Question

Topic: Strategy

New Ideas For Marketing To Trade Customers

Posted by Jon Hungerford on 4/15/2013 at 9:38 PM ET 250 Points
We work in the solar and electrical components industry. Sales are quite down in the last 4 months, mainly due to the volatile nature of the solar industry as far as we can determine.

We currently market to our existing customers by phone every 2-3 months, which we find has a good response. However, my business partner feels that we're not doing enough "marketing", and that our customers aren't getting contacted regularly enough, or aren't made aware of new products or promos quick enough.

His solution is that we start a weekly email blast to all our existing customers, and he is quite insistent on this.

I just don't feel that this is marketing as I've been learning on this site and other resources.

So I'm asking for some marketing ideas that are regular, but relevant and timely, and less "spammy". Any suggestions appreciated.
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RESPONSES

  • Posted by modza on 4/15/2013 at 11:27 PM Member
    There are three issues that come to mind: 1) your difference of opinion on how frequently existing customers "should" be contacted - as well as how; 2) your assessment of the cause of the decline, and 3) what's missing. Let's start with the first:
    1-A: I'm not sure what your objection is based on, but if your partner wants something this badly, that doesn't cost much, why are you so resistant -- even if you think it isn't "marketing" and you think he's wrong? Partners have to give and take. You need to look at how strongly you two feel. I would guess you're feeling stress from the situation. But you should work to find a way through such strong disagreements, where you're not betting the company.
    1-B: Email newsletters, are, I'm sorry to tell you, a very common and successful way of marketing, very much of the moment. Email, despite frequent reports of its imminent demise, is very much still with us. (You should look at some marketing statistics, say at Hubspot.com.) The things to consider are: a) do you really have new products as often as your partner says? If so, why would you wait to introduce them? b) If so, can you make sure there is a strong call to action in the newsletter? In other words, do you have or have access to an experienced direct email copywriter? You should be able to measure visits to the product pages on your website (you do have a way for people to buy online, I hope), or at least phone calls from each item. c) Technology: this is by far the easiest. ConstantContact, MailChimp, Emma, and other email marketing firms make it as easy as imaginable to send regular emails: templates, tracking, automatic opt-out (very important), etc.
    2) Your assessment of the decline: I follow the solar business from a distance, and I'm not hearing what you're hearing. Sales are up as panel prices fall -- it's not a good time to have inventory of panels, but racks, inverters, and installations are still going strong. The withdrawal of incentives is being matched by an increase in financing alternatives. I would use your telephone salespeople to find out if their customers are buying elsewhere, and read a wider variety of sources of industry news. I assume you read Solarbuzz?
    3) What's missing: you've said nothing about acquiring new customers. Why not? Yes, existing customers are gold, and you want to treat them well (which can include giving them the freedom to read about your new products at their leisure (email) instead of being trapped in a phone call), but customers are not rocks. They merge, move, retire, die, are seduced by competitors. You must have a strategy for replacing attrition at the very least. But the most successful companies are always looking to grow, not maintain. I'm not sure what that might mean in your case, but I'm willing to put my mind to it, if you're interested.
  • Posted by Jon Hungerford on 4/16/2013 at 1:12 AM Author
    Modza:

    Thanks for your thoughtful response. I'll just clear up a couple of points quickly before I get into more detail about your answers.

    1. My business partner is actually my twin brother. Which means we probably disagree more than most business partners :), but it is an ideal situation for honest, open discussion about what we think or feel. I didn't mean to phrase the question to make it look like there was tension between us, or that I think he's an idiot. We've been in business together for over 10 years now, and our relationship has only gotten stronger.

    2. I'm a strong believer in email as a marketing tool, I've used a combination of Mailchimp and Infusionsoft for years now. Unsolicited, spray-and-pray type broadcasts I'm less of a believer in.

    So now, to go a little more in depth:

    1. One of my main concerns with unsolicited weekly email blasts is that it could annoy and alienate our customer base. Based on previous experience with this business and others, electricians have strong feelings about spam email (understandable). We actually used to do a monthly email newsletter, and we discontinued it because the response rate (opens and clickthroughs) declined to pretty abysmal levels. How much more so weekly emails?

    Of course, the poor reception could be due to poor email content, I've got no doubt.

    We bring in a new product range about every 2 months or so at the moment. Our sustainable goal is one new product range every 3 months. Specials, clearances and other promos would be about every 1-2 months.

    Of course, we also want to showcase some of our other product ranges that our customers may not be aware that we have.

    We don't have an online store for this business, mainly because the orders tend to be larger (ie. in the 10 thousands), and generally require some sort of needs analysis process from a salesperson. Our goal is to get them to contact us either by phone or email.

    Yes, we track interaction and website visits with a combination of Mailchimp's analytics, Google Analytics and Kissmetrics.

