Grow your Business by Treating Customers as Human Beings

April 25, 2012


What small business owners in his right mind would not treat his customers well if that leads to business growth. Yet there is no shortage of companies, large and small, that fail to take care of this basic fact resulting in disastrous results. Try calling customer center of your telephone company and see how long you have to wait before being able to talk to someone. Or go to a mall and study look at the expressions of customer service reps when talking to customers. How come very few of them bother to smile?
So, why is it important to treat customers properly?
[Read more…]

Filed Under: Customers, Sales, Uncategorized Tagged With: ,

Use Scarcity Tactics to Increase Sales

April 14, 2012


What is the best way to get rid of products that are not selling well? You can reduce the price to generate more demand. But there is a way better way to manage it. It is known as scarcity principle and it works by making customers believe that the item will not be available if they wait longer. The technique works because of human psychology that makes people want something more when they are told they cannot have it. Fear of losing out on something can be a powerful motivator.
You don’t have to use this principle to sell only slow moving items. You can incorporate it in the normal marketing practice to increase the sales of regular products. If you look around you will notice that many businesses are already using this principle in various forms. QVC always shows how many items are left when promoting their products on television. The last few items are always sold very quickly. When a sales person tells us that the item is out of stock, but he can probably find it at another store your reaction will always be to order it so as not to miss out from that store too.
There are several approaches you can take to implement this scarcity principle in practice as shown below:
[Read more…]

Filed Under: Customers, Marketing, Sales Tagged With: ,

Factors that Influence Pricing

April 10, 2012


Pricing is both an art as well as science as we discussed in earlier post on Ten Commandments of pricing. There is no one right way to determine the price of products or services you are selling. To a large extent, the price is based on the value customers perceive to get from the product and what they are willing to pay for it.
The law of pricing says that you should charge each customer the exact amount he/she is willing to pay for it for maximum profit. This is how auction system works. You let each customers announce how much he wants to pay and pick the highest bid. While it would be ideal to determine the price in this fashion, in practice it becomes a challenge to sell your products this way. That’s why it is necessary for business owners to come up with an advertised price and augment it with other ways such as coupons to attract more customers.
So what factors do you need to consider when pricing your products and services?
[Read more…]

Filed Under: Customers, Strategy Tagged With: , , , ,

How Saying NO to Customers can Benefit your Business

April 7, 2012


Here is an interesting news story we came across this week – Domino’s is launching an advertising campaign in which they claimed that they will NOT allow customers to customize their artisan pizza. Customers cannot add any more toppings to the pizza recipe. Domino’s claims that they have painstakingly perfected their artisan pizza recipe over several months and they refuse to let customers mess with it.
On the face of it, this sounds a bit weird and even risky. How can you say NO to customers who are paying with their own money? They can demand whatever they want with their money. But when you think about it some more their advertising makes sense. In fact, we would argue that saying NO to customers may work brilliantly in their favor. Allow us to explain why it is necessary to say NO to customers once in a while.
[Read more…]

Filed Under: Customers, Marketing Tagged With: , , ,

Ten Commandments of Pricing

April 4, 2012


Pricing a product or service is one of the most complicated yet important decisions that can determine the fate of your business. Most small business owners tend to price their products and services lower than the customers are willing to pay for out of the fear that increasing the price will make customers flee. However, it is possible to increase your price, and have customers love you for it. It is not only desirable, but imperative that small business owners understand how to properly price their products. After all, it is much more fun to compete on value rather than price Look at how Apple is able to charge premium for all its products
Based on our own experience and feedback from our readers we have compiled a set of rules that will help you in pricing your products. Here they are:
[Read more…]

Filed Under: Customers, Sales, Strategy Tagged With: , , , ,

How does Apple do it? Case Study on Premium Pricing

March 31, 2012


In the previous post we discussed how you can charge premium price without losing sales and still have customers love your products. No one does this as well as Apple, the most valuable company in the world by market value. Apple never competes on equal playing field with their competitors. They write their own rules and come up with innovative products that no one has dreamed off year after year. Their slogan explains how they have been able do this – Think Different! As a result Apple has been able to charge premium price for all its products and enjoy remarkable sales growth and margin for a long time.
What is their secret sauce? In this post we attempt to decipher their strategy by understanding how they apply the rules of premium pricing we described in the earlier post.
[Read more…]

Filed Under: Customers, Marketing, Strategy Tagged With: , , ,

How to Charge Premium Price (and Have Customers Love you for it)

March 28, 2012


Do you want to increase prices for your products without getting a hit on your sales? How about customers thanking you for charging them higher price? You probably think we have lost our minds, but trust us; it is possible do just that! We will show you how in this post.
It seems counter-intuitive to say that you will be able to improve customer satisfaction and increase sales while at the same charging more. Conventional wisdom says that if you are not doing well lower the price and customers will flock to your business. As natural as it seems, this is simply not true. Competing on price is not a sound business strategy for small business owners as explained in the previous post.
[Read more…]

Filed Under: Customers, Sales, Strategy Tagged With: , ,

Why is it More Fun to be Apple than Dell?

March 24, 2012


Here is a hint… It has to do with pricing power… And that can lead to lot of fun things.
Pricing products or services is a very complicated decision. And yet, it is probably the most important decision small business owners need make. Charge too little for your products and you will leave money on the table. Charge too much and you will lose customers and sales. You have to strike a perfect balance between the two ends of the spectrum to come up with the price that your customers will be willing to pay for and enable you to make money. No wonder pricing is considered both and art and science.
Many small business owners hold myth that they can attract more customers and increase their sales simply by reducing the price. Nothing could be further from truth. The move may work initially, but it will put you in trouble at the end. We will explain why in a minute.
[Read more…]

Filed Under: Customers, Strategy Tagged With: ,

Tools you can use to Uncover Customer Needs

March 21, 2012


Finding and serving the “right” customers is the most important step you can take to improve your sales. Many small business owners feel that the task is easier said than done. As a result, they fail to align their business with the right customer segment. Even when they do attempt to do it they either go about finding the customer needs in ad-hoc fashion or they use wrong tools to segment the customer base.
As we have noted earlier, we firmly believe that segmenting the customers based on their needs as opposed to demographics or location can improve your sales significantly. But how do you go about finding what customers really need and want?
[Read more…]

Filed Under: Customers, Marketing, Sales, Strategy Tagged With: , , ,

How to Improve Sales 5X by Focusing on Customer Needs

March 17, 2012


In the previous post we discussed how you can find the “right” customers for your business. By segmenting your customers based on their needs you can not only identify the customers that best fit the value your business provides, but also it provides you the action plan to target those customers. This is one, and most important, reason why we prefer to segment and target customer based on their needs. Once you have identified the “right” customer base you don’t need to spend extra effort to attract them to your business.
So, how do you go about finding the customer needs? While there are several approaches you can take to find out what customers are looking for, you can start with a set of attributes that are universally valued by various customer segments. These attributes give you a good starting point towards the path of finding right customer base.
[Read more…]

Filed Under: Customers, Strategy Tagged With: , , ,