Success Stories to Help You!
When your marketing is not working, don't do more of the same, CHANGE!
These "success stories" about small businesses like yours have helped many owners find a new way to make the cash register ring. Each one is a quick read with a strong, practical lesson for you to consider.
LYNN AND MARGARET opened their dot com site with great hopes of
selling higher priced products for babies, like strollers and cribs.
But sales were flat. People were visiting, but not buying.
Then Lynn heard about a research study that found NEW buyers have a
much harder time making a decision about products because they don't
know how much importance to give to each of the attributes of the
"I see," said Margaret. "Our new moms don't know if they'll be
happier with a heavy but sturdy stroller or one that's lightweight
but more flimsy."
"Right. And if we help them make a wiser decision, we should
get more sales. We do have good prices."
Lynn surveyed a group of moms and found over 70% of them
ranked weight as a more important attribute than sturdiness. They
ranked six other attributes of strollers, too. Margaret created a
Web page where visitors could check out how experienced moms ranked
many attributes of their products, and which products they liked the
most. And she put a "Buy" button next to each of the choices.
Within a few weeks they could see that sales were climbing.
And that a large number of them coming directly out of their
LESSON: People don't just buy products, they buy all
of the attributes of those products. The less they know about which
attributes will give them the greatest satisfaction, and which will
cause the greatest dissatisfaction, the more likely they are to keep
hunting until they have a "feel" for that information. If you give
it to them, you're more likely to get the sale.
ALAN AND FRED'S FLORIST SHOP was doing OK, but they wanted to get
more out of their new Web site. They were getting visits and orders,
but more at the lower end of the price spectrum. Then one day Alan
heard about a research study on 'self-prophecy' which found that
people who BELIEVE they will take a certain action in the future,
like voting, are more likely to do so than others who aren't
asked-like a self-fulfilling prophecy.
"Fred, we can use this idea," said Alan.
"How? Give discounts to voters?" asked Fred.
"No. We'll set up a little two-point rating scale next to
each picture of an expensive arrangement and ask people to give us
"What would it say?"
"Choice one would say 'I'd buy this' and choice two would be
'I wouldn't buy this.' Keep it real simple and fast for them."
"We'll get some good information, but so what?"
"Don't you see? If they consciously rate an arrangement as
one they'd buy, then they have unconsciously made a prediction about
future behavior. Like role playing."
"I get it. They sort of see the arrangement in their home or
wherever and decide they like what they see. So they're more likely
to buy it. Pretty clever, Alan."
Alan and Fred did exactly that, and their Web site sales of
high-end arrangements took a big jump.
LESSON: Imagination is a powerful selling tool. Get
buyers to rate your product, make a 'make believe' decision or even
guess which product they'd like most. That's a big step toward
making the sale. Like the car dealers say, "Imagine yourself driving
this new Cadillac."
MARIA AND LUIS have a successful online business selling gourmet
food. Last year they wanted to increase sales, and give something back
to the community. They remembered that Ben & Jerry's Ice Cream gave
a part of each sale to help save the Amazon rainforest.
"Let's do that," said Luis. "We'll give a percentage to the
March of Dimes."
"We're not Ben & Jerry's, Luis." said Maria. "How do we know
it will work, and which products will we offer the deal on?"
Luis replied, "Let's ask Roberto."
Their son Roberto was a senior at the local University. A
week later he told them about research which showed people are
several times more likely to buy products tied to a charitable gift
if they were "personal pleasure" items, like candy, ice cream, visits
to a spa, etc. When the offer was made on more utilitarian items like
soap or haircuts, it wasn't very effective.
The research showed it didn't seem to matter how big the gift
was - the research used 5% and 50% of the price. "They think," said
Roberto," that a lot of people feel a little guilty spending money
for 'personal pleasure' items, and this is a way to make the purchase
more acceptable. In fact, they'll even pay a little more if most of
the increase goes to charity. It doesn't even seem to matter which
good cause, as long as its well known."
Maria redesigned their Web pages to show that 5% of the
purchase price was going to the March of Dimes, but she limited the
offer to gourmet items that seemed particularly "pleasurable," like
expensive truffles. And sure enough, the sale of those items
increased. They even got several e-mails complimenting them.
LESSON: Charitable donations as a marketing strategy
can pay off, but it probably won't work on auto parts or dog food.
Picking a "personal pleasure" item is your best bet for increasing
sales while doing good.
MONA AND ROLAND's dot com health foods business was struggling.
"We're getting the hits that could make us a living if we could get
the sales," said Mona. "What can we do?"
