I made a follow-up call to a man about his marketing needs. He previously asked me to follow up, and so I did just that. Within about a minute of my call, he said “Well, this is a really busy time of year for us” and started with more excuse-crafting. I interrupted him to say “Hey Bill, I am not calling to waste your time” and quickly ended the call. What I really meant was that I was not calling to waste my time, and I think he got the point.
Bill is a man who knows very well why his company is bleeding money. He knows that he needs better marketing. That is why we have been talking. He expresses good intentions, but he always has an excuse. Is being busy a good reason to put off better marketing? Is money a good reason to put off better marketing? Is there really ever a good reason to put off something that will improve your business?
Let us consider where money comes from in most businesses. It comes from doing more business, and that means more customers. More customers comes from marketing. Is this really such a mystery?
“Procrastination Tax” is the Extra Cost of Waiting
People have been frustrated by taxes for centuries. They vote, they write their government leaders, and they even overthrow their government, but mostly they complain. They complain a lot! I hear people every day complain about the economy, and how everything is swirling down a big toilet bowl. I am not completely excluding myself. I don’t like it any more than the rest of you. The difference I make is that I realize one of the biggest “taxes” I pay is “procrastination tax”.
Putting things off until it is too late, or until the cost of waiting makes problems much worse is common. It is one of the easiest mistakes to make, and also one of the most damaging. The good news is that you have a choice.
For somebody like Bill who makes excuses, the additional cost caused by procrastination is high. He said that this is a busy time of year. It is the time when his business seems to be getting better. It only lasts for a short time, and then things will be slow again. Bill knows this, because he has been in his business and waiting for the next busy season for decades. Wouldn’t it make sense to maximize that seasonal opportunity, since it only comes once in a while? By procrastinating, Bill has effectively put off his best chance to turn his business around and stop losing more money until another year. Yes, another whole year before he will have another opportunity like he faces right now. Another year with mediocre results … and that is if all goes well. Another year to worry about whether he socked away enough to make it through the next slow period. Another year that he could have done more business and grown his company and had an even better year, next year.
I wonder how many years Bill can waste procrastinating before he realizes that action today is worth a lot more than action tomorrow. For some industries there is a year between each big rush, and for others it is a much shorter time. In any case, the tendency to wait for just the right time can have damning results to a company. I wonder how Bill will feel when he looks back a year from now and wishes he had set a better plan in motion. Oh yes, and next year will come … faster than ever.
Bill will always be waiting for something. While he waits for the perfect time, his procrastination tax is growing each day.
This reminds me of something my mother told me many years ago. She said “If you wait until you are ready to have children, you will never be a father.” I have three kids now.
Are you in need of a real bargain for your next website? I have a great deal for you today, and it starts at just $175,000 and $25,000 per month maintenance cost. But wait! There’s more!
It sounds like a great bargain, right? Well, maybe and maybe not.
I wish I had recorded the conversation I had with a woman desperately in need of an answer about website pricing. She just wanted to hear the answer that agreed with her. She did not have any desire at all to hear the right answer. I do have the urgent voicemail message she left for me, and I will include it in the podcast.
Listen Here:
After hearing the voicemail message, I promptly returned her call and she was even more frazzled in real-time. The purpose for her call was that she was frantically seeking some way to sway her business partners from an offer made by a website development company for what she believed was astronomically high. The part she could not answer was why it was too high, or how much too high it was. All she knew was that it was too high, and she wanted ammunition to fire back at the developer and her business partners.
I agreed with her that the $175,000 plus $25,000 was extremely high for a “basic website” or “simple website”. It is funny, but from a customer’s standpoint, they usually are just “very simple”. That is, unless you take them to the mat and have them show you just how damn simple it is by telling them to do it themselves.
I did my best to calmly and logically address the woman’s concerns and told her that this amount of money should indeed buy a substantially complex website with a lot of functionality, or otherwise be justified with some really fantastic marketing services. I expressed that there was very possibly a lot of fat to trim from the price, and that I would be delighted to review her requirements and provide a competitive bid for the project. To my amazement, she really had no clue about the site’s details. She did not have a project scope laid out with details of her needs. All she knew is that she was getting the shaft from some development firm, and she needed proof that the quote was many times too high. For all I knew, the pricing she had received was the bargain of the century. She wanted to hear nothing of the truth, and instead, she hung up the phone when I told her I needed more information to determine whether it was a good deal or a bad deal.
