By Theresa and Jack Reaume
I was having a conversation with our oldest son the other day and discussing his career. Both he and our daughter-in-law are medical professionals with half a dozen degrees between the two of them. Now that they are in their early thirties, he is telling me about opportunities that are being presented to them. I asked him if ten years ago he saw these opportunities on the path they would follow. “No,” he replied simply. I told him, “If you create the proper foundation in your life, there is no need to worry about the future. It will take care of itself.”
But isn’t that true about most things in life? Whether it’s a building or a marriage, a career or a family, building a strong foundation sets the stage for what follows. The future will present itself and opportunities will appear as a result of your preparation and the foundation you build. And it’s no different in business. Your business and my business are only as strong as the foundation we build.
To borrow from our friends in the business schools, the 3 P’s – People, Product and Process are the fundamental elements of a successful business. But the underlying strength of each of these comes from the foundation on which they are built.
The ”People” part is pretty straightforward. You need the right people to make any business succeed: folks who are talented, hard-working, enthusiastic and dedicated. On Day One, right through to end of Year 50, if you keep reinforcing this foundation of your business, you are well on your way down the road to success.
When it comes to “Product”, better is, well, better. Assess the market, assess your competitors and do it better. Not just at the beginning, but year after year, strive to provide a better product. Be innovative and take a few chances, with the ultimate goal being to consistently provide the best product in your marketplace. Constantly improving and improvising the foundation of your Product will keep you ahead of your competitors and viewed as an expert in the eyes of your customers.
The third “P”, Process, is sometimes the most challenging part of the success formula. It involves the processes that are in place with respect to manufacturing and delivering the product, processes for billing and collecting receivables, processes for training and managing staff, processes for managing, planning and budgeting, processes for advertising and marketing. All of these categories are equally important and together they form the “Process” foundation of a successful business. But we’re going to focus on the processes for your marketing decisions.
Everyone realizes that there needs to be a strict process in place for the financial accounting of your business. If not, those nice tax folks from the government will come looking for you. But marketing and advertising is a grey area to most people. A business must advertise itself, selling both its products and its brand. But what processes do you have in place to measure success? Most people do understand the importance of a having a budget, but it’s equally important to have a process in place to determine where and why funds are allocated.
Marketing dollars need to be spent in 2 different areas: Acquiring new customers and equally important, securing the relationship you have with your existing customers to make sure they return.
Part of every marketing budget needs to be spent on your existing customers. They represent future business. They came to you once and if treated well, they will come again. All you have to do is stay touch, demonstrate your appreciation and make them feel like they are a part of your business family. Fortunately, as a process this is simple, easily understandable and verifiable. Set up a program to communicate with them on a regular basis. Demonstrate your appreciation. Personalize, personalize, and personalize. And as a part of the process, give them a call. These are people you know. In most cases, they will be more than happy to provide you with feedback. These are marketing dollars that have impact and can be measured because of your existing relationship through referrals and repeat business.
Spending money on acquiring new customers is where the waters get murky. There are lots of places to spend your money, but it’s more difficult to measure the efficiency of those dollars. You need to have a process in place to come to some objective conclusions. Have a result in mind before you commit these marketing dollars. What are we trying to achieve and how will we measure the result? With a proper process in place, you will be able to come to a consensus regarding the effectiveness of your spending.
Whether it’s building a building or a bridge, a marriage or a friendship, a career or a business, constant improvement to the foundation that supports it will help guarantee your success. FBA