sacrificing profits?

I began answering this question in my previous post, 3 Ways to Avoid Competing on Price. I mentioned three specific ideas:

1. Making bigger, bolder promises — and backing them up
2. Work on your secret sauce. Do something no one else does or add a unique touch of excellence to the mundane (simply make what everyone takes for granted into an extraordinary experience)

3. Develop a killer value relationship with your customers. (Unique propositions are good; unique relationships are better.)

Smack dab in the middle of this conversation about pricing, my wife spent a good chunk of the day shopping.

And just like you’d expect from a good wife, she illustrated my point, albeit inadvertently, by spending over $100 on makeup. Check out the picture above.

I’m pretty sure Ulta Beauty and Sephora have higher profit margins than the average drug dealer. But, that’s where my wife shops.

She could save more than 50% by buying her cosmetics at the local beauty supply or even Walmart.

But when it comes to makeup, price is nowhere near the top of her priority list. She happily pays premium prices for higher quality and unique color palates.

The difficulty with building loyalty is a good point…in some circumstances.

But is Nike struggling to maintain its customer base? Or Apple? Or Coke? Granted, these are established market leaders and most of us are not.

There’s still something to learn from the big boys.

Inexpensive offers almost always draw attention.

But if your marketing message and positioning speak directly to the customers’ need in a way no one else speaks or solves a problem no one else is addressing, price comparison fades.

Have you ever noticed that Excedrin Extra Strength and Excedrin Migraine have IDENTICAL active ingredients in identical dosages?

But one is marketed as the solution to a specific pain. People will pay more for the confidence that comes with that kind of focus.

It isn’t necessarily an issue of loyalty. It’s Sales and Marketing 101: What’s In It For Me?

If your product or service provides a more satisfying answer to that question, you don’t have to stoop to charging lower prices than everyone else.

If your marketing answers the WIIFM question by taking possession of prime real estate in your target audience’s mind, you don’t need to be the cheapest. You set the standard for your industry.

Harley-Davidson is THE definitive motorcycle; people who buy them generally don’t balk at the price.

Here are some fresh ideas to escape price competition:

Be a safe bet. Peace of mind is more valuable than most people realize. By eliminating the risks involved with purchasing your product, you free up some of your customer’s mental and emotional bandwidth. Knowing that they’re not going to get “burned” is worth paying higher price for. Testimonials, social proof, strong guarantees and proven support after the sale make reduce risk and make it easy to buy from you, even if you’re the more expensive option.

Focus on a tight niche, like Excedrin Migraine.  A specific solution to a specific problem is always perceived as more valuable than a generic solution to a generic problem. The more painful the problem, the more desperate the desire, the more it’s worth paying someone to scratch right where it itches.

Tell a fascinating story about the origins of the product or the company. Many times customers buy your product because of the “why” that drives your business.

Associate your product with a cause bigger than a simple purchase. Breast Cancer Awareness, Boxtops 4 Schools, and even Made in America are all appeals that attract certain types of people. Become an advocate for causes your target market supports and believes in.

Stop trying to sell to price-shoppers. Charge more and be unapologetic about it. Your product or service is for an elite class of clients.  For example, consider the curious case of the Aston Martin Cygnet from Forbes Magazine:

Take, for instance, the tiny European city runabout known as the Aston Martin Cygnet. In its most basic version it sells at more than $45,000. The car is actually made by Toyota and a Toyota version (identical except for some interior accoutrements) can be had for less than $17,000. On an apples-to-apples comparison, Which? (a London-based consumer magazine) reckons the average price discrepancy is more than $31,000. Thus those who prefer Aston Martin’s badge pay an outrageous three times more for exactly the same Toyota engineering!

Is that crazy? Not at all. The social and psychological benefits of owning an Aston Martin outweigh the difference in price for some buyers.

That’s reality. Someone is going to tap into it. Might as well be you.