Later that day Roland showed Mona a report he'd found online.
"Here's a research study that says just listing the good points
about our vitamins isn't enough. We need to 'inoculate' our
"Inoculate them? Why?"
"What happens is they leave our site thinking our products are
good, then they're persuaded to buy from someone else."
"So what do we do?"
"We pick some of the selling points used by competing Web
sites. And we show how our brand is superior to them on each of
"In other words, it isn't just comparisons, its like 'search
and destroy' their key selling points?"
"Right. Like, if they say their brand of calcium is great, we
point out that doctors say calcium needs lysine for maximum
absorption, and their brand doesn't contain lysine, but ours does."
"So when they get to another site, they've already been
inoculated against the sales pitch."
Roland's new Web pages pointed out their competitors' claims,
then refuted them with backing from independent, scientific sources.
And it worked. Sales started to climb as more people returned to buy
LESSON: Try inoculating your visitors against future
persuasive arguments by competitors. Point out the problems your
competitor's brand causes, then show how yours does as good or better
a job without the problems. One important point - studies show
people don't like you to be personally derogatory. Like Joe Friday
said, "Just the facts, ma'am."
TIM AND JUAN own an insurance agency. They decided to
go online to attract new customers and serve current policyholders.
"Our site should tell people about all the good features of
our life and health policies," said Tim.
"Features are good," said Juan, "but we should emphasize
emotions, too. Promise to relieve their fears about the future, and
guilt about leaving their family in a tough situation."
"Right, but how strong should that be?" asked Tim. "We don't
want to go over the top."
A few days later Juan said to Tim, "I think we need to be
pretty forceful with our fear message. I found several psychological
studies that show people usually think they are less likely than
others to have health problems, or to die in an accident. In fact,
they are convinced that they're less likely than others to have any
bad things happen to them, even when they have no logical reason to
"So we need to have a message that will jar them out of that
`it won't happen to me' idea," said Tim. "Otherwise a lot of
them will continue thinking they don't need our help."
Juan and Tim decided they needed to force people to look
squarely at their subconscious belief that they were luckier than
other people. They used quotes from several clients they had helped.
Each one emphasized their former belief that `it couldn't happen
to me' -- until something bad did happen -- and how glad they were to
have insurance when it did.
LESSON: If you sell a product or service based
on something bad happening to your customers (insurance agents,
dentists, doctors, morticians, lawyers, etc.), be aware that you must
overcome your customers' `it won't happen to me' bias before they
will really feel a strong need of your services.
JANICE AND CINDY have a personal enhancement business,
teaching people how to network, communicate with others, appear
more polished in interviews, etc. They have a Web site that gets a
lot of hits, but isn't making the phone ring.
"I think we need bigger discounts and specials," said Cindy.
"Maybe," said Janice. "But are we sure our message is
getting through? Is it stimulating their real buying motivations
then promising to satisfy them?"
The next day Cindy showed Janice some research she'd found
online. She said, "Look, these studies show people often way
overestimate their abilities compared to others, and overestimate the
number of people who share their opinions."
"So that's our roadblock! They think they don't need our
"And they really do. They think they have better
personalities than others think they do, and believe they are more
skilled and popular than they really are."
Using that information, Cindy changed their Web site message
to strike directly at those false beliefs. The message emphasized
how overconfident their clients had been, until they blew an
interview or first date. They even quoted some clients as saying
they had been certain they were `cooler' than most other people,
until they found out the hard way that they weren't.
The strategy worked. Now Cindy and Janice are getting
calls as well as hits.
LESSON: Our self-flattering social comparisons
are the flip-side of our beliefs that `it can't happen to me.'
Most people believe they are better than others in order to create a
positive self-image. If you have a product or service that people
know they deserve for being exceptional, you can play off of that
image in your marketing message.
But if you're like Janice and Cindy, you've first got to
convince them they need what you're selling.
GARY AND PAULA own a dot com company that sells household
cleaning products to consumers. As Paul says, their problem is
they've got a lot of lookers, but not many buyers.
"What's wrong?" cried Paula. "We've got great prices and
name brand products!"
Paul did some research and told Paula, "One problem may be
that we're too dull. Evidently, people see companies as having a
personality as well as an image."
"Personality? Like people?"
"Right. Take Microsoft. It has an image for high quality
software, but a lot of people also see it is a powerful and arrogant
company. That's its personality to them."
"Since our company is just a Web site," said Paula, "the
personality it conveys is the one people give to our company, too."
"And that personality is dull, dull, dull."
