Sales and marketing
This section contains tips and advice on a range of sales and marketing issues.
Are your customers really as happy as you think they are? Conducting a customer satisfaction survey will reveal much about the expectations of your customers, and the extent to which you are meeting those expectations.
A good survey will allow you to identify areas of weakness and plan future ventures, and will help you to exceed expectations in the future. But if it is to be a truly useful tool, your survey must be properly executed. There is a method to compiling an effective survey - here are some key pointers:
Remember: a reasonably satisfied customer is not necessarily a loyal customer. Knowing the difference between satisfaction and total satisfaction will help you to encourage customer loyalty and allow your business to compete effectively. Anticipating problems, rather than reacting to them, is the key.
Customer Survey Tips
Traps to Avoid
What should you cover?
Here are some examples of the kinds of subjects you may want to feature in your survey.
- Image of company
- Place in the market
- Range of goods and services available
- Value for money
- Performance of product
- Ease of use (from order to delivery)
- Comparison with others on the market
- Staff attitude (friendly/knowledgeable)
- Handling of queries (quickly/effectively)
Depending on your objectives, you may want to go into more detail with some subjects than with others. A survey that is focused on evaluating customer service may want to ask specific questions about a customer's experience, such as how many times they have contacted the company.
Question types
Here are two common types of question. Don't simply stick to one format: instead, use the question most likely to give you the information you want.
Networking is one of the most effective ways to win new customers or clients, discover new talent, meet new referral sources, and generally stay in touch with developments in your industry and marketplace.
It takes time and commitment to build up and maintain an effective network, but in our experience these are resources well spent. As with so many aspects of business life, it pays to approach networking in an organised, strategic manner. Take the test below to see how you rate as a networker:
Do you prepare for networking occasions by setting specific goals rather than just waiting to see what happens?
Do you attend such occasions equipped with something to give to everyone you meet (a contact, some information, some useful advice, etc)?
When you meet a new contact do you go out of your way to make them feel at ease?
Do you actively listen to people, rather than using their turn in the conversation to think of what you're going to say next?
Each time you meet a new contact do you deliberately say or do something memorable that will help them remember you when you follow up?
Do you categorise the people you meet into potential customer or client, potential referral source, or potential associate?
When you are handed a business card do you take the trouble read it straightaway and acknowledge receipt with a positive remark, rather than just slipping it into your pocket?
Do you keep a database of contacts that records when you met, areas of potential interest, and so on?
Do you have a strategy for cultivating contacts over a long period?
Do you have a personal ban on explicitly trying to make sales at networking occasions?
Immediately after a networking occasion do you follow up all contacts both old and new with a written or verbal communication?
How did you score?
Give yourself a point for every item that you agreed with in our checklist. Then tally the results:
10-11
Outstanding! Personal contacts contribute significantly to your business success.
7-9
You are pretty good at working a room, but could still brush up on a few skills.
4-6
You are probably missing out on potential profit opportunities - remember, no matter how good a conversationalist you are, without a strategy and some planning, your networking will be less than 100% efficient.
0-3
Time for a rethink! Remember that networking opportunities offer more than a chance to attack the hors d'oeuvres. Think about what you really want to achieve from a social event, and devise a plan to meet those goals.
No matter what line of business you are in, marketing is essential. And whether you have a marketing department or the marketing department is you, putting these pointers into practice should greatly improve your performance.
- Make sure your products or services are distinguishable from your competitors'.
- Monitor your competitors' marketing activities, and change your own as appropriate.
- Have a marketing plan - and follow it!
- Aim to provide a regular stream of new customers.
- Respond quickly to customer complaints, investigate the causes and fix the problems.
- When you lose a customer, contact them and find out why.
- Uncover customers' needs. Find out what they really want from your business.
- Keep advertising expenditure within industry norms. Over-advertising smacks of desperation, under-advertise and no-one knows who you are.
- Search for new markets for your products or services.
- Keep your existing customers aware of all you can offer.
- Actively look at new products or services.
- Keep your sales forecasts and statistics up to date and distribute them to appropriate employees.
- Make sure that staff who come into contact with your customers or clients have high morale and present a positive image of your company and its products and services.
- Use your remuneration structure to motivate and reward sales people.
- Invest in sales-focussed training for your non-marketers (show them how they can have an impact on sales).
- Evaluate the performance of your sales team and provide training where needed
Most business owners know that they should do competitive analysis, but often they do not know exactly what to do, when to do it, and how to extract the most value at the least cost.
Competitive analysis is more effective when it is really focused - and in such a way that leads directly and quickly to real business improvement. You can do this by 'benchmarking' your business against competitors.
Why benchmark?
Without some benchmarking you can easily get overtaken by other competitors, or by new forms of competition. You can also become complacent, take customers for granted and become sluggish and reactive, rather than proactive.
Indeed, this can happen even at the highest level of business. For example, the board of Marks and Spencer has been accused of failing to respond to changes in the marketplace, when retailers such as Next and Gap, and even supermarkets such as Tesco and Asda, began to significantly erode Marks & Spencer's market share in the late 1990s.
