Sound ADvice | The Genuine ScLoHo aka Scott Howard

Transactional vs Relational Customers

by Scott Howard | Aug 4, 2021 | Marketing and Advertising Insights, Sound ADvice, The Not-So-Secret Writings of ScLoHo, WOWO Fort Wayne Radio Advertising with Scott Howard

One is more profitable. One is more needy. Both are important to the overall success of a business. Understanding how to identify each type and how to turn transactional customers, when possible, into relational can be a huge boost to your business.

Every business has basically two types of customer profiles:

1.) Transactional Customers
       – Only care about price
       – Have no brand or business loyalty
       – Demand more, but pay less
       – Consider themselves buying experts
      – Often return merchandise or complain about service when they discover the “cheapest” solution was not the best solution.

Warning:
Don’t confuse “traffic” with sales. Because transactional customers contact you so often per purchase, their “traffic” can cause you to think the majority of your customers care only about price. Seldom is this the case.

2.) Relational Customers
     – Want a salesperson or expert they can trust
       – Need help and advice
       – Are more loyal to brands and businesses
       – Are less demanding and more profitable
       – Become repeat customers

Relational customers make fewer visits per purchase than transactional customers but generally account for a minimum of 50% of sales and more than 70% of profits.

The Bottom Line

We attract the kind of customers, relational or transactional, by design. If you would like to design a more profitable business and attract more relational customers, click here to see our Profitable Customer Marketing Checklist.

What I just shared with you arrived in a few hundred peoples email this morning. It’s this weeks edition of my Sound ADvice newsletter and you can have it delivered to your inbox too by filling out the info in the Sound ADvice newsletter box below.

Let me take a moment add a few more insights.

All of us have a little bit of transactional and relational buying habits in us as consumers. All depends on the item or service we are considering spending money on as to what our priorities are. The problem I see that too many businesses don’t understand is that they think price is a higher priority than trust when we are spending money.

Several years ago, I was doing a Customer Needs Analysis with a HVAC dealer and he was talking about their quality and experience and all these great things that were relational. But his marketing was focused on offering discounts and I asked him if he liked giving away money. He was a little insulted until I challenged him to market his company the way he talked to me. He was afraid to because his competition advertised price discounts and he was playing follow the leader.

I talked to another HVAC dealer and got them to minimize the discounts in their marketing and focus on trust and expertise. They took my advice and saw their sales double over time.

Want help figuring out how to market your business and you are in northeast Indiana? Contact me. I’ve been doing this successfully for years and am currently the General Sales Manager of WOWO radio. My team and I will be glad to help. Scott@WOWO.com is my email.

The Value of a Single Customer

by Scott Howard | Jul 21, 2021 | Marketing and Advertising Insights, Sound ADvice

When a person walks through the doors of your business, in-person or online, and purchases something from you for the first time, at that moment, they become your customer, your patient, or your client.

The question is, what is the value of that individual to your business or practice? Is it the amount of profit from this one-time purchase or, is it the potential lifetime value they create?

Most experts will tell you that the cost to acquire a new customer is ten times more than what it costs to keep them.

With that said, most successful business owners have a well thought out advertising plan, or at minimum, an advertising budget intended to acquire and attract “new” customers, but very few have a plan to keep their “current” customers, patients, or clients.

Since we agree that keeping them is far less expensive than acquiring them, understanding the true Lifetime Customer Value should be enough to persuade you to at least consider implementing a plan to keep them.

There are 4 factors we need to consider when calculating a “Lifetime Customer Value”:

1) Average profit per individual sale including upsells and add-ons

2) # of purchases per year

3) # of years they will remain a customer

4) Word-of-Mouth – average # of people they persuade to do business with you

Paid media advertising is the best way to acquire new customers. Word-of-Mouth advertising is the best way to multiply your customers, and over-the-top customer service is the best way to ensure your customers become repeat customers.

Understanding the “Lifetime Value” of your customers will inspire you to create a strategic plan to serve each customer with more passion.

Click here to get our Lifetime Customer Value Worksheet to help you calculate the LCV of your customers.

Subscribers to my Sound ADvice email newsletter received this information in their inbox last week and you can too. Just sign up, free in the form below.