Paul and Paula got busy changing their site to create the
sort of personality perception they thought buyers would like. They
brightened the look and sparkle of the site, inserted a couple of
humorous stories about their struggles to get started, created a
cartoon character for their best product ("Hey," said Paula, "it
worked with Mr. Clean!"), and emphasized their honesty by offering a
Now they hear good comments about their site, including
their favorite, `Your site seems so friendly.' They've got an
online personality that works for them.
LESSON: Sometimes a factor that seems insignificant to us
can play an important role in turning lookers
into buyers. What sort of personality does your site convey? Is it
one that makes people pleased to do business with you? Most folks
still prefer to do business with companies they like and trust, even
JOHN and JESSE own an eyewear store.
They wanted to use their Web site to build store traffic,
but it hasn't worked well. They have generated a
growing number of visitors, but most of them only
come once, and few of them become store
"We've tried to make our site sticky," said Jesse.
"Maybe we're so close to our business that we
can't see the forest for the trees," said John. "Let's
get someone else to look at it."
They asked several friends to look at their site.
The answer surprised them. Most people said they
had the strong impression that John and Jesse
sold vision care, not eyeglasses.
One of their friends was a psychologist, who told John,
"The problem is in the perception you're creating.
You've tried to make your site sticky by giving a lot
of eye-related facts and pictures on your home
page. That leads people to the idea you are an
optometrist who sells glasses, not an eyewear
boutique. People see what they expect to see
based on their initial impressions. You're creating
the wrong first impression."
John told Jesse, "We've got to carefully control
WHAT is presented, WHEN it is presented, and
HOW it is presented on our site. By manipulating
those variables, we can not only create the right
impression of our store, but create the sort of
upscale image we want."
Jesse revised their site, focusing on their special
frames, personalized service, and partnership with
vision care professionals. And he used more
pictures of happy customers wearing their frames,
knowing that pictures can make a stronger
impression than words. When visitors started
getting the right impression of the business, they
started calling the store -- and they already had a
positive image in their mind.
LESSON: A person's initial perception of a Web
site helps to color every other idea and impression
they have. If you give the wrong impression on your homepage, you'll
lose or confuse many of
your visitors. Every element plays a part in
creating the overall image visitors have of your
business. The best home pages clearly show
visitors the benefits they can have in simple, direct
words and pictures which reflect the type of image
they want to present.
LUCIA and PHIL have a carpet cleaning business.
Their Web site details services and prices, and
shows pictures of their technician in action. While
they have visitors, few of them have contacted the
Lucia talked to a friend who understood human
motivation. Jenny explained to her, "Your industry
has a questionable image because of a few
disreputable companies, and that colors the
impression people bring to your Web site. What
they want you to give them is confidence that
"Most people haven't heard of us, so we're just so
many electrons on a screen to them," Lucia told
Phil. "We have to convince them we're one of the
"How?" asked Phil. "We already tell them all the
good services we provide, and we guarantee our
"Jenny says we need third party credibility to build
confidence in our visitors. We do that by getting
testimonials from some of our customers. And, we
especially try to get a testimonial from Mr. Johnson
at the bank because he is a highly credible
source," said Lucia.
"Why don't we emphasize how long we've been in
business, too? And that we're members of the
Chamber of Commerce," suggested Phil.
Lucia added the new information to their site, and
even included a picture of Mr. Johnson at his bank.
They not only got quotes from customers, but
actually reproduced a couple of the letters to add more credibility.
And they looked for other ways,
too, like displaying the Customer Care award from
a trade association they had won, and showing the
results of a survey they did with customers, who
gave them high rankings in several "Customer
The changes made a difference. More visitors
began calling the store, and many of them
mentioned Mr. Johnson's name or their Chamber
membership. It gave them confidence.
LESSON: People make buying decisions based
on both logic and emotion. Believing you build up
their confidence by simply telling them what you
sell can be a big mistake. Unless you or your
company already have credibility in their minds,
your customers will want to know what others think
about you -- your other customers, your peers, the
business community, and so on. This is especially
important on the Internet where a garage-based
business can create the same professional
storefront as a major corporation.
JAMIE AND OSCAR own a furniture store and
also sell home decorations online. Their high-end
stock isn't selling well despite foot traffic and Web
visitors. And they don't know why.
Jamie talked to a marketing psychologist friend
who explained their store image and Web site didn't fit
their pricing structure. The store has a very ordinary
appearance, but their stock is high quality and is
priced high accordingly. The same problems are seen
in their Web site.