The point is that if you are shopping for technology or marketing services, the cost is really never too high or too low without the missing variable of what you are getting for the money. There was really no way I could tell her if the quotation she had received was ten times too high or one tenth of the cost it should be. Did it require two developers or two hundred? Did it involve tens of hours or thousands of hours? Did it include software licensing and a cluster of dedicated servers, or a shared hosting account?
The trouble I see with this is that it has become far too common that people who are non-technical and have little or no understanding of an industry to seek something based on cost and not on value. These are the people who get screwed to the wall with bad results and then blame an industry instead of pointing the finger back where it really belongs, which is at themselves for making fast assumptions based on cost of things they know.
Now, if you really want to know how much a website should cost, or how to determine website development or SEO rates, I invite you to read the articles as follows:
Of course, I could write all day about different pricing models and how to determine the cost of a website project, but in short, I will just say that if the price is all you look at, you are a sucker!
I would also like to add that if you are in such a rush to get your website launched that you do not have time to hear the professional’s answers to your questions, you may be a jackass, too!
Does Upbringing Affect Your Business?Money is a huge topic for businesses and marriage alike, and they are each influenced greatly by psychology. The psychology surrounding money is so profound that many of us lose all sight of why we do the things we do … and why others do the things they do. Losing sight of the power and myths of money will often create a huge confusion and misrepresentation for people in their marketing efforts. Yes, I am tying money, marriage, and marketing all together, and I will not get to the point in only a couple paragraphs, but upbringing and psychology really do have a place here in marketing. Here are just a couple thoughts for your day, and I hope you can find ways to use this.
I could write all day on the topic of people’s psychology surrounding money. Perhaps this is because I have been in business for a while … over 20 years. In that time, I have controlled squillions of dollars. I have seen how even the topic of money makes people squirm. Sales representatives may love to show their product, but when it comes time to ask for the money, it is the scary and uncomfortable moment of “yes” or “no”. Money is a top cause of divorce, and yet, seldom the top cause of happiness. I can say these things about money and back them with statistics, and I can say them from experience, because I demystified it by making a ton of money. I have earned money at rates that would make some countries jealous. I have also lost money at rates that would make most people leave a pucker mark in their seat. I know both sides of the money deal. I also know that overcoming money and doing great things for great purposes and putting the fears away can create even more joy, inspiration, and success than chasing the dollar. I even wrote a great (of course I say “great”) book about creating joy and inspiration. No, I didn’t write it for the money, either.
Basics of Money and Psychology
So, let’s look at the basics first: A business needs money to survive. They use their money to create more money. Of course, without money, a business cannot survive. Tragically, when left to their own devices, many businesses will focus more on what they sell, and forget to properly address this one essential fact: Every decision about money is made by a person. Even decisions coming from the most brilliant boardrooms and teams of financial experts still come down to people. They make decisions the best they can based on information, and some of the most important information comes from their experience. This means that their psychology plays an enormous role in whether they decide to do business with you or not. Regardless of the job role, whether it is as a spouse, executive, or etcetera, they rely on their decisions to please themselves and / or others around them. Making the wrong decision of buying from your company could come in the way of the things they seek. Are you surprised? Probably not, but how much do you consider this in your marketing?
The topic of psychology of money came to mind while I was on the phone with my wife as she was driving home from taking our kids to her parents home for a visit. Our kids will spend about a week with their grandparents, as they do each summer. They will catch toads, get muddy, and ride horses. We will miss them very much, but it is a great adventure for them.
We got to talking about the years we have spent together and the ways our upbringing still influences our companies. We will soon celebrate our eighth wedding anniversary, and we have spent nearly every day of the last ten years together, working, playing, and raising our family. We talked about the way her parents once really doubted our decisions and our ways of being self-employed and owning multiple companies. When we merged two of our companies back in 2001, I recall her parents liking me and hating me at the same time. We spent every dollar we had to build a business and create something big for our future. Her parents have always worked for companies and had a great sense of security from that. They raised their daughter (my wife) to think that way, too. They often did not understand our ways of sacrificing today for tomorrow, and the struggles it would require. I understand how a parent thinks. I have three kids. I want good things for them and I want them to always be secure.