Media or the Message

by Scott Howard | Jul 14, 2021 | Marketing and Advertising Insights, Sound ADvice

In the never-ending maze of online media, on-air media, outdoor media, direct mail, and print media, business owners often ask, “Which media work best?” or, “Which media platforms will give me the highest return on my investment?”

If you ask an honest and knowledgeable media person, they will tell you that the media isn’t necessarily the most important criteria when it comes to effective marketing. The truth is, there are no media that will not produce results, there are only messages that do not produce results.

The next time you hear about a hugely successful ad campaign, look at the message. I can guarantee you it was profound and something other than the norm. Seldom will it be the media, but rather the message, that created the results. Of course, the media must be scheduled appropriately, with the right combination of reach and frequency, but it is the relevance of the message that will make consumers respond to a campaign… on any media.

Former Katz Marketing Solutions President and one of America’s smartest marketing minds, Bob McCurdy says, “No medium is any more captivating or engaging than any other, as the effectiveness of any medium is largely determined by the quality of its commercial content. If the creative is weak and ineffective, the medium will be thought of as weak and ineffective”.

It’s understood that generating great creative is an art form but there’s some science behind it as well. McCurdy created 14 key creative insights derived from five years of Ipsos Research, spanning dozens of radio commercials and thousands of respondents.

Click here to receive McCurdy’s 14 Key Creative Insights to ensure that your marketing message achieves the results you desire.

What I just shared with you is from the Sound ADvice newsletter that I send out nearly every week, you can get it delivered free to your inbox by signing up in the box below.

I actually disagree with a couple of items that Bob McCurdy says, but that’s only because of the experiences that I’ve witnessed with advertising partners on my radio station WOWO, in Fort Wayne, Indiana.

Some forms of media can be superior to others and can overcome a mediocre message. Yes, I’m referring to WOWO with our news talk format, having local hosts and nearly a century on the air, WOWO has undergone tremendous changes over the decades but currently has the largest audience, by far of all 30 + radio stations according to the rating data I get each month. More important than those facts are the benefits I see every month of our listeners becoming customers of our advertising partners and the WOWO connection often cements the deal. Want more info? Contact me, Scott@@WOWO.com.

Set The Bait

by Scott Howard | May 5, 2021 | Marketing and Advertising Insights, ScLoHo's Collective Wisdom, Sound ADvice

Whether it’s fishing, hunting, selling, or advertising, setting the bait is key to alluring or attracting that which you are trying to capture.

Since the beginning of time, it’s been known that you only have one opportunity to make a good first impression and regardless of if it’s a fish, wild game, or humans, you don’t have very long to capture their attention.

Your advertising message faces the same challenge. What your ads say, how they sound, and how they are delivered in the first few seconds, dictates whether your potential prospects will tune in or tune out to your message, or continue to read the message.

Reporters and authors have long known that the headline and the first sentence are what dictates whether the reader tunes in and continues on with the rest of the story, or tunes out. In an effort to develop the all-important “creative hook” at the top of your ads on websites, many headlines end up with more “creative” than “hook”.

In order to get the maximum effect out of your ads, we recommend you carefully consider the first few seconds of every ad, blog, text, email, or post that you create.

Here is a bonus tip. Oftentimes, you will find that the best line of any ad or letter, or the best words/sentence, is in the middle. When you find it, move it to the first line, or use it as the headline.

To read the 8 Power Openings you can use to capture more attention for your marketing efforts, click here.

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The Voice Of Your Business

by Scott Howard | Apr 15, 2021 | Marketing and Advertising Insights, Sound ADvice, The Not-So-Secret Writings of ScLoHo, WOWO Fort Wayne Radio Advertising with Scott Howard

Today I’m going update a topic that I’ve spoken on previously.

Who is the Spokesperson for your Business?

Yes, it’s the people who answer the phone, who greet the customers, and the ones that interact face to face or online. But that is different.

I’m referring to your advertising and marketing.

For many of the best-branded businesses in the world, one thing usually stands out and once people hear it, they immediately know what business it is.

Flo and Jamie are two of the fictional character actors that represent Progressive Insurance. Yet, Progressive uses others too.

