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Leveraging Your Marketing $ - part two
by Dan and Marilyn Milton
Part One of this series covered marketing attitude, why people do what they do, and the marketing concepts not taught in business schools. This second part will continue the discussion of an approach to leveraging your marketing dollars based on common sense and practical experience by looking at how to avoid making marketing mistakes.
THE MOST COMMON MARKETING MISTAKES WE MAKE, AND HOW TO AVOID THEM
Before all of us can improve our sales performance, we have to stop making marketing mistakes! Unknowingly, we are probably making one or more of these mistakes right now. The difficulty is that we get bogged down in the details of our business, strategies, people, and markets. Brilliance in marketing is simplicity personified!
What follows, will present a fresh new way of viewing your marketing, a logical perspective that may seem like it should have been obvious--but probably was not--until you have had a chance to think about it.
Cutting out just one or two of these marketing mistakes can catapult your sales or breeding service beyond everyone else's. Avoid all of them and the sky's the limit--literally.
Not Establishing Your "Unique Selling Proposition" (USP) and Stating It Clearly as an Integral Part of All Your Marketing
Failure to develop a Unique Selling Proposition (USP) in advertising is almost as common as failing to use direct response advertising. The USP is the philosophical foundation of your business. It's distinguishing advantage is pointed out in all your advertising and sales efforts.
The formation of your Unique Selling Proposition depends wholly on that specific market niche you have already, or wish to carve out. Your USP may be that you provide a diversity of many bloodlines, or choices, for breeding at your ranch. Your USP may be that you offer outcross breeding to Chilean or Bolivian studs. Your USP may be that you offer lower breeding fees or better guarantees than the competition. Our USP is that we provide a traveling stud service.
Failing to Determine and Address Your Customers Needs
Ninety percent of businesses today never precisely determine the needs, desires, or requirements of the people to whom they are trying to sell. How can you expect to adequately fill someone's needs if you never take the time to understand them? Those businesses that do, end up with all the business.
Let's probe the problem of customer needs a little further. To induce someone to favor you with their business, you normally have to offer them some need-filling advantage. Let's review just a few of the possible needs a user of breeding services may want filled. They may want a service that offers convenience, provides guarantees, produces results that will make them more competitive in the marketplace, or offers a stud which will upgrade their herd, add a bloodline, or allow outcrossing. What do your customers need most in the service you offer?
We do not know which need or which combination of needs your potential customer wants more than anything else, but that customer does seek fulfillment of some singular need or combination of needs, and sometimes he does not even fully realize it. Once you find and fill that need, you own your business niche.
In providing our traveling stud service we do not want to waste the time traveling to a ranch if we cannot fulfill that ranch's breeding needs. We work with the ranch beforehand to learn what they are trying to achieve in their breeding program. We gather information on the female and her previous offspring, if any. We analyze the detailed comparative information on our stud's offspring to evaluate how the ranch's female and our stud may match up. We work with the ranch to learn their needs and to let them know what our needs are also. A traveling stud has needs that must be fulfilled by the ranch he is to visit. The ranch will not know about these needs unless we tell them. We schedule the breeding visit at the ranch's convenience, when possible.
If you do not know what needs your customer most wants you to fill, start by recognizing that no one can be all things to everyone. You dilute your image as a need-filler when you try to do that. Determine which needs you can fill, consistent with whom you are, your service offering, and how you operate. Then talk to customers. Experiment with the image you convey in your advertising and promotion. Monitor the consensus and gauge the feedback. Let your customers tell you which specific needs they most want filled, then determine which of these needs you can actually fill. You learn to test experimentally all sorts of ideas and let the market tell you. You do not tell the marketplace.
Then, do not merely fill those needs silently. Make sure your customers, prospects, and your entire marketplace learn that your business listened and that you did something to satisfy the unfilled needs of your customers. Continuously (albeit tactfully) inform, educate, and outright point out that your farm/ranch is filling those needs for your customers.
Change your advertisements to feature these specific need-filling advantages. Point out what you are doing. Send out letters that do the same. Phone your customers and inform them that you are prepared to fill their needs. Once you determine precisely what your customers needs are and you commit to filling those needs, then do it.
If you decide that user convenience is the critical element, offer the most convenient service, the most responsive service, and the most knowledgeable help. If top quality is the need you decide to fill, do not offer a mediocre stud. If you claim to provide a top quality stud, make darned certain you can back it up with the results your stud is producing. If you promise the lowest price, keep that promise. Integrity requires it. If you do not genuinely fill the needs you purport to fill, your customers will soon abandon you.
