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Profits are the Holy Grail of Marketing
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Good marketing means moving merchandise. But is that enough? No. Not if all the merchandise you are moving does not result in a profit.
Anyone can lower prices to the point where people will buy like crazy. But if you get no money for your soaring sales, what's the point?
It's easy to get lost in the game of marketing. For example, when a business hires an ad agency, they hope they produce ads that are spectacularly creative, funny, inspiring and more.
The problem is, creativity and inspiration do not automatically translate into profits.
A good example: McDonald's a couple of years ago featured a TV commercial with basketball gods Michael Jordan and Larry Bird having a wild free throw contest.
The public ate it up. The problem: they ate up the commercial but not the burgers!
You see, the ad did nothing to sell hamburgers for Mac. When analysts surveyed people who had seen the commercial, all of them could describe who was in the spot and the premis -- but only a tiny percentage could recall what was being advertised, and by whom!
The lesson? It's what I call Varga Rule No. 19: "All marketing has one purpose: to produce profits." If an ad is funny and creative but does not make sales, it's bad advertising. Ads are not the only aspect of marketing where profit is forgotten.
Some marketing can speed up traffic, but result in no profits. Some marketing can create more sales at the expense of profits. Some marketing can speed up turnover as the expense of profits.
When you get the idea into your head that marketing MUST equal profits, you are starting off right.
The key is to look closely at your total cost for sales and your profit on each sale. Lowering your cost per each sale is the first part ... and increasing the profit for each sale in the completion of the process.
Luckily for you, Gentle Reader, I am going to give you my seven best tips for making sure your marketing means profits, and nothing else.
1. Unless you're a giant like Microsoft, Best Buy or Ford, you can't afford institutional ads. That's the kind of advertising that produces expensive white elephants like the McDonald's boondoggle I described above.
Instead, put your money in direct response marketing. Here's a fact: Direct response marketing outsells institutional marketing 300 to 1.
2. You must put the customer completely at ease and remove all their fears of buying from you. How? There are a number of ways, but first among them is to indemnify them from risk. A 100 percent money-back guarantee does that.
3. Test, test, test! Every single marketing tool you pick up must be tested with great accuracy. If you paid $900 for an ad, how much profit can be directly attributed to that ad? If you mailed out 5,000 sales letters, what's the profit after all is said and done?
Notice I did not ask "how many sales" the ad made? It's not sales, it's profits!!
4. A headline in 90 percent of your ad. The best ad copy in the world is useless if it never gets read! Your headline is the "ad for your ad." Put the majority of your sweat into a headline that really grabs, or the rest of your effort is lost.
5. Remove all resistence/confusion to buying. Do every thing in your power to make buying easy. Have an 800 number. Let them pay with credit card. Make the ordering form extremely easy complete. Killing resistence means profits.
6. Find and set the right price. Is it better to sell a lot of products cheap, or a few products at a premium price? It depends on what your selling! You have to figure that out for yourself and for your product. Find the right price and you will find profits.
7. Don't just tell people why they should buy from you -- show them! Show them how better off they will be after they have your item. You do that with benefits. Apply those benefits to the life of your customer.
There are more, but if you take these seven tips tp heart, you'll being producing profits with your marketing -- and that's what marketing is all about.
Ken Varga is the author of "How to Get Customers to Call, Buy and Beg for More." For More information you can communicate with Ken by FAX 732-364-3716.
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