Of course nobody believes this anymore. There are countless examples of inferior products outselling far superior ones.

Just think of video recorders – do you remember Betamax? I’m writing this using Microsoft Word - what happened to Word Perfect? And how come your competitors are doing so well with their products?

Marketing your product or service successfully is essential to increasing your sales. And providing a service to your customers that is truly amazing is the key to profitable growth.

Before I answer your question let’s address the wider issue …If you’re just starting up you need to invest wisely in technology. Just get what you need & start with a PC, printer & a database. Used effectively it’ll be like an extra person – and cost a lot less too!

If you’ve been in business a while you’ll understand that keeping costs under control is vital. It’s absolutely essential to be efficient in every aspect of your admin - And in the marketing of your products & services too.

Can you track your leads and follow them up as you should? Or are you losing sales because it’s just too difficult?

Can you process orders, raise invoices & fulfilment documentation quickly? Or are you simply bogged down doing everything manually?

There is a better way – it’s using a database designed for direct response marketing.

Even if you’re simply using Mail Merge for regular customer communication you need to track everything you do. It’s the same too if you’re using it for Customer Service.

And the best database for tracking Email, Letters, Faxes … is a Direct Response Marketing Database.

So read on. You’ll find lots relevant to you.

It eats up your time, reduces your effectiveness and costs you money. So use a database to hold all your customer and prospect information.

Make sure that everything you need to know about a client or prospect is in your database. Including …

Contact details

Client Profile

Correspondence

Details of Purchases, Offers & Enquiries

And as you get used to using it you’ll realise it can do much, much more for you.

Above all it will free up your time so you can spend more of it – working on your business and not in it.

Unless you have an unlimited budget - and I assume you don’t you’ll need to get maximum return on every £ you spend on marketing. This is true whether you’re just starting up or an established business.

So don’t waste your money on trying to establish your brand name through institutional style adverts.

It would take you a long time and a great deal of money and during this time you wouldn’t know whether it was working or not. And you need to know how effective each advert or mailer is - Because otherwise you could be wasting your money and a major opportunity.

If you’ve no way of knowing how much business a particular advert or mailer is bringing in then find out or if you can’t - stop doing it. Otherwise it’s like pouring your money into a black hole in space where everything goes in but nothing ever comes out!

Knowing if a mailer, advert … is working for you mean you can continue with those that are and stop doing those things that aren’t.

If you get more enquiries & sales from an advert in one publication than another then you know what to do.

Marketing "Smart" is the path to increasing your profits substantially. And to do this you need to track every marketing activity.

How do you do this?

An easy and very effective way is to allocate a unique code to each advert and mailer. For instance, a code like "WR5073" could indicate … Widget News -Your product name beginning with "R" – and the third advert in July 2005.

You can use any code structure you like so long as you’re consistent. Design the code to suit your business to give you the information you need.

Because then you can analyse your results and get answers to your questions such as …

What’s the profit/loss on this advert?

What’s the cost of acquiring each new customer?

What price should I charge to give me the best return?

Which months give me my best return?

You do the same thing with your mailers too. Typically including a coded Order Form and if the prospect chooses to call you ask her to quote the code to benefit from your special offer.

You may think this might put people off – on the contrary. Asking for a code to benefit from your restricted offer makes the caller feel special – like being a member of a select club.

But let’s start at the beginning …

First you need to get people interested.

If you decide to place an advert all you can do is to wait for responses. Then whatever the outcome from the initial enquiry you need to enter as much detail as you can garner into your database. Then you can follow up in a structured multi-step way.

If a prospect does not buy your product initially then keep at it. It’s worth contacting up to eight times or more over a period of several months before finally throwing in the towel.

It’s not unusual for a prospect to take a lot of convincing but then end up by being one of your best customers.

And record everything you do using your database. So it’s easy to do a follow up letter, email, fax or telephone call.

You may have bought or rented a list of businesses whose profile makes them most likely to respond to your offer. At this stage they’re not prospects so don’t store their details in your customer/prospect database. Keep them separate.

Immediately you get a response no matter how tenuous set them up in your customer/prospect database. You can now contact them using a multi-step sequence until you get a result or decide they’re just not really interested.

Track every contact and set automatic reminders for say a week or so later so you don’t forget to follow up your mailer, email, telephone call…

Using the power of your database in this way means you stay proactive all the time – not just in bursts when you remember to be.

