represents a huge investment for most jewelry stores—in fact, next to wages and
rent, it is often a store owner’s largest expense. Unfortunately, it doesn’t
always receive the time or attention it deserves. This month, I identify the
eight most common mistakes that retailers make with their marketing.
1. Spending money just to
get your name out there: This is often categorized as branding, and works for large
corporations such as Coca-Cola and McDonald’s that have the budget to back it
up. This approach requires a lot of repetition to reach the consumer’s psyche,
and unless you have deep pockets, it’s best avoided. You can achieve an
identity or “brand” for your store—but not by wasting money on advertisements
that don’t get results or that lack a call to action.
2. Throwing money at
attracting new customers rather than looking after the ones you have: Given what it costs to
attract new customers through advertising (newspaper, radio, television)
compared with the relative expense of client maintenance (database mailings, e-mails,
clienteling), it’s no wonder it costs almost six times as much to nab a new
customer as it does to keep a current one. By all means make sure you allocate
part of your marketing budget to bringing in new customers—but don’t neglect
the captive audience you already have: More than 65 percent of buyers don’t
return because they believe the store doesn’t care about them.
3. Confusing the
difference between needing more sales and needing more customers: It always amazes me how
stores are prepared to shell out funds to recruit “new business” and yet ignore
the fact that 90 percent or more of potential customers who come into their
store leave unable to find what they’re looking for. Before you decide if your
store needs more customers, determine how many are walking through the door in
the first place. Do you know your foot traffic count? Do you know what
percentage is actually making a purchase? Without this information, it’s a
guessing game. If you aren’t aiming at the target correctly, then firing twice
as many bullets isn’t going to get you a hit.
4. Seeing marketing as a
cost rather than an investment: Your marketing, if done right, should cost nothing.
It should generate sufficient revenue to more than exceed its initial cost. You
don’t hide your money under a mattress if the returns from an investment aren’t
good; you seek another investment. The same should be true of your marketing.
5. Attempting to hit a home run with only one
advertisement: If the offer is really good, you can get results
with one advertisement, but more often than not the odds are against you. Most
customers need to hear or see the same advertisement more than once before they
react. As the saying goes, repetition encourages recognition.
6. Focusing on the tactic (where to
market) without having the strategy (why to market): Too much advertising is done by owners
because they think they “should.” We touched on it with No. 1—an effort to get
the name out there and hope something sticks. Advertising reps often push and
prod the client, and a decision to advertise is hastily made. What to advertise is considered second.
If—when you are approached to advertise or market yourself—you can’t
immediately identify what you will be promoting, then you are driving down a
road without a destination in mind.
7. Being exactly the same as everyone
else: Last year I
holidayed in Malaysia. As often happens in beachside resorts, the daytime
traffic dies in the evening, giving way to curbside nighttime markets.
Wandering through row after row of tents, I was staggered by the complete lack
of variation among the merchants’ offerings. Every stall carried the same
sunglasses, the same football shirts, the same imitation handbags. It was a
perfect opportunity for shoppers to bargain, because they knew they could
always find the goods cheaper someplace else. These stall holders were victims
of supply and demand—and this is not uncommon with jewelers: They offer the
same product as their competition in similar-looking stores via the same method
of promotion, and then wonder why their product is being treated as a
commodity. Marketing provides a real opportunity to demonstrate that what you
do is different.
8. Not measuring the results: Failing to measure the results will find
you continually investing money in promotions that don’t work. An even bigger
shame is the store that finds a winning formula…and then stops doing it while it’s still working! Clients often ask: “How
long should I keep a promotion running?” The answer is simple: until there is
an alternative way to spend the marketing money that offers a better return—or
at least until the profit gained no longer exceeds the cost.
Tony Argyle is a CPA and consultant to jewelry retailers in the United States, Australia, and New Zealand. He and his wife, Leanne, are the founders of JewelryMarketingSolutions.com, which provides marketing advice, promotional
ideas, and resources to independent jewelers.