Benchmarking should be an ongoing process, and not just an afterthought as part of annual business planning exercises. Every day could present opportunities to learn from your competitors and improve your business performance.
Who should you benchmark against?
You should analyse your business in relation to:
- competitors to whom you are vulnerable
- competitors with weaknesses, of which you may be able to take advantage
- strong competitors, from whom you can learn
- new entrants to the market, who might have a fresh approach to marketing or customer service.
How do you do it?
One of the most useful approaches is to use some form of "Competitor Profiling" technique. Using your chosen areas for benchmarking, you can create a table like the one below for each of your competitors:
| Very Strong 5 | Strong 4 | Average 3 | Weak 2 | Very Weak 1 | |
| Brand image | |||||
| Product quality | |||||
| Customer service | |||||
| Innovation | |||||
| Supporting systems | |||||
| Cost base | |||||
| Marketing |
Information can be gathered from a variety of sources, including: customers, suppliers, distributors, industry commentators and staff joining your organisation. You can also make contact with competitors - perhaps by acting anonymously as a customer - and you can examine their job advertisements, their annual reports, and their visible publicity, brochures and products.
Having compiled a table for each competitor, the next stage is to score your own business; you will need to try to see some of the criteria from the customers' point of view. This will allow you to see at a glance the comparative areas of strength and weakness.
What should you benchmark?
You should benchmark areas where we can take advantage of your strengths, or conversely, areas where you are most vulnerable. You can analyse aspects of your business by breaking it down into areas such as:
- product range, quality and pricing
- targeted markets
- image and branding
- distribution channels
- geographic area
- technology
- customer service
As you will be limited in the amount of resources and attention that can be put into new strategies to beat your competitors, you may need to be very selective. Perhaps you will initially focus on only 20 per cent of your business.
Interpreting the results
The important thing is to focus principally on learnings and competitive insights rather than primarily on measurement. Try bringing together key managers and staff members in short "focus" sessions - perhaps over a long working lunch. We can help you with this stage, and with other aspects, too.
Getting the maximum value for your business
Benchmarking should be an ongoing learning process. Its principal value should be as a spur to strategic and innovative thinking, and to act as a continual challenge to your business culture and mind-set.
But competitor analysis is especially important when you are contemplating any new business development. It can pay to act out full role-plays, and to "think as if I am a competitor".
As chess players know to their cost, if you spend all of your time thinking about only your own moves, you will almost certainly lose.
Nobody naturally enjoys listening to their customers complain, but if they are handled in the right way complaints can have a beneficial impact on both the performance and profitability of a business.
It is all a question of attitude - learning to regard complaints as a valuable source of market data and a unique opportunity to strengthen the relationship with the customer.
Complaints can increase customer loyalty
Often it is not the fact that something is actually wrong that annoys as customer, so much as the perception that they are not receiving a sympathetic hearing. A well-handled response can do more than just restore a customer relationship - it can improve it.
Indeed, research suggests that customers who complain and receive satisfaction tend to be more loyal than customers who do not complain at all. For a customer driven business, then, complaints are the highest form of feedback.
Serious damage
A business that lacks an effective complaint mechanism is not only ignoring an important source of information about the marketplace - it could also be allowing potentially destructive perceptions to spread within its customer base.
Very often the most damaging complaints are not brought to the company's attention but are voiced to other customers. Most dissatisfied customers voice their resentment to at least four other actual or potential customers. Without the window into your customers' feelings that an effective complaints mechanism affords, serious damage could be done to your reputation without your even knowing about it.
So rather than hoping your customers do not complain, you might be better off establishing a mechanism that positively encourages them to.
Five-step procedure
Here is five-step procedure to help you make the most of customer complaints:
- Listen sympathetically to a customer who has a complaint, and make sure there is always someone available to do this.
- Never be defensive, even if the complaint seems largely unfounded.
- Validate their complaint - show them that you understand their difficulty and empathise with them Spell out what you propose to do to remedy the situation.
- Do it!
Finally, make sure everyone who needs to know is informed of the complaint and the remedy - and that the lesson is taken to heart and integrated into your standard operating procedures for the future.
At AVASK we can advise business owners on many aspects of running and growing a business. Here are some thoughts getting more productivity from your sales team...
Do you know how much time your sales force actually spends selling?
- Statistics show that on average it is only 30% of their working time.
- 40% of their time is taken up with administrative tasks such as completing reports, sorting out account disputes, and dealing with delivery problems.
A lot of time can be saved here by standardising reports and having administrative support personnel type and circulate them. Solving customers' problems can be reassigned to other departments such as customer service or credit management.
The other 30% of a salesperson's time is typically taken up with travelling from one account to the next. Although this time expenditure is unavoidable, it can be made more productive by providing salespeople with essential portable office equipment.
Developments in information and communications technology, especially in corporate intranet technology, mean that it is now possible to work just as efficiently from a remote location as it is in the office.