The psychologist told them,
"All consumers want a fair price, but fairness is not
objective. It is subconsciously influenced by many unrelated
factors. The look of the store influences the buyer's expected
price range for your furniture. When its in the upper end of
that range, buyers look for value-added features to justify
what they perceive of as a high price. It is entirely possible to
create the impression of "low cost" or "high value" with little or
no change in the actual price you charge. In a fancy furniture
store your mid-priced recliners would be at the low end of the
range buyers expected to pay, and be seen as a bargain."
Jamie first upgraded the look of their Web site to
favorably compare with those of exclusive furniture and
department stores. They worked with an interior designer
to remake the look of their store that created an image of
high-quality in the minds of customers. And it worked.
Now they sell more online and offline, and do it without
lowering their prices.
LESSON: A fair price is in the mind of the beholder.
A $1.75 cup of coffee at IHOP seems high to most customers,
but at Starbucks its a good value. That change in judgment is
influenced by Starbucks's high-end image, expected price range
for its coffees, and the fact that plain coffee is the cheapest thing
on the menu. Be aware of all the unrelated factors that influence
buyers' perception of your product's price.
INFLUENCING PRICE PERCEPTION:
Here are some psychological influences on the buyer's
perception of an item's price which are not related to the
Price comparisons you use in the ad. ["Compare at $..."]
Appearance of the store or Web site, including layout
Display of the merchandise. Any gem placed on dark velvet in a glass case and lit well seems
to be of higher value than the same gem in a cardboard box.
Appearance and demeanor of the sales staff
An "On Sale" sign
Offered discounts ["20% Off"]
Setting a time limit for a price.
Using the words "Only" or "Just" in the ad. ["Only $39.95 for a limited time"]
Contrasting the price to a higher price for a similar item. For example, a $499 recliner seems more reasonable when it is sitting next to a $699 recliner.]
JUAN AND SYLVIA own a small fast food restaurant. Since
they are close to many businesses, they have a Web site where
customers can order ahead at lunch. But they're having trouble
competing with nearby chains despite their unique look.
"Our restaurant is beautiful," said Juan, looking over
their dining area. The crisp white tablecloths were warmly
colored by a series of small chandeliers, which made the real
wood walls gleam. "Why don't we have more customers?"
Sylvia asked a marketing psychologist about their problem.
"You advertise yourself as a fast food place, not a restaurant,"
he told Sylvia. "One problem you have is the public's image of
the fast food industry. They expect acceptable food fast and at a
reasonably low price. They expect to make a tradeoff for that --
they eat in a plastic, utilitarian setting. Your place doesn't
fit into their expectations.
"Looking at all the work you've done on the outside and inside of
your place may lead some people to expect higher prices.
I know your prices are competitive. That will lead others to
think the fancy setting will be balanced out by lower quality
food. In other words, you are a victim of your industry's image.
And it is very hard to change an industry's image.
It will probably cost you a lot of extra money to try to overcome that image."
Juan took off the tablecloths, painted the walls blue
and yellow, and replaced the chandeliers with inexpensive
lighting fixtures. The outside of their place now looks more like
competing franchise operations. Sylvia revamped the look of their
Web site to match the look of their restaurant, clean, attractive and
utilitarian. They have gradually built up their business. And more
than one customer has commented that the quality of the food
seems to have improved.
LESSON: You can't fight city hall. Your business is
influenced by your industry's image. While you can position
yourself at the lower, middle or upper end of that image, it is
hard to go beyond that. Its very difficult to create
the image of a high class operation if you're selling fast food,
aluminum siding, taxi services, used cars, used furniture, etc.
Instead, use that image to help sell your products.
Here's another story on this point . . .
DWAYNE'S DISCOUNT BARN: His store is as utilitarian
as a Sam's Club warehouse. To sell his jewelry, he doesn't
run full-color ads featuring models in Dior gowns. He uses
the image of his industry to influence his buyers' perceptions.
Dwayne's ad for diamonds reads:
Hi, Neighbor: We just got in a big shipment of fine quality diamond rings from
Spain, and your True Love can be wearing one on her pretty little finger tonight!
You can get her a real European Diamond at a price you won't believe!
We got 'em in all sizes to fit all budgets. We got 'em set in gold,
silver, platinum and clear plastic. Bring in your Honey and we'll
give you an ice cold Pepsi while you look around.
Your friend, Dwayne.
Dwayne sells more diamonds this way than he would with an
upscale ad, which would scare off the customers who will buy from
him, and would not attract those who refuse to buy a diamond from
any place that offers plastic settings. Dwayne's ad reinforces the
target buyers' belief that they can get good bargains from Discount stores.
