What is a sale?
A Sale is the result of an intersection between desire, ability, trust and opportunity. A person has a desire for an outcome, they have the means and the ability to be in the location where the item is. They trust the vendor to be able to meet their expectations. Then there is a sale. Our Sales and Marketing tools (S&M, hmmm…) address one or more of those areas. First we need to know our customer. Consider two farmers markets we went to last year.
At Market A we have essentially have a midwest market – blue collar, small town, some rural rustics. At that market we have to explain what a crêpe is about one third of the time. At Market B the demographic includes singles, middle management, urban youngsters. At that market everyone knows what a crêpe is. The sales cycle is much easier. Our sales are better. Our strategy is different.
You can find out some of this info in advance, for free. The website city-data.com and the US Census have valuable information for you. A company called Claritas will provide a simple level of FREE demographic information by zip code.
Round Up the Usual Suspects
One way to find your customers seeing them moving through the sales cycle. Some sales methods describe a funnel, some use different terminology, there are many variations on this theme. We’ll use a dartboard on the wall of our local tavern. Let’s assume the wall, including the dartboard, is every potential buyer Those are the ‘Suspects’ – potential buyers (in theory everyone is a customer). Unless you are Coca Cola, too big to market too. A smaller group, selected from the Suspects, is the dartboard. The dartboard represents All Prospects – a subset of all Suspects. The rings of the dartboard winnow All Prospects down into Qualified Prospects by selecting by geography, income level, time of day, food preferences. The Center represents a Customer – a sale. This is sometimes called Targeted Marketing. All of your efforts in sales and marketing, from signage to your receipts are to move the human population down this path Suspect=>Prospect=>Qualified Prospect=>Customer
Two important observations — the closer to the center of the target, the cheaper your marketing costs are to close a sale. The closer to the target, the smaller your audience so the fewer people can make a decision to buy and move from Qualified Prospect to Customer. Effective marketing is to strike a useful balance. Qualified customer is important because you do not want to waste your precious resources on people that will not become customers. This is the quandary about Groupon and other deep discount promotions. Yes, they do increase your brand’s awareness among Suspects, turning them into Prospects. But if they are NOT Qualified Prospects, they will not buy or they will only be cherry pickers and not return. More about coupon and discounting later.
So the purpose of sales, advertising and marketing is to take what you know about your target customer, extract them out of the Suspects, and move them down the path towards becoming a customer. So in knowing your target customer you can find out what appeals to them, – location, price, preferences, and convert prospects into customers.
The process of turning suspects into customers is critical. It drives so many choices, such as locations. For example, by having a Food Court in a mall, the Property owner has performed the valuable service of selecting out qualified prospects – The people in the food court are self-qualified – so a big part of the cost of advertising (luring people to your storefront) has already been done. Those kinds of cost factors are important to consider when looking at locations. This is one of the reason we like making crêpes at Farmers Markets. The Market itself is crowdsourcing customers. Yes there are other food vendors but if they don’t buy a crêpe this week, they’ve seen us (free advertising exposure) and they may buy next week.
Next we’ll talk about products and pricing.