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Business Management

Low-cost, High-return Promotion

Offer your customers some great reading material and watch them return to your store.

by Tom Shay

When this writer was a retailer, he fully understood the story told of Wanamaker department store. It was said that John Wanamaker told of his advertising experience, "I know that half of my advertising does not work. I just don't know which half it is." This was my experience with advertising as well. The biggest response I ever saw to any effort to reach customers was when we noticed that as we sent statements to our customers each month, we usually were sending out about 150. The problem was that 300 people had charge accounts. So, where were the missing 150 customers? One month, we triggered the computer to print statements for all 300 accounts. For the 150 with a zero balance, we hand wrote this note on the statement and mailed it to them: "You owe us nothing. We wish you did. Please come see us." Lots of folks came in to tell us they had received the note. We took this as proof of another old business adage, the one that says it will cost you $20 to get a new customer, but only $4 to get one to return. We soon began to include coupons for a free giveaway with the 300 statements we were now sending out each month. And we continued to see a good response. Some months the response was as high as 40 percent. Clearly, then, what we needed were more names and addresses of customers. Over the next couple of years, we collected an additional 2,300. Each month we sent them something. Our handwritten notes and coupons grew to become a monthly four- to eight-page newsletter. The idea worked well and we continued to experience a strong response. ELECTRONIC NEWSLETTER The idea of sending a newsletter was cutting edge promotions at that time, and while the idea is still good, there is a new idea that can work better today. Some folks call them e-zines or electronic newsletters. If you are among the millions surfing the Net, you probably receive a couple every month. You may even receive the one from this writer entitled The e-retailer. The electronic newsletter is another way of keeping your name in front of your customers. The biggest plus for the newsletter is that it has minimal or no cost for you to produce. You create your newsletter using your computer and a word processing program such as Microsoft Word. Create a format for your newsletter that you can duplicate on a consistent basis and you are on your way to communicating with your customers in a manner that can be as recognizable as your distinctive newspaper ads. What would you want to tell your customer with each newsletter? No, what would your customer want to read? That is the real question. When the customer opens your e-mail, what can you interest them with that will make them want to read the entire newsletter, and then decide to do business with you—whether it be in your store, on the phone or by way of the Internet? Well, you may want to have two electronic newsletters. If you have residential as well as commercial customers, you will want to consider having separate versions for each. What will be appealing to the homeowner will probably be of little interest to the person taking care of schools, offices and public buildings. In the residential newsletter, if your entire newsletter talks about draperies and window coverings you are going to have two problems. One is that you are going to run out of material to write about in a couple of months. The second is that it is going to become boring for the homeowner to read. While you will want to put in a statement or two about what is new in your store, the newsletter will need to contain information that the consumer can use every month. If you are looking for ideas, just watch a couple of episodes of television shows like "Martha Stewart Living" and you will see what grabs the attention of your customers. For the commercial customer, you can share business news such as staffing ideas, recommendations of business books to read and announcements of interest from other businesses you serve or associate with.   Most assuredly, your e-newsletter will assist your business in fullfilling an old retail adage: "Never forget a customer, never let a customer forget you."   CONTENT IS KING Where can you find the news for your electronic newsletter? One source of news is searching the Internet. Using any of the search engines, look for material using a variety of word combinations and then note which have produced the best results so your job will be easier in the next month. For both the commercial and residential customer, look to find other businesses that have newsletters that you could exchange referrals as well as information in your newsletter. Perhaps there is a local carpet cleaning service that would appreciate a mention in your newsletter in exchange for a mention in theirs. What length should the electronic newsletter be? This is going to depend on how interesting your newsletter is. You can test a couple of versions by asking friends and customers to tell you how well your material holds their attention. For the commercial customers you will also want to think about the reader being more pressed for time than the residential customer. The length is also going to depend on the size of the type, the headlines and the spacing you use. Select a clean and easy-to-read type such as Verdana and use 10 to 12 point type. Another idea that can enhance your chances of getting business is to create active links in your newsletter so readers can easily get to your Web site. An active link will immediately take the reader to whatever location on your site you want them to visit. For example, you may be telling your customer about a new product you have featured on your site. When the reader clicks on the link, they will see a photo and additional information. In making these links you also will want to make sure that all of your newsletter readers will be able to get workable links. Most notable is that AOL subscribers will see things a bit different from the majority of other viewers using different browsers. Because of the overwhelming popularity of AOL, you will want to make sure you do not exclude these subscribers. Undoubtedly, your first e-newsletter will not be your most read or most responded to piece of advertising. However, it probably will be your least expensive. Like a good bottle of wine, your monthly e-newsletter will become better with time. To gauge the success, create a coupon in the newsletter. Or with an active link, take the reader to a spot on your site which will reward the first dozen customers who call your business. Most assuredly, your e-newsletter will assist your business in fulfilling an old retail adage: "Never forget a customer, never let a customer forget you." I wonder what ol' John Wanamaker would have thought of an e-newsletter? Tom Shay is an author, columnist, speaker and president of Profits+Plus Seminars, St. Petersburg, FL, www.profitsplus.org, which offers a free monthly e-mail newsletter containing tips and advice for improving sales and profitability.