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The price of everything has gone up. And, I’m sorry to say, value hasn’t been keeping up. Consumer habits have changed and customers aren’t buying like they used to.
Meanwhile, behind the curtain, marketers are tweaking webinars, emails, landing pages, and ads. At the same time the total price (value) of all of these tactics has also gone up. and the ROI has been dropping.
So many folks in my community are saying things like “Nothing is working like it used to”, and I have to agree.
And, what I realized is that we haven’t done enough deep thinking on what’s going on. So, instead of solving for symptoms let’s start solving for the problem.
What Does “Not Working Like it Used To” Really Mean?
This is a loaded question. “Not working” generally means that registrations are down, attendance is down, engagement is down, conversions are down, prospects are saying that they just don’t have the money.
These are all valid reasons, but what’s underneath those?
But, if customers simply no longer have enough money to buy what you’re selling – price is a factor.
Typically, we marketers don’t like to acknowledge that price is a factor in purchasing decisions. I like to say that if your customers are complaining about price, they have no idea why they should choose you.
But, if customers simply no longer have enough money to buy what you’re selling – price is a factor. That means that your product or service is the low man on the totem pole, and it’s just a matter of time before they stop buying.
And if you are experiencing this, the price elasticity of what you’re selling is higher than you thought or than it used to be.
When Customers aren’t Buying Because of Price, You Need to Pay Attention
Price elasticity is more of a thing than you realize.
You don’t hear a lot of people talking about price elasticity, but understanding this economic concept is more important than you can imagine. Here’s a quick primer.
Price elasticity of demand: This is a measurement of the change in consumption of a product in relation to a change in its price.
Low price elasticity: Demand stays the same no matter how high or low the price goes.
High price elasticity: Demand varies depending on the price.
Of course, as entrepreneurs and marketers, our goal is to have an in-elastic price (low price elasticity). That means that no matter what the price, people will buy our product because demand doesn’t change no matter what the price does.
Necessary Goods are Less Elastic
Another example of relatively inelastic goods are “necessities”; bread, milk, eggs, and the internet are good examples. These are goods most of us need to “survive” in today’s market. If some of these brands get too expensive, people might shift brands, but it will take a lot for consumers to not purchase them as a category.
Necessary Brand is the Goal
If your product or service has a solid brand reputation and is considered to be a necessary good by your customers, you should not see much of a shift in demand or sales.
But, if your product or service is perceived as a luxury or preference and the price gets too high for your customer, you’re going to have a problem.
If Your Sales and Profits are Down – What You’re Selling Isn’t Considered a Necessity
And there we have it. If people aren’t choosing and buying your product or service, they think they can live without it OR they think that something cheaper, ahemmmm more affordable will be good enough.
And this, right here is where some competitive analysis can come in handy.
How to Do Some Quick Competitive Analysis
- List out the alternatives that your prospects can choose to solve their problem or achieve their desired outcome. I’m not just talking about other companies or products, I’m talking about alternatives; can they do it themselves, can they buy a book, watch a YouTube video, what are the alternatives – all the alternatives. Create a complete list.
- Make a list of “features” or “jobs to be done” that your customer is looking to get done with your product or service.
- Match the features of your product or service to the desired outcome your customers wants. Be brutally honest here, because this is where you’re going to find your opportunity.
- Don’t forget the critical components of what your customer really wants; fool-proof, immediate, easy. What are the ways in which you’re going to make sure that your offer is fool-proof, the results are immediate, easy, and virtually guaranteed.
- What alternatives actually provide results that are fool-proof, immediate, easy, and guaranteed? How much are those?
- Now you have a good comparison table that your prospects will want to see and evaluate so that they can make their choice.
Your Customers Are Strapped and Pissed – And it’s not your fault
Great, now let’s get out of your world and into the marketplace for your products and services. I don’t care what industry you’re in, it’s flooded with options and great marketers who have been turning up the volume on why their offers are NECESSARY.
While this has been working for some, it’s NOT working for most small businesses.
Consumers are financially stressed.
You see, what’s happening right now, is that so many inelastic and necessary goods and services have gone up, up, up while earnings have been relatively stagnant (unless you’re a big corporation), that there’s literally not enough money to purchase those secondary goods and services that your customers WANT or even NEED (just not to survive).
Not only that, but while big corporations have been stacking their earnings (to CYA in case there’s another disruption) we entrepreneurs and small business owners have been empathizing with fellow consumers and trying to keep our prices as low as possible.
How to Make Your Marketing Work – Again
The answer isn’t fast or easy – it’s not tactical. In other words, improving your email subject lines, or just doing a training webinar. The answer isn’t really even strategic in nature; deciding to do ads or creating more video content.
