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The 5Ps of Marketing In Your Home Business

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This entry is part 2 of 3 in the series Start Here

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MARKETING strategy has traditionally been broken down into a formula known as “the 5P’s” – the five factors that make up a marketing strategy. If these are done consistently well, they can be a very useful guideline for growing your home based business.

Many topics have been proposed on what the 5P’s should be. The list typically includes: People, Product, Place, Process, Price, Promotion, Paradigm, Perspective, Persuasion, Passion, Positioning, Packaging, and Performance.

Here, we will offer our own version of the 5 P’s and attempt to move away from theory towards practical steps you can start implementing in your home based business starting today.

1. Price: increase or double your price

Want to try something new? The next time you’re speaking with a prospect or client, when the question of price comes up, DOUBLE your normal price and see what happens.

Have we gone mad?

Think of it this way – Maybe YOU’RE crazy for not charging what you’re WORTH, choosing instead to compete on PRICE. Problem is, if you choose to compete on price there will always be someone else who’s cheaper. You can’t win this game.

THE easiest thing for your competition to do is simply undercut your price. It takes no imagination, creativity, innovation or market leadership to lower the cost of something. Nobody wins. Lower prices mean lower profits and studies have shown that a 1% drop in price leads to an 8% drop in profit.

But what if the opposite happens and you double your usual asking price?

One or several things may start to happen:

  • Your prospects or clients may start seeing your product or service as having higher value
  • This may increase the prestige of your product or service in the eyes of your clients
  • Your prospects may start trusting you more
  • An increased level of confidence in your offering

If you've got the power to raise prices without losing business to a competitor, you've got a very good business. And if you have to have a prayer session before raising the price by a tenth of a cent, then you've got a terrible business. I've been in both, and I know the difference. - Warren Buffett

PEOPLE talk about their $200,000 Italian sports car or $21,000 platinum-plated cell phone. Nobody talks about their $19,000 GM sedan.

And perhaps this means you’ll lose a few unprofitable clients along the way. If you don’t lose some unprofitable clients, you won’t have room to serve the more profitable ones when they come along. It’s professional suicide to continue focusing on serving a market sector “that can afford” to pay your old (low) prices. Price doesn’t find clients. VALUE finds clients. And those clients that value your work should – and will –  pay according to that value.

Be expensive or… be free

FREE is also a powerful price point. And, of course, free is remarkable. But only as another tool in the toolbox – you increase your price when you give VALUE first. For free. What you can’t be doing is increasing the price without backing it up with the vale.

Got a great suggestion that will help get a client to the next level? Great! Share it with them. Even better, got a business lead for them? Hand it over! Did you come across an article or a piece of research that directly impacts their business? Share it with them. That client’s now become a fan for life.

2. Personality: start getting personal

GETTING personal means getting to know your customer better. Live in their world, get to know about their challenges and their aspirations, and think about what keeps them up at night.

Research. Preparation. Homework. These 3 words are your friends. Industry news and developments are now at your fingertips. If you’re not intelligently researching your prospect’s issues, challenges, and pressures, how can you possibly come in with a credible solution?

Don’t just sit at your desk all day. Make sure to go out and network whenever you can. Just speaking to people one on one can give you so much feedback. Or you can even just hit the street. Visit businesses, talk to your contacts in the fields you serve, get some firsthand information about what’s going on in their world – what are their challenges, perspectives, obstacles, priorities; what are their dreams, their “only-ifs,” and their biggest aspirations? The point here is to be creative.

Sounds like a lot of work, doesn’t it? The reality is, the majority of business owners don’t put in half as much the effort they could in getting to know their customers better. Which is exactly why you will be way ahead when you do take the time to do that.

3. Partnership: become a partner your customers can trust

trusted-partnerWHAT this often means is “going above and beyond” so to speak. It means putting in the work and commitment – yes, the real, hard work – that makes the difference between being a peddler and being a partner.

THIS alone will set you apart from the rest.

Behave like a professional and your prospects and customers will treat you like a professional. Behave like an amateur and …

HERE are a few behavior traits that mark you out as an amateur:

  • Lack of preparation
  • Lack of interest or intent
  • Not listening to your prospects and being aggressive
  • Lack of industry or product knowledge
  • Not following through on your conversations
  • Taking customers for granted
  • Lack of awareness of the customer’s operations
  • Failure to keep appointments
  • Lack of creativity
  • Failure to keep promises

4. Positioning

market-positioningYOU can’t be all things to all people. Positioning is about finding your niche and claiming your expertise in a particular field. You want to become the “Go-To Guy or Gal” for your specific product or service ; you don’t want to be a “jack-of-all-trades” and master of none.

Let’s take a common example. There are lots of graphic design companies out there that do all sorts of work – websites, logo design, brochures, collateral material, etc. You name it, they do it. And business is generally OK.  But many of them have a hard time differentiating themselves from their competition and others find it challenging to develop a strong client base and referral network.

They could probably do a lot better if they specialized in say, graphic design for Facebook ads. So if you wanted a killer Facebook ad with bold graphics, custom or stock photography, clean layout, and a strong, compelling message, they would be the go-to people. Now I’m not saying there is even a need for graphic designers that specialize in Facebook ads but the general idea is to niche yourself out.

5. Performance

Right now, we are all lost in a sea of gray. Me-too rules the day. Everywhere you look, there is more and more of the SAME OLD THING sold by the SAME OLD PEOPLE in the SAME OLD WAY. Boring. And deadly.

The problem is that people don’t buy boring. If you and your company and your products and services blend into the background, you might as well close up shop right now. Let me put it another way: all companies go bankrupt. It’s just a matter of time. Want proof? Out of the 100 largest companies of 50 years ago, 17 survive today. And none of those 17 are the market leaders they used to be.

Why? If you’re not separating yourself from the crowd, you’re blending in – and nobody will even notice you, much less seek you out and tell their friends about you.

The key to success is to find a way to stand out--to be the purple cow in a field of monochrome Holsteins. - Seth Godin

Here’s an example of a company that really hasn’t been doing a bad job – but they’re also not that exceptional.

On a recent call to a certain credit card company, an executive was straightening out a billing error. At the end of the call, the customer service rep asked, as was required “Have we exceeded your expectations?” to which the exec flatly answered, “No.” There was a billing error, and the rep fixed it. That’s to be expected.

Now, if the rep had offered the executive a $50 gift check in recognition for the inconvenience, THAT would have exceeded expectations. That story would be worth repeating to 10-20 people. I cannot imagine the executive telling everyone, “Hey, I called this company to fix my billing error. Guess what? They did it!”.

Here are a few guidelines to test if your marketing and sales strategies are outperforming your peers – they are if you’re doing something that:

  • Hasn’t been done before – make sure there are results to back it up
  • Customers and prospects make positive comments
  • Goes against the status quo – again, not just for the sake of it, needs to be backed by results
  • Your competition can’t copy you

Get silly. Get crazy. Get an attitude. Get noticed.

Author Seth Godin perhaps put this most succinctly when he said

Safe is risky. And risky is safe.

And remember the immortal words of Jerry Garcia:

You don’t want to be considered the best of the best. You want to be considered the only ones who do what you do.

Series Navigation<< 7 Habits of Highly Successful Home Businesses11 Powerful Time Management Tips For Entrepreneurs >>
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Impellium is an online media company focussed on personal and business growth strategies for home business owners and lifestyle entrepreneurs.
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