    I'm no stranger to email marketing, analytics, etc. I just didn't feel a weekly email blast was right for this particular customer segment, and I was fishing for some other ideas. I think I need to expand a little on what this particular customer segment is, which I will after I've answered the other two points.

    2. Not sure where you're based, Modza, but there's no doubt that the Australian domestic PV market is in quite a severe short-term slump at the moment. There's several factors being blamed for this, of which probably the biggest is the government rebate and tariff cuts at the start of this year. But just to give you an idea, our sales for January/February/March were about 1/3 of our sales for October/November of the previous year. Considering our customer base has actually grown by about 50% since December, it's a pretty clear indication that people aren't buying as much as they used to.

    As I said, it seems to be short-term only, our customers are indicating that it will take off again in the next 2-3 months. We're just looking for some short term strategies to help cash flow.

    3. New customer acquisition is very important to us, we have a whole sales division devoted to that. As I said above, our market share in terms of number of customers has grown by about 50% in the last 4 months.

    So now just to elaborate on our customer segments a little:

    We have 3 levels, A, B and C (quite imaginative, I know :)). A customers are distributors and onsellers, who receive regular phone calls and weekly emails. B customers are large end users, who receive regular phone calls and emails. C customers are small end users, who generally receive a phone call every 2-3 months.

    A and B customers are fine. It is the C customers that we were trying to reach a bit more regularly, to make sure we are getting what we can out of them.

    My other main concern with regular email blasts to C customers is that some of our C customers are most likely also buying off some of our A customers. A phone call every 2-3 months is pretty low key, and unlikely to upset our A customers. An aggressive email marketing campaign, I'm not too sure.

    So what I'm looking for is some ideas on ways to regularly market to our C level customers, without upsetting our A level customers, and using methods that are quick and cheap.

    Simple, no? :)
  • Posted by Moriarty on 4/16/2013 at 2:49 AM Accepted
    You're using Infusionsoft - one of the best email systems on the planet. If you are contacting your customers through them, they will have signed up voluntarily. That means your content is the problem - and I'm doubtful about the phone calls. They take time out of your customer's days.

    What responses are you getting to them? If they aren't interested immediately, then you are wasting your time and money.

    Email is much more "passive" and the recipient can open it when they like - BTW what is your open rate like? The point is that your email content needs to be informative, interesting and chatty. Aussies can do all of that. The one thing you don't want is sales patter as this drives people away. The point of long-term email (in my book at least) is to keep a line of communications open to what are otherwise dormant clients. So just send out relevant interesting stuff every so often and let them do the rest.

    Are you sending too many emails? See what your open rates are by having weekly, fortnightly and monthly emails sent to slices of your email list. Find out what the open rates are like in six month's time. In other words, put the question to THEM not us! They're the ones buying, not us!

    What are your competition doing? How are they faring? I'll bet that not one of them has an email autoresponder/list let alone one with Infusionsoft. My bet is that they're doing a lot worse than you as a result.

    You have A, B and C customers. Actually, that's fantastic. Boring classifications for sure, at least you've got them! Goodness, the number of people who just sit there and expect customers to turn up at the door, speak to every passing dog-walker as if they were their next star client! Believe me, having As Bs and Cs puts your business on a far surer footing than almost any other because so few people do it at all. So let's take this a little deeper.

    So what are these people like? Who opens more emails, ABC? Who responds more? Remember too that recurring buyers are where the real profits are to be made. Those are your A+ clients! You need to know a little about the kind of people who are A and A+ who they are, what they do and why they chose you. When you know that, and tie that into who you are and what you offer, your emails and advertising can be based on those people and those people alone.

    If you're with Infusionsoft you'll know Perry Marshall. This is his take on customer acquisition https://www.perrymarshall.com/25157/getting-new-customers/ (Mine is the first comment, by the way - if you didn't guess that just by reading it?) He says it better than I can in this small box.

    What about your C clients - using the above technique, that is to say characterizing your clients in a way that is descriptive ("they are homeowners, have two cars, three kids, like eating pizza at weekends" - total rubbish I just wrote off the top of my head, but nonetheless this is the sort of thing I want you to establish for your BEST clients). Because using these lead-ins shows your business in a different way, advertises and CONNECTS to them in a different way. What's more it's interesting for those who aren't your best buyers - only it's a real clincher to those who are! So what about your Cs? How many of them are A- and not C, how many C- and really not worth spending time on?

    That'll do for now. What's your take. It's always nice to see authors responding to questions. One last idea: a recession is a good time to spend time looking at the way your business deals with clients, it's like repairing the barn when it's winter! When sales start to pick up, you'll rocket because you have all the metrics and systems in place to maximize on all the stuff coming in.