If you find that you cannot fulfill your prospect's needs, assist the prospect in finding someone who can. The prospect will appreciate your help and remember you the next time. The farm/ranch you refer him to will also appreciate the referral and will return the favor. Marketing in our industry must be cooperative for everyone's best interests.
Not Harvesting Residual Business
Breeders should address the residual part of their business. Until and unless you can identify how much residual business you can expect, you will not know how profitable or unprofitable your advertisement, sale, customer, or promotion can really be. For example, if you spend more on an advertising campaign than your immediate return, are you really losing money? If, with the service you provide, you induce those new customers to contract for additional breeding services on other females or to come back each year to rebreed the same female, you double or triple the value of the customer, and all of a sudden you are into a profit instead of a loss.
Motivate your customers to come back once a year and rebreed the same female and you've set up an annuity. All from the original loss on your advertising campaign, which you subsidized. Within one year the residual business should offset your subsidy.
We motivate our customers by keeping in touch with them. Letting them know what the stud is doing and what the offspring are doing. We provide an inducement in that a user can come back each year to breed any number of females at the same price they bred the first female on their ranch. Wow, what a bargain! They will say to themselves, "Maybe I should breed both of my females." It is no more effort on our part to breed both--just a little more fun for the stud. We get the same money; they get two breedings. Win-Win!
In the traveling stud business we have an opportunity, when at a ranch, to look at the other females that are there. We find out when their babies are due, discuss what our stud has produced with similar females and plant the seed that our stud and that particular female may be a good match. This has led to the breeding of additional females at the same ranch.
Ironically, most businesses rarely try to resell their current or previous customers. This should be done constantly.
Running Institutional Instead of Direct-Response Advertising
Most magazine advertisements and direct mailing pieces are institutional-type advertising. At best, that produces deferred results. At worst, institutional advertising is ineffective and vacuous--accomplishing little. Most institutional advertising tells you how great, old or stable an advertiser is, or some other non-compelling statement. It seldom conveys any reason for the reader to favor the advertiser. It seldom makes a case for the service advertised.
By contrast, direct response advertising's very name is self-explanatory. It is designed to evoke an immediate response or action--a visit, a call or a purchasing decision from the reader. Direct response advertising tells a complete story. It presents specific reasons why your animals and your breeding service is superior to all others, on an analytical, factually supported basis, as opposed to the mere inference used in institutional advertising.
Direct response advertising is salesmanship in print. As salesmanship, it makes a complete case for the sale and service. It overcomes sales objectives. It answers all major questions and it promises results, and backs the promise with a risk-free warranty or money-back guarantee.
Direct response advertising directs people to action. It compels readers to call or visit your ranch. Used effectively, direct response advertising will produce qualified, favorably oriented prospects. At its best it literally compels people to call or write. And, you can analyze the value, profitability, and performance of virtually any direct response advertisement you run because it produces something you can track and analyze.
Institutional advertising will not produce results. If you are running institutional advertisements, change them to direct response. Give your prospects information that's important to them, not you. Give them facts about your animals, your operation and the performance capabilities of your service. Or, tell them about your guarantee. Give them reasons why your farm/ranch is superior to your competitors, on a human basis that the prospect can understand and appreciate. All the prospect cares about is what benefits you provide him.
After you've built your case, tell the reader precisely what action to take. Tell him how to contact you about your service, what to ask for, and who to ask for. Remind him of your risk-free contracting deal, and most important of all, tell him what results he can expect from using your service. Tell him the answers to these kinds of questions and you will own your market.
Forgetting to Focus on the Intended Customer and NO ONE ELSE
How many times have you scanned an advertisement in a magazine and not had the slightest idea what it was all about, or whom the information was intended for? One of the purposes for the headline or opening line is to reach only those who are most qualified to be a prospect for your proposition. If you run your advertisements in one of the llama industry publications and you are advertising breeding services, you should not use headlines or opening statements like "Everyone should use breeding services." Or, "The best provider of breeding services." Or, "Having provided breeding services for ten years..."
Instead, fashion a headline or opening that states the purpose of the advertisement, qualifies the reader and states your proposition. Address your target audience with teaser copy in the headline or the opening line. For example:
"IF YOU ARE LOOKING FOR THAT SPECIAL MALE TO OUTCROSS TO ANY FEMALE ON YOUR RANCH, CALL US, AND WE WILL BRING HIM TO YOU."
