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The Johnny Appleseed Theory

A different way of marketing to your customers

Do you remember your days in kindergarten or elementary school? You probably had a part of your school week that contained a music lesson. In this class, many children learned the song about Johnny Appleseed.

According to the song, Johnny went about the countryside spreading seeds to start apple orchards. He carried a bag of seeds, and sang a song in which he was thankful for having the necessary ingredients to grow a successful tree.

I don't remember the song having a second verse. I just remember the last lines of the first verse being, "And so I thank the Lord, for giving me the things I need -the rain and sun and the honey bee." Without a second verse, I suppose we will never know if Johnny Appleseed ever went back to fertilize the trees he had started. Doesn't this make you wonder how successful each of the apple tree orchards were? After all, as with any plant, just putting the seed in the ground and leaving the rest to nature does not guarantee results.

Retailing is a lot like that; the seed, or invitation to do business with a store, is spread through traditional advertising methods. Sometimes it works and sometimes it does not. But, the business continues to spread seeds hoping to see their sales grow. This writer remembers seeing a report on retailing in which the cost of gaining a new customer was calculated to be $20.

The reason for this high price was due to the amount of advertising that was sent out to people who have absolutely no intention or interest in doing business with your company. After all, if you advertise in a newspaper, with direct mail, or on a radio or television station, you are sending your message to the masses.

If I have no interest in purchasing a musical instrument, accessory or related item as a gift or for personal usage, then your advertising goes to waste. We all know this is true for the vast majority of the people being exposed to the advertising of any business.

For example, the local newspaper may have a circulation of 50,000 copies each day. If you place an ad in the newspaper, and are hoping for even a mere 3% response, then some 1,500 people would come into your store or call to ask about the product or service you mentioned in the ad. As you can see, most retailers would be happy if even one tenth of the 3% would respond, for that would mean 150 people came to do business with you.

So, when 25 people do actually respond to the ad, and the ad cost was several hundred dollars, you can see where it would easily cost $20 to get each of these customers into your store.

The second half of the report I mentioned showed that it would cost only $4 to keep a customer. The logic, and economics of this equation says that when a customer has walked into your business, or done business with you over the phone, you have identified a prime suspect - someone who likes music or gives gifts to someone who likes music.

While we are not suggesting we stop looking for customers, what we are suggesting is that we spend more time looking for the customer who has done business with us. Think about the person who buys a set of guitar strings, some sheet music, valve oil, or a new instrument. Absolutely, this cannot be the one and only time they will do so. They will continue to want and need more.

If they have made even one purchase of a bottle of valve oil, we need to find a way to stay in contact with this person. As compared to the rest of the public reading our newspaper ads, we know this individual has an interest in music and the products we sell.

I know of a dealer who tracks the sale of every new instrument. Within two weeks of the customer's purchase, a call is made to ask the customer how they are enjoying the new instrument. And when the customer does not return to the store within six weeks, someone from his sales staff initiates a phone call to the customer.

The conversation begins by recognizing that the customer has made a purchase, and that the store does not think they have been back in to shop with them lately. The question is to ask how they are enjoying the instrument they have purchased.

The sales staff has the authority of offering to the customer the opportunity to have a lesson taught by one of their instructions at no charge.

This dealer realizes that while they are pleased with the initial sale, there is little chance of that customer purchasing music, accessories, or eventually trading up to a higher quality instrument if the customer fails to utilize their initial purchase.

Utilizing a computer software program to track sales, (Symantec's ACT!2000 is a great example) you can keep in touch with these customers. Another way of contacting customers is to create a monthly newsletter to simply say hello and tell your customers what products are new and what is going on inside your store.

With these two, or any other idea for customer contact, you are far ahead of any competitor when it comes to customer retention. When it comes to the idea of growing our business, we all know the critical ingredients; just like Johnny Appleseed knew what he needed. However, it would seem that we should create the second verse and spend time cultivating and fertilizing these customers.

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This article is copyrighted by Tom Shay and Profits Plus Solutions, who can be reached at: PO Box 128, Dardanelle, AR. 72834. Phone 727-823-7205. It may be printed for an individual to read, but not duplicated or distributed without expressed written consent of the copyright owner.

 

MAY 2024
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Small Business

AdvisorieS

The May Small Business Advisory is titled "Planning for a successful accountant" and is appropriate for many with the April 15 tax deadline having passed.

 

Did you work with your accountant? Or, did you just give them a bunch of papers and wait to receive a completed tax return?

 

Successfully working with an accountant requires a partnership. This month's Small Business Advisory gives suggestions of how to make this happen in 2024.

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Increasing revenue is great, but it is not a cure all for any challenges your business is facing. And sometimes, incresing revenue can create a challenge.

Article of the Month

Who is your customer? Some small businesses have no focus. Their customer is whoever calls or walks in the door.

 

And some small businesses have determined which customers, in sufficient numbers, they should spend their efforts to attract.

 

The article of the month shares an old Southern rhyming couplet about business; "The bertter you niche, the more you get rich."


Book of the Month

Lean Startup by Eric Reis is our suggested book for May.

 

As the title suggests, the reader of the book would be someone that is starting their business. However, we see more value than just that.

 

Perhaps you have been in business for many years. We think this book could give insight to items, and methods, that a small business owner should think about with their business today.

BOOK US

With over 25 years of frontline experience Tom Shay is America's leading Small Business Management Expert. He's a "Must Have" for your next event.

Small Business

Advisories

The May Small Business Advisory is titled "Planning for a successful accountant" and is appropriate for many with the April 15 tax deadline having passed.

 

Did you work with your accountant? Or, did you just give them a bunch of papers and wait to receive a completed tax return?

 

Successfully working with an accountant requires a partnership. This month's Small Business Advisory gives suggestions of how to make this happen in 2024.

Small Business

News

 

Top Story

We see that many small business owners have too much of a focus on the "top line" of their income statement.

 

Increasing revenue is great, but it is not a cure all for any challenges your business is facing. And sometimes, incresing revenue can create a challenge.


Article of the Month

Who is your customer? Some small businesses have no focus. Their customer is whoever calls or walks in the door.

 

And some small businesses have determined which customers, in sufficient numbers, they should spend their efforts to attract.

 

The article of the month shares an old Southern rhyming couplet about business; "The bertter you niche, the more you get rich."


Book of the Month

Lean Startup by Eric Reis is our suggested book for May.

 

As the title suggests, the reader of the book would be someone that is starting their business. However, we see more value than just that.

 

Perhaps you have been in business for many years. We think this book could give insight to items, and methods, that a small business owner should think about with their business today.