How to Create Business Equity and Competitive Advantage with Lists
There are a ton of spectacularly dumb business operators, and I find my encounters with them depressing. You should really be thankful you are here, helping you not be one of them. I’m serious. You are about to learn something few business owners ever learn:
There is little real equity and no security in the assets bankers look at on balance sheets and that most business owners prize, like patents and other intellectual property, proprietary products, services, location, buildings, equipment, or inventory—because it’s all worthless without customers and customers in development. The true equity is in these lists.
Further, most business owners live with utter uncertainty and insecurity day by day, only presuming or hoping people will arrive and buy, but as the financial people constantly caution: past gains are NOT predictive of future results. To be in control, to be in what I call The Income at Will Position, you must have well-kept, ready-to-use lists including email and physical address.
Any business not Always List Building is failing.
Failing to convert traffic, visitors, first-time buyers to an asset. Failing to exert competitive advantage over other businesses in their category and community that might also be chosen randomly, day to day.
As example . . .
Carla and I went for dinner at the giant, warehouse-sized Granite City Brewery, really a burger joint, at an upscale shopping center . . . on a Monday night. The place was nearly empty. Were it mine, I’d be panicked. Sure, it’s a Monday, but it is Monday Night Football night and there’s a big bar with big TV’s. The Cheesecake Factory across the way had a full parking lot. Yet we were able to get in and out of Granite City with no attempt of any kind made to capture any contact information, even just email. No bounce-back coupon with expiration date gifted. No call-ahead menu sent home. Nothing. What they don’t grasp is: we were (just) leads. What they did: being there, being open, big-ass sign, and not having a waiting line like Cheesecake Factory was their version of lead generation. It got us to eschew Cheesecake Factory, our first choice, and try them. Audition them. Gift them permission to sell, to convert us to repeat customers and advocates. But they did none of that. And obviously, no follow-up after the fact, because the imbeciles can’t. So, it’s nice to be with you smarter folk. But as a reminder, it’s useful to understand what a “lead” is in your business.
Leads go onto lists, to then be customers in development. Such lists contain money, like cactuses contain water. The ignorant can’t see water rising out of the cactus as if it were a fountain, so they may die of dehydration right next to one.
The most basic act of the owner of a direct marketing business is to Always List Build. At every opportunity. By every means available. This is vital if you are to convert your nondirect-marketing business to a direct-marketing business. The restaurant owner with a restaurant at a location has nothing but a restaurant. The restaurant owner with lists of frequent customers, first-time customers, prospects who visit his site or call but don’t come in; birthdays or birthday months, and wedding anniversary months of customers . . . has a direct-marketing business, and he has the ability to trigger Income At Will and to exert great control over stimulating sales.
The use of sales/marketing funnels described in the previous chapter is not just for active, short-term selling, but also for list building. As people enter and are permitted and encouraged to move through a funnel, email contact information, then full physical address contact information for use with real mail, then data about them obtained by surveys and choices of content opted into, auto-collection built into the sites should be harvested, then used to build lists. Plural. Segmented in various ways, whether by known key interest, birthday month, married/single, gender, any factor you might make use of. If all you use a funnel for is to sell, you neglect its best virtue: list building. The same thing is true of any media: people visiting your booth at a trade or consumer show; walking in and out of your brick and mortar store, “just looking around”; calling and asking a question of your receptionist. ALWAYS List Build. Let there never be a contact without an attached attempt to List Build. If you go back to the very front of this book and reread Becky Auer’s report on her wildly successful restaurant business, she reveals the important competitive advantage of the sizable list she developed.
That’s basic. You can get more sophisticated. If you want to know how to 2X, 4X, or 10X your lead-generation effectiveness, GKIC Member Rachel Young provides a good example. She has a gun store made unique by offering customers the opportunity to create customized firearms, but even more important, doing micro, precision target marketing based on their best customer profiles (Jeep owners, for example). She targets various market segments with success. For example, she focuses on a grossly underserved yet robust group of gun buyers: the LGBTQ community. As she explained, members of the LGBTQ community often face increased violence, especially those in the transgender population. Many of her LGBTQ customers feel especially vulnerable in the South (where her store is), and, statistically, a big percentage of them are gun owners. They have media, there are lists, and they can be specifically invited and welcomed. By getting an understanding of their needs, getting their vocabulary to speak to them as a knowledgeable friend, etc., she enjoys blockbuster success attracting them as prospective customers into the store.
The reason this strategy can result in 2X to 10X lead generation/new customer attraction effectiveness and (financial) efficiency is: precision Message-to-(Micro)-Market Match. Lists are the chief opportunity to use such Match. The more in-common factors known about a list or a segment of it, the better you can tailor and target a special message of high interest to those people in place of a sloppy one-message-forall approach.