Sales staff should also be encouraged to use otherwise unproductive time to complete administrative tasks such as record keeping, database updates, etc.
The more time your sales staff spend on actually selling, the higher your profits will be.
Owners of small and medium-sized businesses tend to have more faith in sales than they do in marketing, but this is often due to a misunderstanding of the marketing process.
Marketing has traditionally received a lot of bad press. It is regarded by many business owners as a vague, ill-defined process that involves spending a lot of money on persuading people to buy something they might not necessarily want - often with few tangible results.
Good marketing, however, is not about persuading someone to buy something you have - that is selling. Rather it is about understanding the needs of the marketplace and providing goods or services that fulfil those needs. In other words marketing is matching your product or service to people's genuine needs.
If your marketing is working well, you will need to do little more than inform prospects and customers of your products or services. If you are providing something they really need you will not have to persuade them that they need it.
This is not to say that persuasion does not play a part in marketing - it does. In a competitive market, for example, you need to convince prospects and customers of the relative benefits of your product or service as against those of your competitors. But if you have understood the needs of the marketplace well and differentiated your product or service accordingly, the benefits of what you are providing should largely speak for themselves.
We hear a lot of talk about 'Unique Sales Propositions' (USPs) but the time to be unique is when you are positioning your product or service in the marketplace, not when you are trying to sell it. Perhaps it might be better to call them 'UMPs' - Unique Marketing Positions.
The best way to steal a march on your competitors is to listen carefully to customers and prospects, understand their existing and emerging needs, and constantly modify your products or services to meet those needs.
The problem with emphasising sales over marketing is that you tend to put more effort into talking to customers than into listening to them. This might help to drive up sales in the short-term, but no business can build lasting success on trying to persuade customers to buy what it already has if it does not listen to its customers and provide what they actually want.
Most businesses aim to increase their sales and keep existing customers at all costs. But if you live by the maxim 'the customer is always right', you may find it bad for your bottom line. Sometimes the customer isn't right for you, and it makes good sense to regularly review your business relationships.
When customers think that purchasing from you is not in their best interest, they will look for a new supplier. Similarly, if one of your customers is bad for your business, you may need to make a change.
Check your customer relationships
Here are some typical signs that a customer relationship has gone awry:
- You need to spend a disproportionate amount of time dealing with the customer
- You receive a disproportionate number of complaints
- The price is never low enough
- Payments are always late Orders tend to be at peak times, when service is unavailable elsewhere
- Volumes are inconsistent and/or small
- Gross profit is lower than for most customers
If any customers show several of these traits, you should consider it a signal that trouble may be brewing. They may be signs of customer dissatisfaction. Make sure you correct the problems before you lose the business.
However, if you have customers with all of the above symptoms, consider terminating the relationship rather than jumping through unreasonable hoops to please them.
The benefits of losing a customer
Terminating a relationship with a bad customer can be difficult, but there will be major benefits:
- You will be able to spend more time with your best customers rather than dealing with the problems of the worst, thereby cementing your good relationships
- Stock levels can be reduced or more products made available for better customers
- Getting rid of late payers is good for cash flow
- Removing difficult customers will improve staff morale
Review your customers annually
Analysing your customers on an annual basis is a good way to determine which ones are most valuable to your company. Firing bad customers gives you more time to find good ones. You can then provide a superior service, knowing that all your customers are adding to your company's value. And that will be reflected in your bottom line.
Take a moment to consider the following question: who are your business's competitors?
If you take the question at face-value, you can probably give an instant answer: 'My competitors are companies x, y and z, who operate in the same marketplace and geographical area.'
But viewed another way, the answer could be, 'My competitors are anybody that my customers also deal with.'
Everyone is a competitor
People's expectations are changing: they are becoming more discerning and more demanding. Your customers might buy goods online from Amazon, bank by telephone and compare the services of gas and electricity providers as a matter of course.
This has implications for any business. If you offer an online ordering system, your customers will naturally compare the experience of using it to that of buying from Amazon, no matter what product or service you sell. If a customer calls BT to deal with an issue, and then calls your business to deal with another, they will inevitably compare the two experiences, even though you operate in an entirely different marketplace to BT.
Looked at in this light, your competitors are anybody with whom your customers can have a comparable experience.
Managing the experience
You may already have defined what it is that makes your product or service better than those of your obvious competitors. You may offer a lower price, or specialist knowledge, or you may have an unrivalled 'brand'. But if the customer does not have a positive experience of dealing with your firm, they may not be inclined to come back for more.
If you want to ensure customer loyalty, you should consider such questions as:
- What is it actually like to deal with your sales and customer service teams?
- How are customers greeted by switchboard operators or receptionists?
- How user-friendly are our systems?
- What happens when things go wrong?
The key is to imagine that you are a customer and ask yourself: what would it be like to do business with me? You might even want to pose as a customer and try to buy a product or service, in order to evaluate the experience first hand.
Remember that customers will not always tell you when they are unhappy with the experience of using your services. It's up to you to ensure that you continue to exceed their expectations.