Thursday, March 11, 2010

I was having coffee with a business owner last week and he asked me an interesting question – he asked to to share what I thought were the 3 most common mistakes made by businesses when it comes to marketing.

I smiled and took a slow sip of coffee so I could gather my thoughts. And after a few seconds, I gave him these 6 mistakes:

Poorly defined target audience. This is the “Mother of all Problems” when it comes to marketing because if you don’t know who you are trying to reach and speak with, there is a trickle-down effect that impacts messages, offers, media and lists…

The most common problem is keeping the target too broad – you can’t be all things to all people, so focus on being the best possible solution to a need for a smaller group so you can generate responses and sell products.

Let me give you an example – your local neighborhood white tablecloth restaurant specializes in northern Italian cuisine and offers a remarkable wine list. Their target audience is NOT anyone who eats – it should be geographically targeted (ex. within 10 miles), demographically and psychographically targeted (ex. household income, owns more elite credit cards like AMEX rather than Discovery, subscribes to wine magazines).

So, if they invested marketing dollars to attract ‘anyone who eats’, the chances are they will attract too many people that can’t afford to eat at the restaurant or who don’t like northern Italian cuisine or wine.

Focus on features instead of benefits. People buy solutions to problems and airbags in your car are a feature but the safety of your family is a benefit. Unfortunately, when you aren’t sure of your target audience, you have trouble focusing on the right benefits.

For our Italian restaurant example, would you focus on the convenience of the location to their home and that only locally grown organic ingredients are used in order to deliver remarkable flavor in a healthy meal? Or would you focus on “large portion sizes”?

Weak offer. This typically follows a promotional effort that is poorly targeted because you really can’t create a valuable solution for a group of people that you can’t really describe. For example, some prospective buyers will be price sensitive, others will pay a premium for a 100% guarantee or faster access to the product (delivered to your door within 24 hours).

Again, going back to our Italian restaurant – do you think price is the issue or might it be value and experience? So would offer 20% off any meal any time? Or would you offer a romantic prix fixe five course meal that is designed for you by our chief?

Wrong media and lists. On top of having the wrong messages and offers, a poorly defined target audience typically produces a poor selection of media and lists. In other words, too many businesses aren’t reaching the most likely buyers of their products and services.

Would you be buying a full page ad for our Italian restaurant in the morning paper or would you send a small package with a personal letter from the chief and owner that invites you, our neighbor, to join us for your next meal and includes 2 small cookies baked in your kitchen?

Poor response. I know I repeat this one – but the overwhelming majority of businesses will ignore 80% of the leads generated by marketing and 60% to 80% of those ignored leads will buy the products you sell within the next 12 months.

Why? Because your sales team focuses on those that want to buy today – which accounts for about 20% of your leads – and doesn’t worry about qualified buyers that are planning to buy in the near future.

With our Italian restaurant, I would suggest failing to respond to your request for a reservation – there’s nothing more fun than calling and having no one answer so you leave a message and never get a call back.

No performance tracking. More than 50% of all businesses cannot tell how their promotional efforts worked – or failed to work. This lost opportunity to learn means they cannot learn from past failures and successes.

Marketing is about producing profitable sales and the best way to produce more is to learn what works, what doesn’t and why so you can improve over time.

So, what do you think? Did I miss anything? Get any creative juices flowing? Remember to share your thoughts, comments, similar experiences…

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