Generating Cash Flow for Marketing in Lean Times….and Using It

WiselyCoach Thom Finn

Coach Thom Finn: Owner/Partner Harrisburg/Lancaster Coach Thom Finn: Owner/Partner Harrisburg/Lancaster OfficeOffice

Named “Global Coach of the Year/Client Results” in Sydney for Named “Global Coach of the Year/Client Results” in Sydney for 2009. Coach of the Year/Client Results for 2009. Coach of the Year/Client Results for all of North & South all of North & South America America 2009 & 2008, finalist Global Coach of the Year in 2007. 2009 & 2008, finalist Global Coach of the Year in 2007. Average increase in client net income increase :31%Average increase in client net income increase :31%

Strong back ground in revenue creation/marketing & sales Strong back ground in revenue creation/marketing & sales strategies, sales person coaching, certified copywriter, resident strategies, sales person coaching, certified copywriter, resident expert on web-based copyexpert on web-based copy

Practitioner of Theory of Constraints Consulting in organizations Practitioner of Theory of Constraints Consulting in organizations with faster results to profitability than standard approacheswith faster results to profitability than standard approaches

Specializing in leadership/management coaching with those who Specializing in leadership/management coaching with those who have focus/ADD ADHD challengeshave focus/ADD ADHD challenges

In addition to a full-time Coaching schedule ThomIn addition to a full-time Coaching schedule Thomalso owns and runs a turn-key business thatalso owns and runs a turn-key business thatgenerates overgenerates over $2 Million/year and 28% net profit$2 Million/year and 28% net profitwith virtually no investment of time.with virtually no investment of time.

Learnings….

Blinding Flashes of the Obvious

BFO’s

Write Them Down

A Poorly Written Note is Better Than..

A Great Thought Forgotten

And your Commitments to Do

BFO’s To Do’s

To Make Sure You Get the Most Out of Your Learning ...

I KNOW

7.5 Tools to Get the Most Out of Your Marketing Dollars…

1. Know “Your” Math

2. Ideal Customers - Get Your Target Right

3. “Differentiation/USP”

4. “Test & Measure”

5. “10 by 10”

6. “5-Ways”

7. Marketing Campaign “Break-Even”

8. Writing Ads that Work

7.5.

KNOW your Math….The “Math” of Discounting and of Price Increases....

40% gross margin10% price change = 25% profit changeWith a 10% Discount, what increase in customers do you need to break even?

60 60 60

4030

50

0

20

40

60

80

100

120

Base 10% Discount 10% Increase

Profit

Variable/Direct Costs

33%

1

Know Your Price Increase Math…

MarginPrice

IncreaseProfit

Increase

Decrease in

Customers to Break

Even

20% 10% 50% 33%

40% 10% 25% 20%

40% 20% 50% 33%

60% 10% 17% 14%

80% 10% 13% 11%

1

2

Here’s your target!

Differentiation…UniqueSelling Position

3

*List 10 Ways Your Business is Unique

Friendly staff

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If your competitors can say it, then it's not unique!

Shop is clean and tidyWe have a 24 hour money-back guaranteeStock in a range of sizesWe have a unique 8-step fitting program toensure that our staff fit you correctlyAll of our staff attend an intensive 2 day color co-ordination training programWe are well establishedWe care about youWe have a pick-up and delivery alterationservice to and from your homeWe have 28 different brands of coffee and tea just so you and your friend can enjoy your time with us

1.2.3.4.5.

6.

7.8.9.

10.

With Proper Differentiation….

Four Steps to Make Your Business Stand Out

1. Survey your best & most loyal customersa) Know what makes you valued from their point of view

b) What separates you from competition in their eyes

c) Is this what you thought made you different?

2. Narrow their insights into a 1 -2 sentence value statement

3. Use that statement to drive all communications

4. Test to stay on-track and at the top

Family Owned, Honest, Friendly, XX Years in Bus.

My USP

Free- No Strings- Restraining Order Ready- Coaching Session

Coaching Programs from $280 to $1700 a month

Every Session Guaranteed or $ Back

Cancel at any time

So, why do you track your checkbook better than your key business metrics?

4

4…..HOW to Test and Measure

How Did You Hear About Us

Point of Sales

ACT!, Salesforce, CRM

Interview customers

Track in excel

Peak time periods only

The Rule of “10 by 10” ...5

Who wants more…..