Do your ads and Web site reinforce your customers' expectations?
JENNIFER AND PETER have a cleaning service. Their employees do a good job, but they've been losing business.
"What are we doing wrong, Jen?" asked Peter. "Customers say we aren't doing anything wrong, but they're switching."
"I don't think it is price," said Jennifer. "We're not the lowest, but we aren't the highest either."
"I'll ask over at Western International University, see if their marketing profs have any ideas," said Peter.
A week later Peter said to Jennifer, "Maybe this is the problem. One of the profs said buyer research shows that customers switch most services based on a couple of factors. The first is how good the service is, and the other is how good the 'quality of care' is."
"What's 'quality of care?' asked Jennifer.
"It means the way the service is provided. You know, like smiling and going that extra mile," said Peter.
"So we may be falling down on our 'quality of care'?"
"Right," said Peter. "The research found if either rating drops, customers are ripe to switch. But switching is more likely when the 'quality of care' drops than when the quality of service drops."
"That makes sense when you think about it. Remember that boutique I used to love? After that woman was rude to me, I'd never go in there again."
"So what do we do?" asked Peter.
"Let's beef up our service with quality care extras. We could offer some special cleaning services free to good customers, send regular Thank You notes with little gifts . . ."
"And we could do a quarterly written evaluation of the places we clean, pointing out developing problems we see with the carpet, bathrooms, and disposal areas."
"How about birthday cards? And holiday cards?"
"Wow. When you start throwing out ideas, there are a lot of cheap things we can do to make our customers feel special!"
LESSON: No matter what you sell, you sell to people. They're just like you. They want to feel special and appreciated for giving you the business. Little things go a long way to creating those emotions, and they pay off in greater brand loyalty. Start brainstorming. You'll be amazed at the good ideas you'll think of.
More on BRAND LOYALTY: It is influenced by more than Quality of Care. Research shows that customers make buying decisions on brands they've bought before based on:
(1) Performance Evaluation - how well does that kitchen cleaner or burger place do what you expect it to do? These are the Needs, Wants and Reduction of Fears motivations we've often discussed. If you aren't getting what you expect, you won't be loyal.
(2) Social and Emotional satisfaction -- Does buying the product or service make you feel good about yourself, and make you feel that others would feel good about you, too? A t-shirt may be well made, but if it says "K-Mart" in big letters on the front, chances are you won't buy it. On the other hand, a cheap t-shirt that says "Saks Fifth Avenue" will fly off the shelf at twice the price. Remember, we don't buy products or services. We buy satisfactions, including emotional nourishment and self-image.
(3) Habit -- the longer you've been buying a product, the greater the odds you'll buy it again, all things being equal. That's why it is important to do everything you can to make the buying experience for newer customers special (smiles, Thank You letters, little extras -- 'Here's a nice bone for your dog, Mrs. Jones'), and encourage them to buy again (coupons, good customer discounts, customer-only specials, etc.)
OLGA AND BEN have an alterations shop. They do fine work, but they aren't building referral customers as fast as they want.
"We ask our customers to tell their friends," said Ben. "What else can we do?"
Olga did some reading and found that creating customer satisfaction isn't as straight-forward as they thought.
"Aren't customers just satisfied when we do a good job?" asked Ben.
"No," said Olga. "Satisfaction is really a matter of comparison between expectations and reality."
"Say that we promise a suit alteration on Thursday. The customer comes in on Thursday, and there it is," said Olga.
"Right. We did what we promised. What's wrong with that?" asked Ben.
"Nothing. We set a level of customer expectation by promising the suit on Thursday, and met that expectation by having it ready. The customer is satisfied," said Olga. "But customers are MORE satisfied when their expectations are exceeded."
"What should we do?" asked Ben.
"We could promise the suit would be ready on Saturday, then call on Thursday and tell them it is ready."
"That's makes them think we're fast."
"Right. And we say that we did it early because they are a good customer, or a first-time customer, whatever."
"That makes them feel special." said Ben.
"Right. And it isn't just time. If our store looks high class and our prices are moderate, then people are more satisfied because they were expecting higher prices based on how our store looked to them. There are several ways we can influence a customer's psychological satisfaction without spending a lot of money or changing our scheduling."
"And the better they're satisfied, the more they'll tell their friends about us."
LESSON: Your marketing messages are promises of performance. Promise enough to get the business, then exceed those promises to get the repeat business. Try to create that 'pleasant surprise' in every customer.
SELMA AND BOB have a small automobile insurance agency that
writes policies for multiple insurance companies. They aren't doing
so well, and need a boost in both inquiries and sales.