There’s Jake from State Farm who is just an actor.

The My Pillow Guy was famous for awhile and then when he became political, he offended a whole bunch of people with his passionate support of Donald Trump and election fraud. I had to look up his name, Mike Lindell. He is a classic example of how not to market your company by jumping into the political arena unless you are prepared for the consequences.

But I’m getting off track here.

Some of the most effective marketing successes in history, both locally and nationally, have involved capitalizing on the voices, faces, and personalities of charismatic and humble business owners and corporate leaders.

In decades past, nationally, you may recall Chrysler’s Lee Iacocca or Wendy’s humble founder Dave Thomas. More recently the spokesperson for Quicken Loans was their President and Chief Marketing Officer Jay Farner. In these cases, and many more, consumers have responded positively to the credible messages delivered by real people.

However even these three companies have diverted from what was once a successful advertising messaging campaign tactic. 5 years ago Quicken Loans launched Rocket Mortgage and pretty much abandoned what made them unique in their industry, although thru an online search, I found Jay Farner in a one minute video ad talking about what Rocket and Quicken are doing with regards to the economic hardships many faced during the COVID-19 pandemic.

Locally, you see and hear business owners voice their own ads, some of which are fantastically real and have moved their business from mediocracy to hometown heroes, and from rags to riches. On my radio station WOWO radio, we have several business owners that voice their own ads.

People buy from people they trust. It’s that simple. But if you don’t come across as real, trustworthy, and humble, the chances of you going from local to national are slim.

Two of the ten tips for being front and center in your campaigns are:

1.) Check your ego at the door. Only voice your commercials or have quotes and photos of yourself in your advertising if it is strategically correct to do so from a marketing perspective. It’s not about hearing your own voice or having mom see your picture; it’s about bringing believability and memorability to your campaign.

2.) Introduce yourself as the Owner, CEO, or President. There is NO reason to either voice the ad or be in the video if you don’t introduce yourself.

As the owner or president, you don’t need to be better at voicing the ads than a disc jockey, actor, or actress. You simply need to serve the purpose of you doing the ad, and that is to become the voice or face of the company. If you cannot add purpose, hire a gecko, create a fictional character, or let someone else do it!

Nothing sells like the human voice and using your own voice and words can make your campaign stand out against a hoard of ads produced by professional, anonymous sources.

Click here to view the rest of our 10 Tips to Being Your Company Spokesperson.

And to get more Sound ADvice business tips like this, sign up for my weekly newsletter, free from me to your inbox, using the form below.

Aiming at the Wrong Target

by Scott Howard | Mar 24, 2021 | Marketing and Advertising Insights, Sound ADvice

Too many business owners aim their advertising at a single target. While that may have been a decent strategy twenty years ago, today, by narrowly aiming at a select group, you may be missing a much larger potential audience.

The goal of advertising should always be one of two things and in most cases both; it should be to increase sales AND build brand awareness. But all too often we get hung up on targeting very specific demographics when creating our media plans.

For example, it might not seem only reasonable for a baby-products retailer to target “women 18-49 with infants”. But according to the market research firm Scarborough, nearly half of those who bought infant clothing, 47%, were from households without children.

When it comes to grocery shopping, whom should you target, men or women?

The assumption is women do most of the grocery shopping. But do they? The answer is yes… and no! Statista research from 2020 will tell you that the primary shopper in the average household is 65% women and 35% men. However, in households where the grocery shopping duties are shared, men do 59% of the shopping compared to only 41% of the females. Furthermore, 70% of all secondary shopping is done by men.

Scarborough Research also found that nearly a quarter (23.5%) of all women’s cosmetics and perfumes were bought by men.

In his Twelve Causes of Advertising Failure, Roy Williams wrote. “The importance of qualitative data has been grossly overestimated by many advertisers and media professionals. In reality, saying the wrong thing has killed far more ad campaigns than reaching the wrong people. It is amazing how many people become ‘the right people’ when you are saying the right thing.”

Thinking beyond the traditional demographics your competitors are ‘targeting’ with their advertising can help you reach untapped markets to increase your sales.

Click here to read how to reach and influence “purchasers” rather than “demographics”.

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