It made me think of two dramatically different psychological approaches to money. There are the kind like them, who feel more secure with other people’s decisions about money. The company will handle all of the money, and they will give the employees their cut, in the form of a paycheck. Then, there is the kind who run the companies, make hard decisions about money for other people, and have what some would consider a risk taker mentality. I was raised by entrepreneurs who never understood the idea of having a job. It rubbed off, and I think working for somebody as an employee would be about the scariest thing. Actually relying on the mood or means of a boss to feed my family spooks the heck out of me. It seems to me that either approach has its risks. Either has its long term and short term advantages and disadvantages. I think most people live their lives in a safe space somewhere between my wife’s parents and my parents. They find a comfort zone that keeps them feeling good.
I say to heck with the comfort zone … you will never experience “spectacular” being comfortable. Your sofa is comfortable, too, but seldom very productive. That is just me … and yes, it gives me that crazy little edge you may have picked up on.
Companies have had a lot of shake-ups in the last couple years. People are doing jobs they never expected to do. Many have entered business ownership against their will or their plans. Markets have changed, and jobs are scary … self-employed or otherwise. Many people react with more caution than ever, and it is hard to call them “wrong” for this. Much of the reaction in a marketplace comes from psychology, and when it involves money, there is sure to be a look-back into their upbringing and the things which made them who they are.
Be careful how you address these matters of money and psychology. You may have to justify your cost more than ever. You may have to develop a more meaningful call to action and a better value proposition. It will make your company stronger and better than ever. It will probably cost money, too. Don’t fight it when it is for your benefit.
Would You Buy it for Half the Price?If you make your price the first priority in a cost to value comparison, you may want to reconsider. Cost is a fast way to get a lot of public attention, but it can also provide a negative net return. Showing a low cost has a solid place in some markets, but consider evaluating the cost and value propositions you present to your market. If you are building upon only an audience of “glancing prospects”, you may miss your best customers in the process. What I call glancing prospects are the ones who are out for cost, and that is the primary factor in their decision making. They glance in your direction and give little consideration to anything but how much it will cost. You may like these customers if you are content to offer the lowest cost, but they are also often not return customers or loyal to your brand. It is not just because you didn’t provide value, but because value is not what they were seeking. Thus, they never realized your value.
There are different kinds of buyers in any market, and there are still many who consider value over price. Even while shopping for identical products, many people will consider the value of buying it from somebody they trust or find other benefits from. It takes more effort to find value-shoppers than to find price-shoppers, but they are worth every bit of it. They will be back, and they will tell their friends.
I will use my industry as an example, but it is important to consider this in any industry. I sell marketing. In my case, value is all that really matters. Return on investment (ROI) is what makes sense to my clients. What they spend is not what matters but rather what they will receive for their money … which is more money. Profit is what my clients want, and they will do what it takes to get it. At the same time, I also attract a lot of “glancing prospects” and “lookers” without any intention of seeking value. Do you want to guess which one I consider important? That’s right … I want the ones who want the ROI and look closer to understand the value of my services.
Cheap Marketing and Low Value
Business people are cost-conscious, and more now than ever. Ironically, this often leads them to mistakes that sabotage their business efforts. As a reaction to their fears, companies will often drop their prices and subsequently drop their value. Marketing is the easiest cost to cut, but also the fastest way to reduce profit and go out of business. I watch companies all the time that neglect the value of their marketing, and try to use a cost proposition in place of a value proposition. It is a short-term cashflow bandage that becomes their undoing.
You can call me crazy, but I am smart enough to get dressed before going to the grocery store. In fact, I can be pretty downright bright, on a good day. I guess I am not smart enough to see the “wisdom” in some people’s reasoning of comparing cost above value. Some will try to weigh the cost with value, but often use completely flawed metrics for comparison. I see people all the time who do not understand how dangerous bargain hunting can be when it comes to their marketing, or with other purchases.
How Valuable is Marketing?
Marketing is what makes companies money. Marketing is how customers find companies and companies find customers. Marketing, in some manner or another, is the only way a company will earn a profit. Marketing should not have a net cost, but rather a profit gain. Marketing should be viewed as an investment, and not an expense. Seeking the lowest cost for something so value-driven seems like the absolute absence of logic. Looking for value, on the other hand, is brilliant.
Do People Really Seek Cheap Marketing?
Yes, a lot of people ask questions about the cost of marketing and rates for marketing-related services. At least that is what my website visitor logs show me. Perhaps you see the same in your industry. I am including a list of cost-related things people searched for and found my blog. Some of them are pretty amusing. People even found my blog searching to find how much it costs to join Facebook.