"We advertise and send postcards to people in our area," said
Bob. "What else should be do?"
Selma talked to a marketing psychologist who told her, "Here's
one idea to increase both inquiries and sales. The bond of trust
between parents and children in their 20s is stronger than most
retailers suspect. In auto insurance, for example, 35-40% of young
men have the same insurance company as their fathers. For some
products, especially those young adults readily identify with, such
as music and films, the parental influence is minimal. But for many
others, from insurance to brand name toilet tissue, it really does
seem like 'father--or mother--knows best.'"
Bob smiled when Selma related this information. "Targeted
mail," he said. "We can get a list of all young men . . .
"And women," said Selma.
"And women living in our area, crossmatch them with customers of
insurance companies we write, and send each of them an invitation to
join the same insurance company as their parents."
"We can also send a letter to their parents giving them 10
Reasons Good Insurance Is Important For Young People, and suggest
they talk to their kids about it," said Selma.
"Yeah, like when Johnny brings home his laundry for mom to do,"
Their ideas worked. They received more inquiries from young
adults in the area, and even a couple of thank you notes from parents.
LESSON: Everyone is influenced by the opinions of others. Be
careful in assuming that just because kids have left the nest that
they are only influenced by peers. Eighteen years at home creates a
lot of trust and brand equity for many products and services.
More on . . . TWO-WAY INFLUENCE IN FAMILY PURCHASING DECISIONS:
Parent - Children influence is a two-way street. Behavioral
research shows that children influence the purchasing decisions of
parents, too. We're all familiar with the crying child in the
supermarket who demands a cereal with a favorite cartoon character on
Smart marketers who sell children's products always do a dual
analysis of their target market -- one to identify the underlying
buying motivations (needs, wants, fears, desires) of the child who
consumes, and a separate one for the mother who pays. Dual
motivation analysis allows marketers to focus on the most persuasive
logical and emotional advertising messages for both the buyer and the user.
When both will see the same message, such as on packaging, dual
motivation analysis allows the marketer to combine messages, often
using visuals for children (such as Go-Gurt's cool kids on
skateboards) and text for moms (the text on Go-Gurt's box emphasizes
its nutritional value and portability.)
But children have greater buying influences on parents. For
example, if parents believe their teens have more knowledge about a
product, such as a computer or MP3 player, the teen's influence on
the buying decision increases.
If parents believe the productcategory has more relative importance to their children,
such as the choice of a college or prom dress, their influence is greater.
Children also play a larger role in the initiation stage ("Let's
consider buying this") of new purchases than in the decision stage.
When children see an ad for a new toy or food on a Saturday morning
show, for example, they can initiate an awareness and consideration
process that would otherwise not have happened.
EXTRA LESSON: If you sell something used by children or teens,
consider a two-pronged marketing strategy which targets the specific,
separate, buying motivations of users and purchasers. This is
especially true for new products or services where the influence of
children on initial consideration is especially strong.
JOSE AND JANICE have an office equipment business. Sales were
strong when they focused on selling low cost copiers and fax machines
to small business owners. Now they've expanded into higher-priced
equipment, and that forces them to target larger companies. So far
results have been poor.
"We offer name-brand equipment at really low prices," said Jose.
"What are we doing wrong?"
Janice talked to a business friend who gave her some articles
on psychological marketing.
"It says here," Janice reported, "that we have to overcome a
lot more stress in bigger companies to make the sale."
"Stress?" said Jose. "From what?"
"Bigger companies buying more expensive equipment bring more
people into the decision-making process. They're from different
departments, and maybe some are more senior than others," said
Janice. "We're used to a store owner and a secretary making the
decision. More people mean more stress in the whole process."
"What does that mean?" asked Jose.
Janice replied, "It means that everyone is sweating making a bad decision
because these machines cost a lot of money. They're worried that a
bad decision will make them look bad to their boss and to the people
in other departments who maybe didn't agree with them."
"Sure," said Jose. "And everyone probably has a little different take on the
purchase depending on their department, like finance versus
"Decisions also get made a higher levels, so one set of people
make recommendations, but others decide what to buy," said Janice.
"That means more conflict among the recommenders, who all want
to look good, and more fear among the deciders, who have to figure
out which recommendation to trust," said Jose.
"Right. And the higher the decider's position, the more can be
at stake in his or her career," added Janice, "just like the
questions on that 'Who Wants To Be a Millionaire' show."