Number of Leadsx

Conversion Rate=

Customersx

# of Transactionsx

Avg. $$$ Sale=

RevenueX

Margin =

$ Profit $

6

With just a 10% increase...Number of Leads

XConversion Rate

=Customers

XNo of Transactions

XAvg. $$$ Sale

=Revenue

XProfit Margins

=$ Profits $

4,000 X25% =1,000 X 2 X $100 =$200,000 X 25% =$50,000

4,400 X27.5% =1,210 X 2.2 X $110 =$292,820 X 27.5% =$80,525

A 10% increase in each of the 5 areas will result in a 61% increase in Profits?

Do it 2 years in a row and your profits will increase by 159% compared to baseline?

Number of Leadsx

Conversion Rate=

Customersx

# of Transactionsx

Avg. $$$ Sale=

Revenuex

Profit Margins =

$ Profits $

Did You Know That...

Number of Leadsx

Conversion Rate=

Customersx

# of Transactionsx

Avg. $$$ Sale=

Revenuex

Profit Margins =

$ Profits $

How We Will Apply the Rule of “10 by 10” to Grow Your Business...

Work on 5 LG Strategies

Work on 5 CR Strategies

Work on 5 #T Strategies

Work on 5 Avg. $$ Sale Strategies

Work on 5 PM Strategies

Marketing Campaign Break-Even Analysis

Total Cost $ ______divided by

Average Profit ($) per Customer $ ______equals

Number of Customers Required ______divided by

Measured Conversion Rate ______equals

Number of Leads Required ______

What is the probability that the campaign will generate the required number of Leads?

7

Test AdvertisementTest Advertisement AA BB

Advertisement CostAdvertisement Cost $1,000$1,000 $1,000$1,000

No. Of LeadsNo. Of Leads 1,0001,000 100100

Conversion/SalesConversion/Sales 100100 5050

Ave $$$ SaleAve $$$ Sale $500$500 $1,000$1,000

Ave $$$ ProfitAve $$$ Profit $200$200 $200$200

Lifetime ValueLifetime Value $5,000$5,000 $10,000$10,000

ReferralsReferrals 1010 22

Calculate Your Campaign Break-Even Point

$2500 Direct Mail Campaign

Start with 5-Ways Data Average $ Sale

Average Profit

Conversion Rate

Use prior Test & Measure Data Response rate from targeted DM = 1.5%

Calculate Your Campaign Break-Even PointCost = $2500

Avg. $ Profit = $25

# Customers Req’d = Cost/Avg. Profit Per Customer

= $2500/$25 = 100

Conversion Rate 20% (Measured – not guessed)

# Leads Req’d = # Customers Req’d./Conv. Rate

= 100/0.20 = 500

# Leads Expected = # Pcs. X Response Rate

= 10,000 x .015 = 150

1. Using your company name as the headline…

2. Not using the word “You” or some connotation in the headline…

3. Not opening a “loop”… Where the prospect has to continue reading to get the answer…

4. Not having a clear “Call To Action”…

5. Trying to do/say too much…

Writing Ads that Work… 7.5

The Headline is the ad for your ad…

Does it select the right readership?

Does it invoke curiosity? A promise of meaningful benefit?

Will it stop the target market in their tracks?

20 - 25% of the size of the ad

Writing Ads that Work ….

Headline

Target(s)Call to Action

Testimonial

Benefits

Offer

Loop ..”Who do they want???”

“You”

Seen this lately?

“Family Owned & Operated”

28 Years in Business

“Friendly” or “Professional”

Fully Insured

Caring, Trained Staff

On-Time Service

Benefits

USP

Call to ActionScarcity

Applied to Websites: Before

Applied to Websites: After

Putting the Puzzle Together

“USP”“Test &

Measure”“10 by 10”

“5-Ways”

“Ads that

Work”

“B-E Analysis”

“Ideal

Target”

“I look around for 1-foot bars that I can step over.”~Warren Buffet

“I don't look to jump over 7-foot bars:

From Your BFO Sheet….

And your Commitments to Do

BFO’s To Do’s

Do you REALLY want to get this stuff done?

No….I just wrote stuff to get you off my back

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What would it be like if youEXECUTED what you wrote down….

Yes…but it’s really not that importantYes! I do…I really do…

Take the information on Group Coaching

This Presentation avialable…take a blue sheet

Marketing is… ______.