One of the first things a person in my field often hears is “how much will it cost?” I weed these out fast, because when cost is the question and value is secondary, usually the person asking fits into one of two categories as follows:
They do not have enough money to afford quality marketing. If they do not have the money to do things right, they will never be pleased … ever. It is the same kind of client who tries to tell the consultant what to do rather than accept the consultation they pay to receive.
They ask about cost because it is the question they know best. They assume that a lower investment comes with a lower risk, but this is really not the case. This assumption places the value equation completely backward. Without value, the cost of marketing does not matter. It is not worth it at any cost, and can often have disastrous results.
Similarly, in your line of work, you will likely find that if your prospective customers recognize the value of what you offer, they will often find a way to deal with the cost.
Marketing Value and Cost Consideration: Do You Buy Price Tags?
I have never bought a price tag, but I have purchased a lot of things with price tags on them. Sure, some people buy price tags … literal price tags. What I mean is whether you look at an item and decide that you want it and then look at the price tag, or do you look at the price tag to decide whether you want it. Think about your customers and how they may address this same question. Value-seeking customers will decide whether they want or need something, acknowledge that they want or need it, and then look at the price tag. Cost-seeking customers will look at the price tag and if the price is “right” decide whether it was something they were even interested in buying. They love to look, but they hate to part with money more than they enjoy what they receive in return. NOTE: For this customer, the “right” price is highly subjective to poor interpretation.
Cost, Rates, and Value: Lookers Are Everywhere!
Glancing prospects are very easy to lure. I can drag them in by the truckload. Just have a look at these recent searches people performed to land here at my blog, and then consider how many of these I will likely do business with. Don’t get me wrong, because I like when people ask about cost. It is a buying sign and tells me they are in the market. The fact remains that when somebody asks me about cost before understanding value, I normally tell them kindly that they are simply not ready for what I offer. What I offer is profit!
There are enough people asking about cost, but it is funny to find that a comparatively few people ask questions of value. Those are the people I want, and I hope you can see the value in this, too!
Note that my list of “What Cheap People Search For” is based on actual terms people typed into a search engine and clicked on my blog. I couldn’t make this up if I tried. You may not be as amused as I am, but somebody actually wanted to know “how much does a sheep cost” … really, a sheep. Darn, I don’t sell sheep. You can bet that if I did sell sheep, they wouldn’t be cheap sheep.
Juan Martin Diez: 18th Century GuerrillaIf you struggle to produce the money needed for marketing, you had better learn some guerrilla marketing, and fast! You should always assume that somebody else in your market segment has deeper pockets and the longer you wait the harder it will be to reach the customers. When marketing a business with a small marketing budget or no marketing budget at all, you can still improve your chances of success using free or very low cost guerrilla marketing.
How to Grow a Business Without a Marketing Budget
I do not want to let you down, but the truth is that it absolutely cannot be done. You will have to budget something, and if it is not money, it will be time … probably a lot of time. Be ready for that, and budget your marketing time. Set aside a scheduled time to learn more, do more, and earn more. This is your business we are talking about and if you have a family to feed, like I do, it really starts to seem worth it to make it a success. Budget your time well, because although you may think you are too busy to budget time for marketing, the truth may be that you are just busy with the wrong things. If you are marketing your business well, time in other areas will almost surely free up for you. While you are budgeting time, be sure to budget enough to finish reading this article. I have some guerrilla marketing tips for you.
Useful Guerrilla Marketing Tips
I am going to give you some free and effective guerrilla marketing tips that you can start using today. I will also welcome your thoughts and additions, but if I try to add more than a short list, I will be writing this all day. This is only intended to help prime you for the task of marketing your business.
Guerrilla Marketing Tip Number One: Get Uncomfortable
If you are sitting back in your easy chair feeling comfortable about your marketing, you are not ready for this. If you are marketing without a budget, and you are comfortable about your marketing, you are really not ready for this.
One of the first things I would suggest for anybody trying to grow a business is to get uncomfortable. The more uncomfortable you are, the more likely you are to take serious measures to do something about it. If you relax and think things are just fine, you are just asking for that comfortability to all slip away. I have been in business for over 20 years and I have seen the good times and the bad times. I remember joking with my wife while living in my ivory tower and having a whole lot more time and money than I ever thought I could want or need and saying “I’m tired of living like this.” I actually joked but also kind of meant it, because while earning more per year than an average family does in ten years can be fun and all, a fall can also happen a lot faster. I have seen it … the hard way. Never get too comfortable, and always find reasons that you are “tired of living like this.”
