I attended a WebiNar about marketing last month. It was fantastic! After attending, I was so excited I had to write an article about this WebiNar.
When sales are down, companies tend to decrease their marketing expenses. This is a mistake at the highest level. It is so easy for companies to enter into a downward spiral that only leads to lost sales. When profits are down businesses look at the short term goals, forgetting that it is the both short and long term goals together that are important. When sales are down, marketing needs to increase.
The first step is recognizing a downward spiral before it gets too strong. Understanding how to stop the downward spiral must begin with attitude. Work from a state of success and not fear. Today the marketplace is controlled by fear. Whatever your business venture make sure you spend quality time working on some aspect of your business every day. Do this each day and it will quickly become a habit!
How do you identify a downward sprial? It can be a little daunting and scary at first, but it is important to be honest. These are a few questions to ask:
• Are you pulling back on advertising?
• Are you using words that define fear
• Are you withdrawing from associates, associations and new products?
• Are you afraid of your competitors?
• Are you cutting prices without knowing why sales are down?
• Are you changing your pricing structure?
The second step is to stop the downward spiral before it is too late. You can do this by creating a success team. A success team is a group of business associates that desire to succeed. You do not want everyone around you that sees the world as you do, nor do you want them to be in the same business! You need diverse, committed, creative and effective business associates. Meet with them monthly to discuss business goals and realities. A success team should motivate each other by assessing progress, critiquing plans and expanding networks. Each differing perspective can generate fresh ideas and set them for success.
Third, you want to analyse your business and write a practical action plan. There are 12 steps to any successful business.
• Personal understanding ~ Know the differences between sales, revenue and profits
• Product development ~ Product extensions are important
• People skills ~ You ability to read buying habits and plan accordingly
• Positioning ~ You uniqueness is your specific market
• Packaging ~ How to sell your uniqueness • Promotion ~ You have to continue doing something every day!
• Persistence ~ Remember, your attitude determines your altitude! • Persuasion ~ You are the leader, not the follower
• Placement ~ Timing is the Key to proper placement
• Planning ~ Pocket Guide for Marketing Plan
• Pricing ~ Create a Sales Forecast ~ Create a Quick Cash-Flow
• Profits ~ You Are Successful
Focus on understanding the differences between sales, revenue and profits. Many small businesses seem to recognize these three units as the same, but they are not. In fact, they are very different. Understanding these terms will assist you in knowing what your objectives need to be when you are in a downward spiral.
First, increasing unit sales. Ask two basic questions ~ when & why. When Are Sales Down? Record keeping will help you succeed and plan. What you may see is that sales are down Jan-Mar but up in June, then down Jul-Oct and up in Nov/Dec. Many will cut prices automatically without looking at the why's.
Why Are Sales Down? Do an honest evaluation. Is the product you are selling bad or wrong time? Is your specific market in decline, or is the product new? Was it poor planning or implementation of a plan? Was it due to lack of promotion or the wrong promotion? When you do an honest evaluation, you start to detect trends in why sales are down.
Spend money wisely. When you look at your sales graph for the previous year and see large peaks then flat lines, you realize promotions are off balance.
Revenue becomes critical when you need to expand the volume sold. For example, if you sell fabric and you see sales down you could increase revenue by attracting new customers. Another way is by changing the order size or giving quantity discounts. Increasing revenue considers how to expand an existing product line. It also keeps in balance the number of products you have to sell. Bringing in a new product will increase revenue or changing the way you package an existing product.
Increasing profits is what everyone things of first. Increasing profits could mean generating cash before incurring costs. An example is pre-sale orders. Bundle products together to promote them as a package. Lowering or adjusting your costs can grow your profits. Just make certain your quality will not be compromised. Pooling certain marketing activities is one of the best ways to increase profits. Take advantage of every opportunity to promote your store or product!