This is easy for your first few adverts/mailers but as you do more & more you’ll need something other than paper and pencil to get the information you need. This is where a Database Designed for Direct Response Marketing comes in.

As you get an enquiry or make a sale enter the information into your database immediately. This needs to include …

•  Contact Name

• Business Name & Address including post code or Home Address

• Telephone & Fax number

• Email address with their permission to contact in this way

• Enquiry/Sale Details, such as …

• Enquiry method – by email, fax, mail …

• Advert/mailer code – your secret code

• Date Purchased/Enquired and if purchased …

• Purchase Price & quantity

• Cost of goods – your hard cost excluding overheads

• Gross Margin – calculated from above

If you can get more information such as the type of business, their size, additional contact names … so much the better. If not try & get it later so you can use the customer’s profile in a targeted mailer.

Now that you’ve captured the customer details you can analyse your results without effort. And get answers to the questions posed above and many more. So you can continue to do and even improve on what works and stop doing what doesn’t.

If you offer a Money Back Guarantee - and you should – you will get some returns. So you’ll need to cater for this in your database design so you can analyse returns by marketing reference.

A higher than usual number of returns, (as a rough guide - over 10%), may reveal that your advert/mailer promises more than your product delivers. If so you can look to improve your fulfilment package.

You’ll need to include a check on returns when you mail your customers with a new offer. Rather than ignore them they need to be treated differently.

For instance you may have an updated version of your product that you want to reveal to previous purchasers for whom the old product did not suit.

Alternatively – you may decide not to contact these customers again but retain the information in your database for your marketing analysis. If so you’ll need a "do not contact" field in your database. And make sure you test for this whenever you do an extract for your mail merge.

And if someone asks to be removed from your mailing list it’s essential that you do so. Otherwise you risk causing offence and that’s not good for your image. And you’re also wasting money on postage & stationery.

This is particularly important with Email – otherwise you risk being treated as Spam. So never Email anyone without their permission unless of course they’re responding to an enquiry. Then you can offer them the opportunity to receive more information from you by Email and build up your list that way.

Marketing by Email to your list is the most economical method possible. However it’s not necessarily the most productive.

Testing has established that "snail mail" produces a greater response. But of course it costs more.

Even if a mailer is working well for you - possibly the results are amazing - don’t assume that this is the best you can do. Continue with it of course – it’s your "control" and at the same time try varying one thing.

Start with the headline - apart from the list itself it’s the singular most important element in your mailer or advert. Then - try your special offer, bonus, price … Then mail both mailers simultaneously to different prospects from your mailing list.

By tracking every response using the two marketing codes you can analyse the results with your database software.

You may be surprised by what you find – a seemingly whacky idea or just a small change may outsell your control piece. Even dramatically so.

Remember – when you test one mailer against another only vary one thing at a time. Change the price or the headline … but only one item otherwise the test is meaningless.

Testing should be continuous. Even your best advert will eventually tail off. Don’t wait until it does because then you’ll suffer a decline in sales whilst you’re testing a new advert or mailer. And this may take some time.

What’s The Best Price For Your Product?

Using your database it’s easy to perform a price comparison analysis. You may find that a higher priced product or service outsells the same item at a lower price. Even if it doesn’t your database will tell you which price gave you the highest profit.

Consider …

Mailer 1 results in 10 sales at £99 each of product x giving a gross margin of £700

Mailer 2 results in 12 sales at £149 each of product x giving a gross margin of £1,788

Mailer 3 results in 9 sales at £219 each of product x giving a gross margin of £1,971

These figures are of course fictitious. But they’re not untypical. The reader’s view of your product may be coloured by the price you’re charging.

He may measure your product’s quality by the price you charge. And the £99 price may give the impression your product is cheap rather than inexpensive. It’s a reason why if you offer a bronze, silver & gold service most customers choose "silver".

Only by testing can you determine the best mailer or advert. After all it doesn’t matter what you think, or your colleague or partner thinks. Only the reader’s view matters. She decides whether to buy your product or not.

So at first glance Mailer 3 looks the best option to go with as it gives you the highest gross margin. If you’re after a one off sale of a high priced item then it probably is.

If though you offer a range of products & services your back end sales are more important to you. So Mailer 2 could be the best as it brings you more customers.

It all depends upon the Average Life Time Value of your customers.

Your back end sales are typically of two types …

You have a range of products/services that you can offer to a new customer at the point of sale and by subsequent mailers.

