Archives for December 2012

I’d bet that at least 60% of Business owners have no idea how much it costs them to get a customer. Of the remaining 5% most probably don’t know how much they should be investing to keep a customer. This is important because you can work out how to best spend your marketing money to maximise return for a given marketing budget.

Let’s imagine you can buy a new customer for $487. And let’s say the lifetime profit well exceeds the costs of getting the customer. Great, you’ve got the first challenge out of the way – economically acquiring customers. Now what should you be willing to spend to keep them?

Before we answer that there are a few things to consider:

There are very few true ‘one and done’ businesses. Cars and houses are ones that spring to mind as obvious objections but I’ve owned 3 cars in the last 10 years and will probably buy a 4^th in the coming year. (Bought each one off of a different dealer. Hmmmm). Same is true of houses. I’ve lived in 4 houses in the last 10 years, listed each one with a different agent.

Those are all repeat purchases of the same product by one customer. Should those real estate agents and car dealers have been willing to invest in keeping me as a customer? Probably. Think about the commission on each of those lost sales – multiples of what any single salesman actually earned.

Not investing in retaining customers just means that you are going to be continually churning through your customers – never building stability in your business. There is long term business stability and (saleable) equity to be had from a satisfied client base that is willing to come back to you for their purchases.

If you aren’t investing in retaining customers, your business is as stable now as the day it was founded. You are going to be out hustling every day just to keep the lights on, without promise of your business getting any better.

The answer to my investment question is $486. If you will gladly spend $487 to get a new customer to purchase from you once, then spending $486 to get a repeat purchase from an existing customer makes sense. If it costs more, then you are better off to spend the $487 to go and get a new one. If it costs less you have just saved money to get the sale.

Making an investment in retention means that you need to be continually marketing to your customers, building a relationship with them and working hard to show them that you still care about them, even though they haven’t bought from you recently.

Nothing shows a willingness to invest in your customer relationships quite like a newsletter. It shows your customer you care enough about them to keep them in the loop about what is going on in your world every month. You can use your newsletter to make offers – increasing your customers’ life time value.

To find out how Newsletter Marketing Systems can play a part in your customer retention strategy call 1300 – 120- 106 for a no obligation, confidential consultation or else go to www.newslettermarketingsystems.com.au/get-started

Fire in the workplace can erupt without warning, spread quickly, and have deadly consequences for your organization. Follow these guidelines for staying safe:

•  Keep your workplace clean. Eliminate clutter—papers, boxes, and other combustibles—that can provide fuel for a fire. Don’t store anything inflammable near a heat source such as machinery or a heating vent.
•  Maintain your equipment. This can prevent problems arising from overheating or damaged electrical systems.
•  Watch your wiring. Frayed power cords and damaged outlets can pose a hazard. Also, be sure your electrical control panel is easily accessible so it can be shut down quickly.
•  Keep exits clear. Don’t let boxes, desks, or other obstacles block fire exits or sprinklers.
•  Train your people. Hold regular fire drills so employees know what to do in case of a fire.
•  Store chemicals safely. Look at the labels on paint, cleaning solutions, and other chemicals to determine their inflammability, and store them accordingly.
•  Check your fire extinguishers. Make sure they’re ready for use, and teach employees how to use them—but instruct them not to try fighting a fire that might endanger them.

There are a number of good reasons TV finance shows are not the smartest choice for investment advice. For one thing, the aim of these shows is to get the biggest audience they can in order to sell more advertising, with their financial experts there as much to be entertainers as they are to be smart investment advisors, and they have no accountability whatsoever for the results of their advice.

 TV finance shows also come with a great deal of conflicting information because of the sheer amount of advice and number of tips that such shows give out day after day. Finally, much of the information in these shows amounts to predictions of how industries or stocks will behave over the short term, such as next week, with investments that are made based on such predictions and hot topics often costing investors dearly.

TV finance shows are fine for entertainment, but for real advice an independent professional financial advisor is the best way to go.