From time to time when talking to potential clients about the suitability of them doing a newsletter, Ben and I are often left wondering what the costs of not doing a newsletter are for the client.
The worst case scenario is you do nothing. Nothing changes – if you are looking at doing a newsletter then you are obviously interested in growing your business by one means or another. Nothing changing means your current trajectory continues. Which, as we just discussed, is the worst possible scenario because you are unhappy with the current situation and you’ve changed absolutely nothing.
Now if you want to grow and you are exploring options then all well and good if you can manage to find another way to spend the same amount of money to make a better return. We’ve had a client track a 504% return from doing a newsletter with us. There aren’t too many places where you can get 5 times the return on investment over 12 months in a business or in investing for that matter.
If you do have an alternative avenue to place that investment that outperforms a newsletter – terrific use it. Manage your business by the numbers. We are not going to discourage you from being that ruthless.
The Back End of your Business Is Where the Magic Happens.
Prosperity, Equity and stability in business have less to do with customer acquisition and more to do with customer retention and how you monetise your customers once you have them.
It’s not how many customers you have but how good they are.
Groupon’s Death Spiral
How many of you would like Groupon’s customer list. Personally you’d have to pay me to use it. Groupon’s customer list is the list of all the price shoppers. The idea sounded better in principle than in reality.
The Groupon pitch to business is – ‘put an irresistible offer to our database and you get new customers.’
Good deal?
Not when the customers you get sent are highly unlikely to come back to your business and pay full price. Odds are the only time you’ll see them again is when you run another Groupon special.
The businesses using Groupon have wised up. The offer quality being made to Groupon are going down, the response rates are going down which means the businesses that next use Groupon are going to make a worse offer because they know the response rates are low, further lowering response rate.
Soon Groupon will be dead – punished for being the piece of idiocy that it is.
You challenge is to get good quality customers who keep buying from you again and again and again. There is stability and equity in that. A newsletter does exactly that.
It helps you keep those customers coming again and again and again. It lets you promote your other products and services to them. You can get those good quality customers to refer other customers of similar quality to you. It means that you can promote allied product and service providers to them through your newsletter.
It means that because your customers are spending more with you that you can go out and spend more to get more customers.