Shift Away from Promises and Focus on the Proof
I’m going out on a limb and saying that we need to shift our marketing over to delivering on reliability, quality, and being on the customer’s side – I’m thinking about the brand promises of the past – the brands you can count on no matter what; L.L. Bean, Lands End, Southwest – remember those brands that stood behind their products, that stood by the customer? We’re not seeing so much of that anymore.
I think we’ve gotten lazy and because digital marketing is so affordable, we’ve been focusing on tweaking the copy and the layouts and messing around with everything but the quality of the customer experience.
Let me show you what I mean. Here is a landing page I clicked on from a Facebook ad. It’s a great headline, it’s a neat offer.
But – if I only have a fixed amount of money to invest in my marketing – I’m thinking that my best investment is going to be in doing the best I can and not giving anyone else money.
In this next Facebook Ad, there’s an over-the-top promise and free download. But while I definitely want to download, there’s no way I’m going to give anyone thousands of dollars I don’t have for a promise that isn’t guaranteed.
Focus on Necessity
Consumers are focusing on the necessities in their life. And if you’re selling to solopreneurs, and small business owners, think of them as super-consumers. And that means their spending has been severely limited.
Your job is going to be to identify the necessity that lies behind their need for their product. Don’t make anything up. Instead, think about your customers deepest desired outcome; don’t just default to security, what’s underneath their desire for security as it relates to your product? To what degree is your product easy, fool-proof, guaranteed to deliver on the specific aspect of security that they’re after.
So, let’s say that you provide sales training. And if your clients are looking for security, what are all the different ways that you are delivering on their desire for security.
How is it fool-proof?
- Getting regular support, coaching, training from someone who has consistently delivered results will eliminate mistakes, errors, missteps
How is it easy?
- It might be uncomfortable, but it is easy. You just have to do what they tell you when they tell you and how they tell you to do it.
How are my results guaranteed
- If you persist, you will get the results. Everyone who has completed the program and followed the instructions, got the results.
This is just the process you need to go through as thoroughly as possible.
Prove the ROI
This is where your previous customer experiences will make all the difference in the world. Are customers recommending you? Are you getting referrals/
If you don’t have success stories, you need to do whatever it takes to create those. This might mean volunteering or pro-bono services, or it might mean providing deep discounts. But the outcome will be worth it.
Another benefit is that you’re going to be gaining valuable feedback so that you can do what it takes to improve your offer.
Provide More Value
Value comes in a variety of shapes and sizes depending on each customer. Your number one job is to figure out how each of your clients defines value. It might be in the form of having your time and attention. For another, it might be immediate delivery. FIgure this out because it makes all the difference.
Guarantee Results
When it comes to coming up with an outrageous guarantee, most people just default to eliminating risk, buyer’s remorse, or fear of taking action. Yes, that’s what a guarantee does. But it’s so much more than that.
To come up with an awesome guarantee that achieves all those things, you have to know how your customer breathes, what’s been their experience, what’s underneath their most common objections, and what can you do to help them get to their desired result (and not just buy now).
The easiest thing you can do is provide an unlimited guarantee – your money back no matter what, no matter when. This isn’t the right answer for everyone. And it’s definitely not the answer if you don’t have a solid history of performance.
You can provide a guarantee that allows clients to go beyond the contracted term until they get the agreed upon results.
Don’t just pick something. Talk to existing clients, talk to prospects, and make sure that you have a deep understanding of all the elements that can get in the way of your clients achieving their desired results.
Focus on Loyalty and Delivering on the Promise
If you want to work less and make more, then your ideal strategy is to focus on building a cadre of loyal, happy, and profitable customers. Granted, this isn’t for everyone. But if you’re the type of person who would rather be working, doing what you do well and helping people, I advocate for a smaller, more exclusive, more loyal, more highly served customer base.
While everyone is focused on gathering up as many new customers as possible, you’re focused on identifying just the right customer and serving them out the wazoo. There are so many benefits to this strategy; you’ll create offers based on what your existing customers will want to buy, you’ll reduce your marketing expenses, you’ll be so good at what you do that people will be willing to pay more.
Do You Want to Do Less for More?
It seems odd for a marketing person, but I am all about the idea of un-marketing; doing less marketing to make more money. The idea is to focus your energies on a small set of clients who love working with you and appreciate who you are and what you do.
Instead of trying to convince every customer who should be buying from you, shift your focus to meaningful interactions. Understand that your customers aren’t just looking for the best deal; they’re looking for a business they can trust, a brand that understands them and is there for them, rain or shine. Be that business, and you’ll find that doing less can indeed lead to more: more loyalty, more referrals, and more success.
So, ask yourself: Are you ready to un-market and create a community of loyal customers who believe not just in what you sell, but in who you are? If the answer is yes, then welcome to the new era of marketing, where less is more, and where your customers are your greatest asset. Welcome to the future.