Whoever you want to reach with your story or message, be specific. Telegraph your message directly to your prospective customers, and tell them what you are offering. Remember the following points:
 Attract the attention of your target audience in your headline or opening remarks.
 State your proposition or offer.
 Use the rest of the advertisement to develop, support, and present your offer and your reasons why the prospect should embrace it.
 Finally, tell the prospect how to act (what to do next).
Failing to Tell the "Reason Why"
Whenever you run an advertisement, make a specific proposition to a customer, or offer your service at a specific price, always tell the reason why.
Why can you provide your service at a lower price than your competition? Is it that your stud is not as well know or been promoted as well? Why is the price so good? If your price is higher than the competition, again, tell the customer or prospect why. Do you offer a stud far superior to the norm? Does he have a blood line or outcrossing capability that is in demand? Why is the price so high? Does his offspring sell for significantly higher price than the offspring of your competition's studs?
If your price or the package is an especially appealing value, tell why you are making the offer. Is it because you are going to contract with a user for the first time, and it is an exclusive offer to new customers? Or, is it because it is a slow time of year and you want to stimulate additional business from your loyal customers?
Why should a prospective customer patronize you instead of your competitors? Tell what you are doing, will do, or will avoid doing that makes favoring you better than dealing with someone else.
The more factual, believable, credible, and plausible reasons you give for dealing with you, the more compelled a prospect will be to favor you.
Not Testing
The purpose of testing is to develop maximum performance from every marketing effort. Yet it's amazing how few farms/ranches ever test any aspect of their marketing and compare it to something else. They bet their destiny on arbitrary, subjective decisions and conjectures.
This is sad for a number of reasons. First, we do not have the right or the power to predetermine what the marketplace wants and what the best price, package, or approach will be. Rather, we have the obligation and the power to put every important marketing question to a vote by the only people whose ballots count--customers.
How do we put a marketing question to a vote? By testing one sales thrust against another, one price against another, one advertising concept against another, one headline against another, and one follow-up or up-sell overture against another.
The point is--and this is not guess work--when you test one approach against another, and carefully analyze and tabulate the results, you will find that one approach almost always substantially out-pulls all the others by a tremendous margin. You will be amazed at how many more sales you can realize from the same effort.
Test every sales variable. You can easily achieve immediate increases in sales and profits. Any positive or negative data can help you dramatically improve your sales efforts. Test different directives to the reader on how to respond to your advertisement. Test positioning in the front, back, right, or left-hand side of the page. Test where your advertisements run.
Test your prices. Different prices often outperform one another. Why does one price out-pull another? We do not know. Probably for a lot of reasons--psychological image of value, perception of quality, etc.
Make specific offers and analyze the number of responses, prospects, and resulting sales for each specific advertisement. Then compute the cost-per-prospect, cost-per-contract and the average conversion-per-prospect. Compare the results. This reveals the obvious winner; the advertisement or mailing piece that you will keep using until a change does better.
Forgetting that You Have to Educate Your Way Out of a Business Problem
How do you get yourself out of a problem where your service is just not selling (e.g., a particular time of year is bad) or you are not generating many new customers? The answer is so basic and simple--and obvious--you will laugh. Tell your customers and prospects the truth. Telling the truth in advertising is very disarming!
If you have a stud available for outside breeding, but no one is asking for him, write a letter or magazine advertisement that tells your customers and prospects that:
 You have a stud available for outside breeding.
 The stud will provide benefits to the ranches that use him (itemize the benefits).
 You are interested in providing the service at the convenience of the user.
 The stud's quality, conformation, offspring, etc. are tops.
Then tell people what other providers of breeding services would normally offer a comparable breeding for, and tell them your price (lower than the competition) or offer a reduction for breeding multiple females.
Then tell the prospects why you are providing the service so cheaply--the real reason--but with a delightful embellishment. For example, tell the prospect the truth--that you have a stud available for outside breeding and things are very slow this time of year, so you will offer a discount. Add to that explanation a parenthetic exclusive qualifier like...
"We offer this discount to our best customers as a reward for your patronage." Or, "We are only making this offer to new users of our service."
An important point--in fact, it's vitally essential--is that your customers will not understand or appreciate a value, or a bargain, or a service, or a benefit, unless--and until--you first educate them to appreciate it.
Merely offering a service at a specific price (even the best price) does not generate excitement or a response until you tell people what they are getting, what a value it is compared to other comparable services, and why you can offer such value. This applies to any problem.
