Tag Archives: sales channels

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How to Thrive in the New Year

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Whether your venture is a recent start-up or a mature entity, it is a given that business owners and leaders must continually take steps to spur business health and vitality—in other words, growth = life. Many small businesses don’t make it past their first few years so to increase your chances of success, you have to be strategic from the very beginning. It’s important to direct your energy and resources toward actions known to work. Without a rationable straight-forward plan for growth, your business could struggle to take off and become sustainable. Presented here are five basic growth strategies, one or more which will likely work for your enterprise.

  1. Increase market penetration
  2. Indentify new channels
  3. Introduce market segmentation
  4. Develop partnerships
  5. Prioritize exising customers

Market penetration

This is a fancy way of telling yourself to cultivate a thriving client roster that is populated by a mix of new, lapsed clients who’ve been enticed to return and, best of all, legacy clients you’ve worked hard to keep within the fold. Market penetration is arguably the most critical business strategy of all; Freelancers and small businesses owners and leaders would be wise to employ ongoing tactics to take aim at long-term success with the use of a good market penetration strategy.

The goal is to increase sales within your current market. This can be difficult, as it requires you to beat your competition, but appealing to your current client list is an often successful path to growing sales revenue and profits. Clients do business with those they know and like and they do more business with those they know and trust.

New selling channels

Finding new opportunities to sell your products can be an excellent way for your small business to grow, especially if your current market is highly competitive. The internet has opened up alternative selling opportunities, giving you unexpected and innovative ways to reach out to not only your existing clients but to other markets, too. For example, if your business is online-only, consider opening a pop-up shop, maybe to capture Valentine’s Day or Mother’s Day shoppers. If the strategy is promising, consider devising a way to become a permanent fixture at the pop-up location. See the partnership heading below and consider the possibility of a consignment arragement with a vendor colleague whose products complement yours.

If your small business operates from a physical store, then do the reverse and consider selling certain of your products online to broaden your reach (work with a skilled product photographer who will make your products look their best). B2B service providers can perhaps bring certain of your services online—maybe coaching sessions conducted by way of videoconferencing?

Market segmentation

Here, we have another fancy term for a simple tactic. Freelancers and small business owners often struggle to get traction in large markets because it’s nearly impossible to compete with bigger and better-financed companies. They’ll out-flank you on every metric, from breadth and depth of their product line to the advertising budget. For this reason, you might need to reevaluate your brand’s place within your market and hyper-focus your preferred playing field.

Think niche. Market segmentation involves dividing a broader market into smaller groups based on demographic information or buying habits. Then, you can choose one of these segments for your niche target audience. Marketing to a highly specific group of potential customers is easier than trying to appeal broadly to a massive group.

If you offer more than one product or service, market segmentation also helps you promote different products or services to different consumer groups. Taking this marketing approach will require careful research to discover which market segments are the most likely to buy each of your products or services, so be prepared for a time-intensive process. You can use email surveys, website analytics and purchase histories to find trends in your existing customers’ demographic or behavioral traits. Once you identify the most appropriate market segments for each of your product categories, create more targeted content for potential clients.

Partnerships

Partnering with another small business gives all parties involved access to a wider audience and if all works according to plan, everyone generates more sales and makes more money. However,

You’ve gotta know who you plan to dance with because a disappointing partnership deal can get ugly and steps must be taken to avoid misunderstandings and confusion. Due diligence is imperative when proposing a partnership of some sort. It is critical that you discuss the agreement—- responsibilities of the partners and expectations for outcomes—-in advance and, ideally, in face2face meetings. Then, follow up the agreement with unambiguously written emails. Due diligence is a must- do when proposing a partnership of some sort.

The partner’s products and services should be complementary, never a competitor, to your line, to ensure their client base will have an interest in your products or services. Ideally, a partnership should significantly benefit both business ventures. A partnership can take any form, from selling items on consignment to co-hosting a full or half-day professional development conferenceto sub-contracting a portion of a project where your own expertise would fall short—providing graphic arts or videography services at an event where you are he principle player. services could be an opportunity to tackle a big project by combining your resources, and it can be a chance to connect with another professional who may be able to offer their wisdom or skills. You could work with a partner to develop a new product, or you could host an event that promotes both brands. A consignment sales arrangement is usually low-stress and can be tested quickly and easily to illustrate how partners can work together.

Current clients

One of the most ill-advised yet common strategic missteps that business owners routinely make is prioritizing new client acquisition over developing client retention protocols. Clients with whom you have a history have demonstrated their confidence in your organization and need only a little love from you and your team to secure their loyalty and future business. While there is no doubt that recruiting new customers is an essential business goal, it is in fact customer retention that is the key to business success, as we discussed above in market penetration. Convincing a client to remain (or return) to your business is far easier than convincing a new client to give you a chance. Client retention is the engine that drives sales revenue and profit. Moreover, current and returning clients are your cheerleaders and are a good source of word-of-mouth advertising.

