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8/27/2012 | 3 MINUTE READ

Boosting Business in Tougher Times

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Here are some interesting tidbits about increasing your business in a sluggish economy.

As a publication we focus exclusively on new technology, its application, best practices, processing tips, troubleshooting, and various  other topics related to manufacturing. Rarely do we delve into issues like selling strategies or marketing. But these are critical aspects of your business as well, and as it happens, I had an exchange recently with Curtis M. Alexander, an online marketing strategist for industrial companies, and he passed on to me some interesting tidbits about increasing your business in a sluggish economy.

•Increase value and prices: Alexander says to be careful not to fall into the default mode of thinking every customer is price conscious when business isn’t booming. Instead, he insists, they are value conscious. He elaborates: “One industrial parts distributor I know was struggling mightily by trying to compete on price. At the end of his rope, he did something that went against the norm. He discovered that his customers would pay much more for the parts he was selling if he could deliver them quicker. This saved the clients from having their expensive machines sitting idle for days or weeks.

“In one year’s time he was able to triple the price he was charging for some parts. He was the only distributor offering guaranteed overnight delivery. This wasn’t the only change he made, but in just over one year’s time this distributor’s profits are up by 70%.”

•Stop prospecting, start positioning: When times are tough, Alexander says, no one goes to see the wise man at the bottom of the mountain. Your customers, he states, want to do business with the perceived number-one expert and the number-one perceived problem solver at the top of the mountain. The key the word, in in his view, is perceived. “You need to be good—you truly don’t have to be the best in the world at what you do,” he claims. “How do you start positioning? It’s simple when you focus on The 2 Ps: publishing and promoting. Write articles, problem-solving white papers, speeches, books, and the like. Then promote those works—not your actual business.” (My two cents: This is where agreeing to be featured in one of Plastics Technology’s On Site plant-tour articles fits in nicely.)

Alexander cites an example: “One industrial company had always tried to sell its product to engineers the old-fashioned way. Within 18 months of instituting their unique positioning strategy qualified prospects were now paying them $1500 per person to attend their seminars (the same thing they couldn’t give away for free before). Sales also went up, as did the company’s valuation.”

•Focus on relationship marketing: Alexander’s crystal ball tells him this will be the biggest marketing trend in 2013 and beyond. “Few businesses realize how much profit they are leaving on the table because they don’t maximize their current assets (current clients and customers),” he states.  “Too much of their energy is focused on getting new customers. A business that focuses on relationship marketing can often see an increase of 20% to 30% in net profit.”

As an example of this technique, Alexander sites Harvey Mackay, a best-selling author and for 45 years the CEO of the MackayMitchell Envelope Co., who was able to dominate his market through exceptional relationships with his prospects and customers.

Says Alexander, “Every time somebody showed interest or made an order through his company, they were asked more than 60 identifying questions. Few answered them all the first time around, but Harvey made it a point to get birthdays, anniversaries, hobbies, and the like. When their special day rolled around they got a handwritten card from Harvey, or flowers, or a phone call—something special to continue to build and move the relationship forward. Harvey dominated a stodgy and commoditized stationery market by focusing on building relationships. This resulted in a much higher rate of referrals from satisfied customers, which is always your most effective sales strategy.”

Other examples of relationship marketing include regular print and email newsletters. “Successful newsletters are done professionally (not written in corporate-speak … those are ignored) and are enjoyable to read,” Alexander states. “You should be employing follow-up messages with interested prospects via email autoresponders. This includes webinars and teleseminars where you re-purpose information you probably already have available.”