One of the problems we had when we began providing breeding services was that we had an unknown stud. We did not spend tens or hundreds of thousands of dollars to purchase a known stud. We had a Chilean herd sire that had the quality of the other top studs, but was unknown. We waited until we had our own offspring on the ground (only three). We needed many more offspring to show what the stud could produce. With our small herd there was no way to produce enough soon enough. With outside breeding we could increase the number of offspring.
Who would risk breeding to him? We began to promote him locally and offered his services at half the current rate. As a kicker, we offered to bring him to their ranch to breed--providing convenience to them. We also provided a guarantee that was better than anyone else was offering. And, as an added bonus, because they were willing to risk their female on an unknown stud with not much to show, we told those who contracted for him that this original price was the price they would keep for the service no matter how high his price went for as long as we had him standing at stud. This was also setting us up for repeat business. Next year, and the following, when the stud's price was double, and you could still get it for half--such a bargain!
When your business has a problem (say you have already received the breeding fee) and something goes wrong, preventing you from fully or promptly or properly providing the service, never ever fail to acknowledge your problem. That is the sure way to commit integrity suicide. Be up-front and honest. Call, write, or individually approach your customers and apprise them of the problem. Tell them precisely what you were supposed to do and tell them why you cannot fulfill your obligations. Tell them with certainty when and how you will be able to perform.
When our herd sire died suddenly, we were faced with a problem of not being able to fulfill commitments on breeding guarantees and donations of breedings that were auctioned off for fund raising. Within two to three days we had contacted everyone we owed a commitment to. We offered to replace the breeding with another stud or to refund their money.
Because the people we have been dealing with are so great, and we have always tried to be honest and fair in our dealings, most everyone elected to use the replacement stud we offered. This was fortunate for us. If we had been forced to refund all the breeding fees we were obligated for, there would have been nothing left out of the insurance money we received (it was little enough as it was). One thing we learn over and over again. If you treat people fair and honest and always try to be helpful, when you are in need, they will come through for you.
Failing to Make Doing Business with Your Ranch Easy, Appealing and Desirable
It surprises us somewhat that farms/ranches do not put themselves in their customers or prospects position. When people come to your farm/ranch, how well versed are you in their need? How much time have you spent in preparing dialogues, questions, and advice to offer the potential users of your service? How willing are you or your staff to answer questions and provide truly informative advice, even if it does not directly or immediately benefit you?
How conscientiously do you follow up on requests for information and inquiries into your service? How well do you keep customers informed on what your stud is doing and his availability? How much do you take your customers, prospects, and business for granted? By merely stepping off your ranch and walking up wearing the hypothetical shoes of a prospect, you may see a lot of flaws in your operation. Once they are remedied, you can dramatically improve your current and repeat business potential.
By making it inviting, easy, informative, non-threatening, educational, and inspiring to do business with you, you will lift your sales efforts above your competition. Remember:
 We cannot service too much.
 We cannot educate too much.
 We cannot inform too much.
 We cannot offer too much follow-up, or follow through too far.
 We cannot make contracting for our service too easy.
 We cannot make calling or coming to our ranch too desirable.
Not Sticking With Marketing Campaigns That Are Still Working
Many farms/ranches change campaigns indiscriminately in midstream. In the process they:
 Do not let the cumulative effect of a winning concept work for them (it is akin to interest compounding).
 Do not allow the dynamics of testing to work for them.
 Make a patchwork quilt of their farm's/ranch's image and persona.
Businesses get tired of their advertising and marketing campaigns long before the marketplace ever tires of them. Remember the tenets on testing. Test to find out which advertisement, marketing, or sales approach works. Continue to experiment with new ideas and change or alter that approach only when a new concept outperforms the previous one.
Most advertisements produce only a modest percentage return every time they are run. You should expect no more than a .5% to 3% response from your direct response advertising. When you are tempted to abandon a winning, producing, profitable approach that you are tired of, try to develop new approaches using a related or similar view. If you have found the combination to your customers' responsiveness, keep going until the combination stops working.
Summary
Keep your marketing simple. Carve out a market niche. Establish your Unique Selling Proposition and state it clearly as an integral part of your marketing. Determine the needs of your customers. Do not take them for granted. Educate them about what you can do for them. Establish cooperative marketing programs with other farms/ranches. Harvest residual business. Use direct response advertising. Give the potential customer a reason to favor you--make a case for your operation. Focus on your intended customer and no one else. Always tell the reason why. Test all aspects of your marketing and analyze the results. Tell your customers and prospects the truth. Make doing business with you easy and desirable. Stick with a winning marketing campaign and enjoy the fruits of your hard work.
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