In my last two columns I’ve outlined why independent retailers are declining while the boxes and chains are growing, and why your digital marketing will not reverse this trend. One reason is because everyone is using digital media to shout the same, copy-cat message: “Here’s our name, here’s what we sell, here’s how to find us.” In a head-to-head match with billion-dollar corporations who can outspend you 100-1, you’ll never win the customer-acquisition game using this approach.
Let’s look at one of several alternative approaches where you can win the customer-acquisition game against the big boys by reviewing a concept I’ve covered numerous times before:
Know the three tiers of marketing. Tier 1 is any marketing to your “warm” market. This includes: communicating directly with past clients (your house list); marketing to generate referrals; creating referral partnerships with aligned businesses (realtors, designers, re- modelers, etc.); and your selling system. Tier 2 is any marketing to strangers, including Google ads, SEO, ad retargeting, social media, etc. Tier 3 is broadcast advertising, i.e., ra- dio, TV and billboards, to large geographic regions.
Dealer X (featured in my last column) got her Tier 1 strategies implemented first. Only then did she begin to test specific Tier 2 strategies, keeping the ones that work and discarding the others. Only after she has fully exploited Tier 1 and 2 and reached at least $10 million in revenue will she even consider implementing Tier 3. She knows her competitors will totally ignore Tier 1, while dumping their entire ad budget chasing strangers with Tiers 2 and 3. And this gives her a massive competitive advantage. Let’s look at why.
Dealer X knows that the worst leads come from her Tier 2 and 3 efforts. If she gets a lead from a Google ad, or because someone found her site while shopping online—or because they saw a social media ad—this person is a total stranger. There’s no relationship. She’s starting from zero in terms of earning trust. They are far more skeptical, stand-offish and price-sensitive than Tier 1 leads. She’ll still take leads from the other tiers, in fact she pays for some Tier 2 advertising in order to generate them, but she has no illusions about their quality. They’re a lot more expensive to generate than Tier 1 and require much more energy to close.
Dealer X realized that if on a Monday she had 10 walk-ins generated by Google ads, and
on Tuesday she had 10 walk-ins who were repeat and referred clients, that Tuesday would have more closed sales, higher margins, less shopping around and just an overall better experience than Monday. She realized that when she dealt with repeat and referred clients that she didn’t really have to sell at all. They saw her as a trusted advisor, like a family doctor, and were really there just to get her guidance. The sale was usually a foregone conclusion.
Another thing Dealer X realized is that her Tier 1 marketing multiplied the effectiveness of all her Tier 2 efforts. As a result, she is dominating her competitors—those who grumble and complain about how “unfair” it is that some dealers get all the breaks while they struggle just to get by.
Jim is the founder and president of Flooring Success Systems, a company that provides floor dealers with marketing services and coaching to help them attract quality customers, close more sales, get higher margins and work the hours they choose. For information, visit FlooringSuccessSystems.com.
