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Marketing metrics on a shoestring

By Nancy Ulrich   

The task before you looms like that big dark cloud on a hot summer day: You need informationShoestring Budget but have no idea how to get it.

You may be thinking about measuring customer satisfaction or launching a new product or service. Perhaps you are contemplating expanding your business or buying a new one. Or, maybe you are wondering why your customers are not knocking down the door while your competition is going gangbusters.

No matter what the need, it all boils down to doing research that is smart, solid, and reliable. And it must be affordable as well.

Research can provide certain metrics that allow you to track the course of your business. As we are often reminded in the world of business, “you cannot manage what you do not measure.” This counsel applies to everything about your business, and it definitely applies to the research process. Just make sure you are measuring those factors that influence your business, and that you are measuring those factors you can influence.

A 12-step start

Start with a few basic tasks you can easily accomplish on your own or assign to a responsible employee. It is the simple task of converting observations into something you can measure.

1. Ask yourself two basic questions: What do you need to measure so you can manage it? How will you apply this to growing, sustaining, or starting a business?

2. Create a database of your customers or clients. A simple Excel spreadsheet will work well since you can continue to add fields when necessary. Whether you have a professional service or a retail establishment, this database is created to reflect your business model. Gather pertinent information (in separate fields) about your customers such as name, address including zip code and contact information including home phone, cell phone, and e-mail address. In retail, ask your customers to complete a short contact card as a great way to start building repeat business.

3. Collect zip codes. Getting a zip code from every customer and potential customer lets you determine the market areas from which you are pulling traffic. This information is helpful in directing your advertising and marketing activities.

4. Plot customers on a map. Use technology to your advantage if you have a geographic trade area. With an address, you can plot their home on Google maps. This type of free information will assist in purchasing advertising, locating a new store, building information on your competition, or conducting due diligence when purchasing a business, or increasing the value of your business when you sell.

5. Record demographic characteristics. Include gender, age bracket, marital status, or if the customer has children.

6. Record lifestyle characteristics when available. What kind of vehicle do they drive? Does the car bear any membership stickers for clubs, churches, or schools? Do any of these exterior signs indicate an affluent market or customers who may be struggling? Does your observation suggest success or failure for your company? What if they are your competitor’s customers?

7. Track traffic flow. How many people call or come into your business by the hour, day, or week? How many in the party? Of those who purchase, do they buy on impulse? How many walk away without buying? How do these customers differ from those who purchase? Once you establish the standard traffic flow, experiment with various techniques to see if you can vary the pattern in a way that increases your cash flow without impacting your overhead.

8. Ask how your customers heard about your business. Why did they select your business when they could have gone elsewhere? How did they find you? Did they mention where else they shopped? (Ask them about that experience.)

9. Make your advertising measurable. Did you include a coupon in the print ad? Did you tell customers to ask for Joe or mention a code word in the radio or TV commercials? Are you monitoring and measuring hits and click-throughs on your microsites or Web sites? Without monitoring the effectiveness of your advertising, how will you ever know if or what part of your advertising is effective?

10. Watch weather conditions. If weather can affect your business, keep a log of daily weather conditions and see if you notice any trends. If rain or cold keeps traffic away, create a draw to reward your customers. If inclement weather has the opposite effect, then be prepared for the deluge that is coming to your store. (Suggestion: Consider using Twitter to send “rain special” announcements, effective only for the period of a downpour!)

11. Record the sales. How much money did your customers spend? What were the high and low sales of the day? What was the average sale? What is the potential for add-ons? Is this a one-time sale or opportunity for repeat sales?

12. Mystery shop. Do this to your competition or the business you want to purchase. A wise man once said the only business you need to know more about than your own is that of your competition. Mystery shop by phone and in person when feasible. How many cars are in the parking lot at different times of the day compared to your place of business? What kinds of cars are their customers driving? Are the grounds well-maintained, indicating a thriving establishment? What are the signs of activity? What types of delivery trucks do you see coming and going? (While you are at it, mystery shop your own business.)

Remember, no one knows your business better than you do, so ask the tough questions and find a creative way to gather the information. Once you start to quantify these answers, you will soon discover how to apply data in a meaningful way—to help you build the business, avoid costly mistakes, modify your business plan, outpace competition, and deliver value-added services and products to existing and new markets. These observational factors are especially important if you are considering the purchase of an existing business.

Nancy Ulrich

Nancy Ulrich

Nancy Ulrich is president of Ulrich Research Service, Inc. (www.ulrichresearch.com), 1329 Kingsley Ave., Suite A, Orange Park, Fla. Contact her at 904-264-3282 or nancy@ulrichresearch.com.

 

 

SIDEBAR

Basic steps to design your research project

Regardless of the purpose for your research, the basic steps apply in most situations.

  1. Establish your goals and objectives. Ask yourself or your team what you hope to accomplish with the research. How will we apply the findings? Are they realistic? Are they strategic or tactical?
  2. Refine your goals and objectives. You should have one primary goal, maybe one secondary goal, and no more than a few key objectives.
  3. Select your target audience. This can get tricky, especially when it comes to exploring new opportunities or existing challenges. However, if you do Step 2 correctly, the target audience will reveal itself.
  4. Match your methodology to your target audience. Know what type of survey you want to conduct and which methodology will work best for the target audience. Basic formats of quantitative research include conducting surveys by telephone, direct mail, in-store comment cards, online, and intercept (great way to increase the value of cashiers, wait-staff, sales reps, delivery personnel, and receptionists).
  5. Design the survey.  Stay focused on your goals.
  6. Pick the best methodology to address your goals and objectives. If you are going to conduct your own research, make sure you feel comfortable using the tools that are available. Survey Monkey (www.surveymonkey.com) has brought the art and science of marketing research onto the desktop of most business owners. If you are conducting a phone or direct mail survey and lack analytical skills, simply set up Survey Monkey and input the data into this system. It will calculate the responses and provide you the basic metrics.
  7. Allow enough time to gather and analyze information. Time your survey so that it is relevant and meaningful.
  8. Analyze the data. Sit down with your team and take an objective look at the data. Remember the goal is to gather data that influences your business over which you can exert some control and influence. Expect some fluctuation in the data. And most important, do not stop collecting data because you do not like the results, feel that you are not learning anything new, or suspect that you already know all the answers.
  9. Apply the learnings. Based on the metrics that are most useful, continue monitoring your progress. Readjust goals as necessary based on facts, not emotion. Share the information with your staff and engage their assistance and enthusiasm.

Some cautions

Do not do research unless you are willing to implement offered recommendations or make significant changes when indicated. In other words, if you don’t want the answer, don’t ask the question.

And don’t expect to get all the information you want with one survey. The length of the survey depends on the mode of data collection: Keep a direct mail survey to one page, front and back. Telephone surveys should be under 10 minutes to avoid respondent fatigue. You may be able to risk have longer online surveys, however, especially if respondents can stop and start again. As tempting as it may be, don’t use a survey to sell or solicit business.

 


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