    What's more, nobody else will have it. They'll be speaking to the dog walkers just like they always did.
  • Posted by Jon Hungerford on 4/16/2013 at 3:21 AM Author
    Moriarty, thanks.

    I'll take the time to respond to your post in detail tomorrow, but I'll just answer your question about phoning quickly.

    I've always been a tech person, and like you considered telemarketing to be a waste of our time and our customer's time. We traditionally relied on email, direct mail and our website/SEO/PPC strategy to drive leads to us.

    About 12 months ago we were in the middle of another slump in solar (the Australian solar industry has remarkably regular and consistent slumps and peaks). A business consultant we used urged us to get on the phones, start telemarketing. I was skeptical, but we did it anyway.

    Wow! I couldn't believe the response. Our sales just soared, and we started picking up customers from everywhere. We actually got a bit punch drunk and started calling everyone without properly qualifying who our ideal customers were, but that's another story (and the reason behind our customer ABC categorisation).

    It was just so easy to get someone over the line on the phone. We were seriously using our warehouse guys to make calls, people with no sales training at all. They were smashing it.

    We've since got a little more professional and got some proper training for anyone who's on the phone, and as I said started qualifying better, and up-selling and cross-selling more.

    Not dismissing the online strategy. It will be a complement to the calls, I think.

    I don't think telemarketing would work for everybody, but for us it was an absolute winner.

    More replies tomorrow.
  • Posted by Moriarty on 4/16/2013 at 3:40 AM Member
    Jon,
    great response - and I can tell you why your untrained warehouse guys were smashing it: you had honed your message online FIRST. That is always the bit most phone-callers miss out on, and is why I get so p*ssed with the Dutch guys who phone me telling me stupid things.

    The Perry Marshall link is the one you really want to look at carefully with your morning coffee. That has real and direct relevance to your problems.

    Goodness, what a breath of fresh air to speak to someone who's actually doing things right!

    The key here is the A+ and C- client characters. That way you can start using Google's display network - that would work an absolute treat for you guys. Especially with what you already know about your sales message and your client base.
  • Posted by Jay Hamilton-Roth on 4/16/2013 at 9:11 AM Member
    For your next contact with your "C" customers - ask them questions about their needs first (when, why, how much, etc.) and then follow up with them based on their preference. That'll change the conversation from a sales call to a consultation call, which is much more effective.
  • Posted by Peter (henna gaijin) on 4/16/2013 at 1:19 PM Accepted
    A periodic email newsletter could be good for retaining and getting more business from customers, but with some protections. A lot of this is repeat/summary from what was said in other posts, but here it is:
    - make sure people opt in and can easily opt out. Better yet is to make sure that if they opt out, they are opting out of just the newsletter (and not all emails). Give them the choice at opt out.
    - make sure the email has valuable content for the readers. Not just sales content (but that should be there), but maybe some hints or tricks or some information they would likely not know but benefit from.
    - think through who the email should target. You likely wouldn't want the same email for yours As versus your Bs and Cs. Maybe you don;t even send this to the As, but stick to what you have been doing. And maybe even Bs and Cs need separate emails, if they have separate needs.

    Note I said periodic - weekly may be too often. If this is a concern, maybe try for monthly first. Plus you may find that putting together the email content takes more time than expected (at least for a quality email), so weekly could be a challenge.

  • Posted by Jon Hungerford on 4/16/2013 at 9:09 PM Author
    Moriarty:

    Yes, Perry Marshall's ideas sound very much like the strategies of Marcus Sheridan from the Sales Lion. We're actually using his ideas in one of our other businesses, an online store. It will be good to see another person's take on this stuff.

    Jay, Peter and Kathleen, thanks for your responses. All helping me to formulate this strategy.

    I'm thinking what I need to do first is revisit and refresh our online strategy for this business, before we start the emails. It had taken a bit of a backseat for the last 12 months...
  • Posted by Moriarty on 4/17/2013 at 3:39 AM Member
    Hi Jon

    I think you'll find that Perry's strategies go really deep. His right-angle marketing is verging on some of the ideas I have - and the reason I posted that link to his blog was about the increasing expense of getting new leads in a market that you have saturated. I don't see much of that on Marcus Sheridan's site (but then, I have only just found it! ). My point is that if he isn't able to deal with markets that are tired out, you need a TOTALLY different focus. Not strategy necessarily but the focus of your ads. Pull different emotional strings and target a totally different sector of the marketplace.

    Can you share a landing page with us and we can scorch it!

    Are you the guys in Queensland?

    Moriarty.



  • Posted by Jon Hungerford on 4/23/2013 at 8:05 PM Author
    Moriarty:

    Sorry for the delayed reply, been off work sick.

    Yes, we are from Qld.

    Just going through Perry's site now. Some really eye-opening, refreshing stuff.

    I will revisit this post later once I've caught up a bit.
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