Learn from what the big players DO badly

Avoid the tricks and traps of big players (Image: illustir via Flickr)Old-style marketing was full of tricks.

Systems would be set into place to ‘fool’ customers or ‘trap’ them into buying.

Even today, you friendly, shiny supermarket continues the practice of putting ‘destination category’ items deep into the store to force you to walk past a plethora of ‘impulse’ and ‘luxury’ items. Ever see milk at the front counter?

Unfortunately, some small business owners come from that background or borrow from those techniques because they believe that is ‘how you do business’.

While it is often hard for consumers to change habits to punish big, big, well-entrenched chains (Pete Davies from Mix104.9 used a topic of the day recently based on him buying a potato from Woolworths which was rotten inside. However, I bet he still ‘pops in’ to buy potatoes there because it is convenient), the danger for small business owners is that it is often easier for consumers to punish them for poor product or service.

Here are three examples of how NOT to run your business and how Social Networking might be harnessed instead.

The mega chain

Amazon is a worldwide company that just about everybody is familiar with. It has built a sterling reputation for customer service – from providing transparent customer reviews of the books, CDs, movies, etc, that it sells, it clearly explains its shipping policies and it DELIVERS, and if you ever have a problem you can arrange refunds online. If the returns period has expired, you can still often click a button, enter your number and they will call you back immediately.

However, they have bought a company called Audible. Audible sells downloads of audio books. In my opinion, Audible has always had sales systems that are, at best, clumsy and, at worst, mean and tricky.

I have twice now claimed a ‘free’ audio book. The first time was before Amazon owned the company and to get the ‘free’ audio book I had to pay a small fee for something (I cannot recall what) AND hand over my credit card details (the old school book clubs and record clubs use to use this ploy). However, when you try to cancel before your monthly billings begin, you must phone them in America, during their business hours, no matter which country you live in around the world. This non-consumer-friendly process is still in place even now they are owned by one of the technological world leaders. This says to me the policy is about making it as hard as possible for consumers to leave. The trouble with this shortsighted policy is that I have tweeted about my angst to warn others for falling victim to this ‘suck them in’ marketing policy.

Here is a tip, though, if you click to leave you are offered two levels of discount on your monthly subscriptions so if you ever want to stay with audible, I suggest you click through to leave and accept one of those offers. Of course, this also galls me. If they can offer their service for that discount when we are leaving, why cannot they offer it at that price to genuine, happy customers? That would make me feel cheap and exploited if I ever found out I was being ripped off for being a meek and mild, trusting customer.

From a small business owner’s perspective, I urge you NOT to follow the Audible pathway. If customers want to go elsewhere, let them. Nobody wins from being trapped. Even Sting, the pop sensation who one sang ‘every breath you take I’ll be watching you’ soon changed his tune to embrace the more positive and mature disposition of ‘if you love somebody set them free’! The customers who love you and accept your occasional ‘wobbles’ are the customers who are worth gold, directly through their fees and indirectly through their recommendations to friends.

If you currently use ‘traps’ for your customers, consider removing them. While you might lose some customers, you will also be losing a great gushing of poison about your company that the ‘trapped’ customers would have been pouring into anybody’s ears they could.

The car yard

Down in Gawler in South Australia, I recently heard of a well known car yard that advertised a position for sales person. This small dealership prides itself on being local and being family run, etc.

I was shocked to discover that its way of sending rejection letters to unsuccessful candidates was a blank email with an unsigned attachment.

This is shortsighted in the utmost. Surely every single car salesperson, just like every single insurance salesperson, now in 2011 must understand deep within their bones that every person they interact with could be a potential customer!

Not only does their inhumane way of letting people down smack of self-centredness and laziness, it also signals to the world their technical inaptitude. When services like Mailchimp exist which could have sent a personally-addressed email to each candidate for free, there is no excuse for this sloppy and coldhearted approach.

I am not saying you advertise fake positions to build your database but here is an idea: Imagine offering a special offer (discount or upgrade) to every unsuccessful candidate as a way of saying thank you for applying. Let’s think about this: they were people, many probably in the local region, who have an affinity for cars and an openness for working for the company and, by association, the car brands that dealership deals in. The worst that could happen is that this pool of human beings with sales blood in their veins (interpret this as ‘active mouths happy to share stories at bbqs, gatherings, anywhere there are ears) would have reach closure on that application with a positive taste in their mouth and something to talk about with friends and family. At best, they could have MOVED PRODUCT.

Can you see the difference? One approach is to treat job seekers as a painful necessity in life. The other is to see everyone as human and as potential customers – in small business you must always be ON and ALERT. It is not hard, it is just a mindset.

The home improvement company

My final example of what not to do is the stupid and dangerous ploy of placing financial penalties on job quotes.

We recently were in the market for a new pergola. We had three quotes.

Australian Outdoor Living was chosen and they gave us 14 days to decide. We then contacted some family members in the building industry to double check the quality of the goods outlined in the quote and get their feedback on the price. That took two weeks so on the 14th day my wife called back to say they got the job.

She was dumbfounded when the salesperson said that unfortunately the deal had to be signed off today, which won’t happen now, so the price needs to go up by $600. When she relayed that to me and I said they just lost the job, she was then told that maybe the price would only need to go up by $250.

Let’s just think about this for a moment. That company paid for someone to spend a couple of hours travelling to our house, talking and measuring, then developing a quote, only to play silly games and lose the business. I know they have a whole lot of systems and talk of television discounts and signage discounts, etc, and I know companies need to protect themselves from someone wanting a price honoured that is a year old. But trust in such a company not only goes through the floor after an experience like this, it also becomes a mission to make sure you protect friends and family from dealing with them. There is no way goods and services suddenly jumped in price because an arbitrary deadline was crossed.

Ironically, their quality control people rang a couple weeks later, to get an opnion on their sales person. Was he okay? Did he do something wrong? Luckily I took the called and was able to explain in marketing terms that it was nothing to do with the salesperson, only the ridiculous dicounts/sales systems being used. I am not sure if she understood what I was saying because without drawing breath she then asked if I’d like someone to come out and measure for cafe awnings when the pergola was finished.

Thankfully it is being built by someone else this week.

Do you use cliched discount systems to trick and trap people? Can you look someone in the eye and tell them that your price is your price?

As small business people, our advantage over corporates is that we can spin on a dime and take a new direction without ten years of meetings and policy development.

We also hurt faster if we annoy too many people.

Finally, in this age of socially connected consumers, the payback will come faster and harder if and when we get caught out trying to be too tricky for our own good.

Some closing thoughts

By all means, leave yourself the ability to modify pricing but in 2011 we must explain (or be able to explain) to our customers what is the reason for the modification.

If we can offer a discount, don’t just pluck some fanciful notion out of thin air, make sure your reason is based on a reason – scales of economy, a chance buy at a better price, a supplier rebate is available, etc.

If we must increase prices, make sure you can bring your customers along too, eg, our accounting review actually revealed our pricing had been too low for too long and if we didn’t move now we would not have been around much longer to keep servicing you, our freight suppliers just increased their prices to us and we have no ability to absorb them so we are unfortunately having to pass them on, etc.

Most of us consumers can tell BS from fact and we not only appreciate straight-talking honesty, we tell the world about it.

The Social Networking phenomenon can be friend or foe and YOU have much more control over that than you might think.

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