Your product is a consumable and you encourage your customers to repeat order. Possibly by enrolling each new customer in a preferred customer club that offers discounts on future purchases.

If you don’t currently have a back end offer of either type then create one. This alone will boost your profits immensely!

Your database can tell you your ALTV in an instant – provided you’ve entered the details of each sale for every single one of your customers.

Breaking even or worse on an advert or mailer can easily prove to be a real success through your back end offers.

Don’t make the mistake though of confusing apples & pears. If your business has two or more distinct product or customer categories then treat each one separately when calculating your ALTV.

It may take you a few months or even a full twelve months before you have sufficient buying history to give you an accurate figure. But every month gives you more information to analyse.

So are you starting to see how using a direct response marketing database can boost your profits? Good we’ll move on.

Let’s assume you’ve now got an established customer base complete with buying history in your database - And have a new product to offer.

Targeted Mailers – Increase Profitability

Imagine the effect on your profitability if you could extract a list of customers likely to be interested in a new product or service and do a mail merge immediately. Then track the responses to your mailer customer by customer.

And be selective in your follow up mailer – using the saved list – and track the response to that too.

It’s easy with a marketing database. You simply select a list of customers who previously purchased a related product or service or customers of a specified industry or geographical area or demographic category …

Then you do a mail merge with your offer letter or email and save your database list so you can do a follow up a week or two later.

Simply targeting your offer results in …

• Lower mailing costs so increased gross margin
• Increased sales – you can refer to a previous purchase or expressed interest in your mailer
• Little risk of offending your customers by mailing offers irrelevant to them

Using your database you can keep track of your mailers too …

As each letter is generated by the mail merge a record is kept in your database so you’ll know at any time in the future which customers received a particular mailer. And importantly - those who responded and those who didn’t.

A list enables you to manage your Multi-step sequential marketing. It’s almost impossible without a database designed for the purpose. So you can execute stage 2, 3 … knowing those prospects who responded to the previous stages & those who haven’t – yet.

All too often you may have given up on a list because it was just too difficult to implement a multi-step process. If so, you’ll have a sneaky feeling of the amount of sales you’ve missed.

You can extend the list concept to "what if scenarios".

Produce a list of customers or prospects that fit a particular profile. Then review the numbers and if they’re significant try and match a product to the list.

All too often you can be product orientated and forget that your customer is only interested in benefits. Their profile often determines what they’ll be interested in. And if you get really good at it you can even predict their needs before they realise it themselves!

Whenever a customer asks for a product or service that you don’t currently offer make a note of it in your database. Then if & when you do have such a product you can extract a list of customers who may have previously enquired about it.

Customers appreciate customised attention – it shows you care about them and the service you provide. So use your database to build a profile of every customer.

Once established you can use it over and over again – without effort. Provided you keep the database up to date of course.

So long as the information you reveal to your customers is interesting and relevant to them they won’t object. No matter how frequently you contact them. And the more often they hear from you the less likely they are to speak with your competitors.

Based upon the information in your database you can make sure it’s relevant and importantly you don’t repeat the same message inadvertently.

If your database is flexible it can be used for more than just marketing. You need though to be able to hold all the information that’s relevant to your business. Don’t buy a product that puts you in a straightjacket!

You may decide to select a product that integrates with your existing application software. Whilst this may give you some perceived benefits do not compromise your selection of the best product for your business.

First though you need to make it happen for your business so … take the first step and select a system that meets your needs …

A Checklist For Selecting The Right Product For You …

It needs to provide everything discussed in this report and the things that are important to you. A useful checklist is …

• Can it cater for an unlimited number of customers or is there a limit?

• Is it a Single or multi-user system – so even if you start with just you as you take on staff you need to ensure they too can access the database – simultaneously.

• Can you choose the information you can record for every customer & prospect? Or are the items pre-defined?

• Is there a practical limit on the different types of products & services the database can hold?

• How easy is to extract a list of customers for mail merging? And can you save this for future use such as a follow up mailer?

• Is there an easy to use report writer or do you need to learn another product?

• Is it an "Open System" integrated with Microsoft products such as Word & Excel?

• How easy is it to analyse your marketing activities? And can it give you the information you need to monitor the success of each mailer, advert …

• Does it include "reminders" so you can be proactive – all the time?

• Is it really easy to use?

• … And all your other hot buttons