"So price is not the key issue here. It's confidence. And that
means an emphasis on brand names, track record, testimonials,
after-sales service, and a strong guarantee," said Jose."
"These marketing psychology articles say we've got to have a
good idea of all the hidden buying motivations at work, especially
the emotional ones like fears and desires," offered Janice.
"Research," said Jose. "We know some of the people in the
companies we want to sell. Others we can ask about, or just make an
educated estimate of their key motivations, based on their department
and job responsibility."
"Right, like increasing sales, boosting efficiency ratings, or
finding ways to trim costs. And always 'job protection.'"
Janice and Jose revised their marketing materials and sales
pitch to address the various buying motivations (needs, wants,
fear and desires) at play in each company, and tried to provide
information that would reduce stress, such as testimonials and a
strong guarantee for performance and service.
It is still an uphill struggle for them, but they've been
receiving some positive feedback, so Janice and Jose know they're on
the right track with their psychological marketing approach.
LESSON: You don't sell to companies. You sell to people.
Every person in the decision chain wears two hats -- corporate and
Their final decision is a balancing act between "What's good for
the company" and "What's good for my career?" For the best results,
identify and use both sets of motivations in your marketing messages
and sales pitch. Never forget the importance of 'fear' in any
BLYTHE AND MURRAY have a furniture store in a good part of town
which they purchased from the founder, who was retiring. In the last
eightmonths they've seen business decline and few repeat customers.
"What are we doing wrong?" asked Murray. "It's the same
store, same location, same employees, same stock, but sales are down
20%. What are we overlooking?"
"Something is sure a problem. Traffic has fallen off, too,"
said Blythe. "Do you think something is upsetting our customers?"
"Like what?" asked Murray, sniffing the air. "It smells OK in
here, the lighting is fine, and we've even got nice music playing.
Your idea about the snacks was a good one, too."
"I'll ask a friend about this," said Blythe. "He's a
marketing psychologist. He should know."
The next day Blythe talked to her friend, and came back to
Murray with a serious look on her face. "He suggests that we might
have an employee problem we don't know about," said Blythe.
"But they're the same employees that Ralph had," said Murray.
"Yes, but they're not working for Ralph any longer. Let's do
what my friend suggests and see."
"Let's take a test."
Blythe pulled out a single sheet of paper with ten questions
on it. "We've got to answer these honestly," she said. "No
fudging." Then she handed the test to Murray and they began. This is
the test they took.
THE CUSTOMER SERVICE QUIZ: (choice = points. Add up your points.)
1) Do you spend time face-to-face with customers asking their
opinions about your business operations, products and services?
(This means more than saying, "How's our service?" as they're
leaving!) Never = 0 Up to 5 customers/year = 1
Up to 15/year = 2 Over 15/year = 3
2) Do you ask customers what new products or services they would like?
No = 0 Yes = 1
3) Do employees from your purchasing and product development
departments meet with customers to hear their opinions?
No = 0 Yes = 1 Formal customer advisory panel = 2
4) Do you collect survey data on customer satisfaction and share the
results with all departments? (Remember, everybody ultimately works
for your customers!)
No = 0 Yes = 1
5) Do the real needs and satisfactions of your customers play an
important role in your business plan and decisionmaking process? (If
money nearly always trumps customer service in your business, you
don't get a point!) No = 0 Yes = 1
6) If a customer has a legitimate problem or complaint, do you 'go
the extra mile' to make him/her feel good about your company, or just
fix the problem? (It's the difference between "Sorry the hem is
torn, just get another and we'll exchange it." and "Sorry the hem is
torn, let me get you another one, and here's a 20% off coupon for
your inconvenience.") Fix the problem = 0 Do more = 1
7) Do all employees dealing with the public receive extra
compensation for outstanding customer service? (Recognition is nice,
but its money that counts!) No = 0 Yes = 1
8) Honestly, does your sales staff think of customers as (a)
individual human beings to be helped, or (b) cattle to process?
Cattle = 0 People = 1
9) Do most customers return to buy from you again or refer others to
you? No = 0 Yes = 1
10) Is it your operational policy that customers are nearly always
right, even when they aren't? No = 0 Yes = 1
"So, how'd we do?" asked Murray.
Blythe added up the score and read the scoring rules. "It says
that if we score below 6, we've got some real customer service
problems to solve that will likely require an attitude overhaul and
employee retraining. 6 - 8 is fair to good customer service. 9 and
above makes us a model for others."
"And we got what?" asked Murray.
"A two. And I'm not even sure our employees really think
customers are people."
"So we need to start doing some of the steps the quiz suggests."