Guerrilla Marketing Tip Number Two: Find Success and Follow It
Find success and follow it! Look for what successful people have done and learn from their experiences. I am not saying to imitate their every move, but rather to learn what they know and find ways that it can be applied to your marketing efforts. Many successful people will blog about their experiences and are happy to share what is in their head. Read blogs until your eyes hurt! Although it may seem like a waste of time at first, look at it this way; if you want to know how to do something better, doesn’t it make sense to use what others have learned instead of trying to learn it all the hard way?
Do not believe everything you read, but choose carefully and read a lot. Pay attention! Pick out a handful of blogs and spend some time to do more than just scan and click. Your competition is scanning and clicking through a lot of information. You want to learn and improve your business profitability, so what you should know is that even a little of the right information is better than a lot of average information. Get involved and find information pertinent to your industry. Find information from marketers who know marketing. Find things that challenge convention, because conventional is what everybody else is doing. Here are some blogs to help you get started, and of course I should mention that I have a blog archive with many nice trinkets to share.
Don’t just sit there! Learn opinions from other readers and add your comments. Note that while you are commenting that there is a place to enter your web address URL and it will create a link back to your website. If you are active in blogs, those links can add up to a lot. It is also a great way to become familiar with other frequent readers or people who had a common interest. Reach out to them and find out what works for them. Also be sure to read “10 Really Good Reasons to Blog” … seriously, add it to your time budget and read it!
Guerrilla Marketing Tip Number Three: Look Where Your Market is Looking
Look where your market is looking. I want to be really clear on this when I say that your customers are using the Internet. I was recently visiting with an old client of mine who is in the railroad construction business. They came to me about a website several years back, because they knew that they were supposed to have a website. They did not really know why, and their biggest focused use of it was to find job applicants. Even today, they still find it hard to comprehend that the people out there who make decisions about who will build their railroad bridge or railroad extension are using the Internet. Think of it this way, if you were running this company, even if they are not using the Internet to search for where to buy a railroad bridge, you should be there to increase their awareness of you. The company spends virtually zero money or effort in marketing, yet they want more business. This is what happens when you stop saying “I’m tired of living like this.” The moral of the story: Don’t get railroaded by thinking that your customers don’t use the Internet. Unless your potential customers live in caves without computers and no cellular signal, they are using the Internet every day. Just because you do not sell the product online or receive immediate gratification does not mean you can slide by without it. Selling more of what you offer does not always mean you are pitching them your next deal. There is a reason that Mc Donalds runs ads that say “You deserve a break today” and not just “$.99 Big Macs for a limited time at participating locations.” Branding is important, and the company the potential purchaser has heard of will have the upper hand.
Guerrilla Marketing Tip Number Four: Guerrilla Marketing is a Stepping Stone
You should be aware of some basic assumptions about companies that try to perform marketing without a budget. You need to know this before you can overcome it. If your marketing budget is small, we can make a couple of accurate assumptions. Whether these assumptions are right or wrong, it is very likely how your prospective customers and your competition will perceive your business, so be aware of this. Here is the first assumption about marketing without a budget: If you do not have a marketing budget, it is pretty likely that you are broke. Successful companies that can afford marketing do not flinch at the idea of investing in growing their market share to squeeze you out of the picture. This brings me to the second assumption about marketing without a budget: Wouldn’t you, if you were them?
You could just try the old line that you don’t spend money on marketing because you are trying to keep your cost low. Sorry, anybody who has ever been in business will see right through that one. Let’s face it, your cost is lower when your company is productive and making money. Marketing does not create a net loss … it creates profit, money, business, customers, growth, market share … you know, all of those things you want more of. Marketing lowers your cost by making your business successful.
Guerrilla marketing is a good way to get started, but businesses that do not reinvest in professional marketing services will often fall into a wasteful trap that they are not able to get out of. Once you have seen the benefits of good guerrilla marketing, use it for professional marketing. You probably answered affirmatively when I asked “Wouldn’t you, if you were them?” Stop imagining that you are above this one very basic law of successful business: It takes money to make money. Remember that without experienced marketing talent, it will be much harder to get your hands on money. It is like a chicken and egg question, only worse: What came first, the money or the money? The more you invest, whether time or money, the more you will receive in return. If you use guerrilla marketing as a stepping stone to grow beyond your current constraints, you will then understand why you did all that reading i assigned you.
I will have some more tips for you soon, so budget your time and keep coming back.
