So I received a letter the a few months back from my accountant offering ‘Tax Audit Protection’ - As you can see from the attached letter the investment would only cost $22 and protect me for upto $1100 worth of costs if I was audited. Not a bad insurance policy to take up at such a low price, I am sure a large number of this accountants clients took this offer up. For those of you who have read about Maslow’s Hierarchy of Needs - Safety (Security/Protection) is very very important to people and one of our core needs.
Lets look at it from the Accountants point of view - Firstly from an cost balance of view. They will need to sell 50 ‘policies’ for every audit they need to complete. I am not sure of the odds of people getting audited but I would almost bet it’s less then 1 in 50…. Obviously the Accountant can look back trough their records to see what % occurred in the past, to make sure the bases are covered.
Secondly, what are they really selling? Well unlike most services accountants offer - they are not selling time? Generally you pay the account for their time to complete a BAS statement, File a return etc etc. As the $22 is not covering a direct effort on the accountants behalf, it’s merely a opportunity/possibility. If the account sold 1000 of these to their large client base, that’s $22,000 of additional income they would otherwise wouldn’t have had.
How can you do the same in your business?
- An ‘All Purpose Tradesman’ could sell call-out protection; For $250 you are covered for 10 hours of work if/when needed in the next 12 months.
- An ‘Auto-Mechanic’ can offer a labour protection: If your car breaks-down in between scheduled services, $88 will cover the labour to fix the job.
What creates turnover? Sales? Customers?
Well if you breakdown how turnover is calculated you will find:
Turnover = # of customers x # of transactions per customer x $ spent per transaction.
So if you have 2000 customers each purcasing from you twice per year and spending $100 per sale you would have a turnover of $400,000 - not a bad business.
So what would happen if you were able to increase each area by 5% - just 5%.
Thats 2100 customers each purchasing 2.1 times and spending $105. Thats a $463,050 - an increase of 63,050 or 15.76%. So by increasing the business drivers by only 5% your turnover will grow by over 15%.
Ok so how do you actually grow those drivers..
Well most people focus on growing the # of customers by simply advertising… By often forget about the other drivers…
You can increase the number of transactions by putting in place a frequent buyers system like subway’s stamp club..
You can increase the # of items purchsed by following McDonalds and simply asking ‘would you like fries with that?’
You can increase the $ spent by again following McDonalds asking ‘would you like to supersize that order?’
This is a brilliant marketing piece Virgin Mbile attempted to run in the UK - unfortunetly it was banned as it was believed:
1. it was likely to cause serious or widespread offence;
2. it was not sufficiently clear that the insert was advertising material;
3. the tone of the insert could cause undue fear and distress; and
4. it could encourage children to emulate the language used in the insert.
Read more about it at: http://www.bestrejectedadvertising.com/ban/I.html
What do you do in your business to keep the customers hanging around?
Its amazing but on average 94% of marketing budgets are designed to get the customer to make inital contact (phone call and or comming into the store) with little effort effort or focus on when they do.
Once they are in the store you have only won half the battle, you need to implement systems and stratergies to maximise the actual interaction.
One ‘retail’ store I know of offers all their customers a cup of coffee - its a brilliant stratergy as each client now has to ‘linger’ in the store while they wait for the coffee to be made, wait for the coffee to cool to drinking temperature and then actually drink it…. Imagine what would happen to your bottom line if all the people who walked into your store stayed for 3-4 times as long???
Ok, so not your average post or marketing medium for that matter - but it is very creative and targets a “captive audience”. We all know if you can target a captive market and get them to interact with your message you have done very very well.
This one is for ESPN’s football (soccer) channel.
This one is for the MINI with the tagline reading
‘Test your handling skills” … and yes they are mini witches-hats in the bowl.
Here a couple of other bathroom related pics - not really advertising anything but they made me laugh.
So I received a letter the a few months back from my accountant offering ‘Tax Audit Protection’ - As you can see from the attached letter the investment would only cost $22 and protect me for upto $1100 worth of costs if I was audited. Not a bad insurance policy to take up at such a low price, I am sure a large number of this accountants clients took this offer up. For those of you who have read about Maslow’s Hierarchy of Needs - Safety (Security/Protection) is very very important to people and one of our core needs.