BTW, an email marketing strategy is probably the easiest way to stay in touch with the roster of clients you regularly work with. The right call-to-action will help you persuade clients and other website or social media visitors to surrender an email address in exchange for receiving something (free) that they value, such as an interesting report, informative e-book, revealing case study, or link to a podcast or webinar in which you participated (always provide an opt-out feature).

To your curated list, you may promote your brand and yourself by sending updates about new products or services, talks you’ll give, classes you’ll teach, charity events you’ll join, special pricing deals and other relevant news. Finally, you can as well demonstrate your respect for your clients by periodially conducting (short) surveys to guage their opinions on how you address their needs and what you can do to improve the client experience.

Thanks for reading and Happy New Year. I appreciate your presence and support!

Kim

Image: This is how we do it. Window washers from a family-owned small business in Gresham, OR working for a local small business colleague. © The Oregonian March 21, 2013.

Sales , , , , Leave a comment

More Sales Channels Means More $ales

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If you’re ready to greenlight a business idea that you feel has money-making potential,  then it’s time to create your road map to entrepreneurial success! Learn to build a Business Plan that will become both the foundation and launching pad for your exciting new venture. We’ll take a deep dive into all the ingredients of a basic Business Plan, including how to evaluate the profit-making potential of your business idea; define your ideal customer groups; evaluate competitors; develop a savvy marketing and social media plan; and build a solid financial strategy that will sustain your dream.  Thursdays March 28 & April 4 6:00 PM – 9:00 PM. Register here.

The number one job of a business owner is to sell the company’s products and services (at a profit).  To achieve this goal, numerous activities are undertaken to promote, support and sustain the sales process and its co-dependent twin, the buying process.  The push-me, pull-you of businesses selling and customers buying rests on a vital and complex foundation.

The business model, i.e., the rationale for how a business will generate sales and make a profit, is the starting point.  In the business model, the products and services that will be sold and the target market(s) are identified.  The method(s) and location(s) by which customers will obtain the products and/or services and the payment protocols are also detailed (E.g., do customers pay in full in advance, or do they pay a deposit and then the balance when the product or service is delivered? Is this a bricks & mortar or e-commerce operation?).

The value proposition, perhaps the most important component of the business model, will describe why prospective customers are expected to value and purchase the products and/or services that the company plans to sell.  Estimating business start-up costs and preparing a credible Break-Even Analysis to provide a time line that predicts the expected pace of sales revenue growth that products/ services are expected to achieve, will determine when profits can be expected to accrue and is yet another purpose of the business model.

Business strategy rests on the business model and marketing strategies, campaigns and tactics lend still more support to driving the selling – buying process.  Yet after all is said and done, it’s imperative to get the products in front of potential buyers.

Savvy business owners know that those with motive and money to buy what your company sells need a little help.  Offer your products and services (where applicable) through different sales channels and make your products/ services easy for customers to buy.  Map the selling – buying process at your organization, talk to and survey your customers and then consider which sales channels, direct, indirect and hybrid, will make it more convenient for customers to do business with you.

Direct Channels: The selling – buying is done through channels, or might we say venues, that you control.  Customers may visit your office or store, or they may buy online through your website.  You might also offer certain of your products and services on your Facebook page.

According to 2018 research conducted by Hootsuite, there are 2.32 billion Facebook users globally, 1.1 billion speak English and about 10% live in the U.S., 232 million. 78% of American users have discovered retail products to buy on Facebook.  Customers will click your Facebook Store tab once you build it out and take it live. Payment processing and customer transaction history are handled by Shopify and Facebook does not take a commission on your sale.

Indirect Channels:  Have you ever booked a plane ride or hotel through Expedia, Hotels.com, Orbitz, or Travelocity? If so, you are comfortable buying through an Indirect Sales Channel and you could be ready to sell selected products and services through this method.  I’ve promoted and sold my P.R. and writing services on Upwork and LinkedIn ProFinder.  Self-published authors who produce books through Create Space have Amazon for an Indirect Sales Channel.

Tangible products have a much longer history with Indirect Sales Channels.  A company can investigate the possibility of selling products to a wholesale distributor, who in turn sells to retailers.  Freelance artisans often place their hand-crafted items into (typically locally owned) stores on consignment.  In both scenarios, products gain access to a significantly larger pool of target market customers than would be possible if the business only used Direct Sales Channels.

Hybrid Channels: Describes two or more sales channels utilized to provide a multi-channel product promotion and distribution system that will maximize product sales. Starbucks offers an easily visible example of Hybrid Sales Channel product distribution.

The primary sales channels are the free-standing Starbucks restaurants that are sprinkled throughout commercial and residential neighborhoods in countless cities and towns across the country.  Secondary Starbucks sales channels are found in many Barnes & Noble bookstores, chain grocery stores, hotel and hospital lobbies and airports.  By way of Hybrid Sales Channels, Starbucks successfully carpet bombs key shopping districts coast to coast.

Small and medium business owners cannot compete in this manner, but it may be possible to offer products and services through two or more sales channels to broaden product exposure and drive sales.

Thanks for reading,

Kim

Photograph: Leslie Jones (1886 – 1967) Pushcarts on Blackstone Street, circa 1940   Haymarket in Boston, MA. Courtesy of Boston Public Library.