They began by talking to customers that came into the store and those
in Ralph's card file. Sure enough, the employees had slacked off
with the new, looser management style of Bythe and Murray, which made
customers feel unappreciated.
After six months of customer service retraining, monitoring, and
constant customer evaluations, the store is doing better than ever.
Blythe and Murray have even set up a Web site. And the first thing
they told their Web designer was, "This site had better be the
friendliest one on the entire Web! We want our visitors to feel like
we care about them when they visit our site."
LESSON: Follow the Golden Rule - treat people like you want to be
treated. Do you follow the Golden Rule? This quiz may have given you
a hint, but you can't really know unless you regularly ask the most
important person for your business success - your customer.
SAM AND RICARDO own a small paper products company. Their goal
is to develop a strong retail market for recycled paper products,
especially through Web site sales. It hasn't been working out as
"What's the problem?" asked Sam. "Our recycled products are
competitively priced, even with shipping costs. But there are so
many other green-focused paper companies out there, its hard to make
"But people are as concerned about the environment as ever,
maybe more so now," said Ricardo. "What can we do to sell more?"
Sam talked to a friend who knew about buyer psychology, since buying
first happens in the customer's mind.
Sam's friend looked at the marketing materials of Sam's company
and its competitors, then pointed out a positioning solution.
"Your e-mail marketing letter tells people about your recycled
products, but not why to buy them from you," said his friend.
"But we say its recycled paper and that it will save trees.
What else can we do?" asked Sam.
"Research shows that people are more likely to buy a product or
service from a company which they have something ideologically in
common with," said his friend. "In other words, they want to know
that you think alike about critical issues, like the environment."
"You mean separate from our paper?" asked Sam.
"Right. If you like someone, you're more likely to pick them
over their competitors to do business with. And we tend to like
people who think like us."
Sam tried this out on Ricardo, who immediately understood the
idea. "That is so very true in Mexico," he said. "Why didn't I
think about it sooner!"
"So what do we do?" asked Sam.
"We become more than a paper company to them, we become people,"
Ricardo wrote a new e-mail letter that not only described their
products, but emphasized the company's beliefs and actions in
protecting the environment from polluters and clear-cutting timber
"This letter makes me proud of what we've done and what we're
trying to do," said Sam.
"It helps customers to see us as people like them, not just a
company selling recycled paper," said Ricardo.
The letter worked better than they hoped. Not only did people
order paper, they asked Sam and Ricardo about ways they could help
protect the environment in their areas. This led to a chatty
newsletter about green resources and ideas tried in other places.
Not only were Sam and Ricardo doing good work and selling paper, they
were building up a loyal customer base and creating word-of-mouth
advertising that would keep them growing for years.
LESSON: If you can narrowly define customer niches in which
members share common beliefs or viewpoints, look for ways to show them you
share some of those beliefs. Also look for ways to demonstrate your commitment
through your product or service.
For example, Ben & Jerry's Ice Cream is popular with
environmentalists not only because of its great taste and funky
product names, but because the company gave money to save the Amazon
rainforest, and now uses a new packaging technique which reduces toxic
water pollution. In short, people feel good about buying Ben & Jerry's Ice Cream.
BONUS INFORMATION: THE PSYCHOLOGY OF PRICING:
Pricing is tricky, and many books have been written about it which are worth reviewing.
Here is one point to remember: Price has nothing to do with your product, and everything
to do with the buyer's perception of your product. You can prove it to yourself.
Imagine a beautiful, dark-green glazed vase. It has a discrete
price tag on it of $100. While a buyer's evaluation of the fairness
of that price has something to do with the features of the vase (shape, quality
of glazing, etc.), it is also influenced by extraneous factors.
Imagine the vase sitting on a low metal shelf in the Housewares
section of K-Mart, along with two dozen identical vases. Would a
shopper think the $100 price was fair? Not likely.
Now imagine the same vase on a glass shelf at eye-level
in the Home Decoration section of Macy's. Now how fair would it
seem? Maybe a little pricey, but the buyer would be willing to be
convinced of its worth.
Now imagine the same vase in the fine crystal section of Saks Fifth Avenue,
sitting on a velvet cloth atop a stone pedestal and covered by a glass case.
Now how fair does the price seem? If its displayed like that in Saks, it must be valuable,
so $100 may actually seem like a bargain! The vase didn't change, just its display and environment.
LESSON: "Don't ignore all of the factors extraneous to
your product or service which influence the buyer's perception of its
value. By changing those factors, sometimes at little cost, you can make your
product seem cheaper or more valuable than it is currently priced."