The Shrinking Middle Class and You
We know statistically that the middle class in terms of spendable income is shrinking and shrinking quickly. I don’t want to get into the politics of why it’s happening, the important thing for you to know is that it’s happening.
Where are they going you may be asking? Twenty five percent of them are moving up, most are moving down. This is important for you to keep your eye on and for you to consider when making decisions about your business.
Here are 3 principles of direct marketing for you to apply for gaining a bigger share of the consumers moving up or who are already there. We all know that for years Apple has had an almost hypnotic hold on consumers, especially high end consumers; image if you had that same effect on your clients and/or prospects.
Your product or service may be a better fit for those moving down or already going there – we are seeing companies who cater to that demographics growing! Something you should know already or want to figure out, or something you want to give consideration to.
Find ways to apply all three principles in your business, and Apple-like success will surely follow.
- Sell at the High-End: Always be looking for ways to attract more affluent customers that you can turn into clients. Most Apple computers start where Windows machines peak. Fans of both will argue which is superior, but recent sales suggest that no one doubts the value of the higher-priced Macs. Premium prices need to be matched by a differentiated, premium product, but that’s not the point here. Having prices higher than your competitors allows you to pay more for the customer through marketing. Once achieved it also insulates you from price wars.
- Be willing to make an investment in marketing your business: This relates to “paying more for your customers.” The shops that seem to continue to struggle year after year are the same ones looking for the cheapest way to advertise. These are the same people who complain that all they ever get from their ads are the price shoppers. Investing in the right marketing is the best investment in your business you can make. It doesn’t matter how great you are at fixing cars if you don’t have enough to fix so that you can pay your bills. It doesn’t matter how great the equipment and people are if they don’t have the car count to utilize their talents. If you’re willing to invest a little more to get better quality clients, many of your challenges begin to fade. Ultimately you may need to invest in the right person to help you utilize the marketing for the maximum return! And no, I’m not telling you to throw good money after bad and just advertise more; do it wisely. If you’re not sure how, get a person with proven experience to help you.
- Lifetime Value of a Customer: Once you know this number, your decisions regarding #2 become a lot simpler. At my live events I usually go over how to calculate the lifetime value of a client, even using a low average for the example. Every time someone sees the numbers for the first time they’re stunned. It’s easier to justify making a little more of an investment in getting and keeping a quality customer.
The number of businesses closing their doors is astounding. Even worse is the number that are struggling and/or barely able to keep their heads above water, putting in a ton of hours, depriving their families of… Most all of it can be fixed with good marketing; even if you don’t know how to market properly, make the investment and get help doing it.
The old saying still holds true: if you keep doing what you’ve always done, you’ll continue to get what you’ve always gotten.
Quit blaming the economy and the weather and… Take control and make the decision to be a business owner instead of letting it own you!