Drop The Unimportant

“I don’t even look at that anymore” said the calm voice on the back row. “All I know is our revenues are up, our bonus payments are up, and our customers are happy. Oh, and my hours are actually down.”

Well, that got everyone’s attention.

The question posed on the seminar floor was, “How do you track all your ad revenues, per media, per ad?” and the answers involved software, tracking questions, and solid follow up. That was when Mr. Calm spoke up. His answer caused most of the heads in the room to swivel.

He referenced that “…I used to try and keep up with all the pennies I was spending. But then I noticed all the dollars I was missing” he laughed. My mind drifted to wonder how many of the $3.5m he’s doing now in a medium sized eastern town he’d actually missed. The inevitable break of the silence…

“So what DO you keep up with? Don’t you want to know how all your leads are coming in?” asked the intelligent lady in row 1.

“Sure, that sounds reasonable” he answered, “but if I had to count my friends only by how many called to wish me a happy birthday, I’d feel pretty lonely.” Another round of laughter. I half considered asking him to finish the seminar. “I’ve got another way” he suggested. And with that, I took notes.

Save Twice What You Spend

“We follow that method up there on the screen” he said referring to a pie chart of media allocation. (Send a polite email with the request, and we’ll send you one.) “But every year for the past 5, I’ve dropped my Yellow Pages by 5% and put 2.5% into Retention.”

He continued, “I’m now down to what Hudson calls a ‘Conservative’ but I’m getting as many or more leads than ever, way more referrals, and we don’t jack around with as many time-wasters.” Another bit of laughter. I’m undoing my microphone at this point.

“What I came to figure out is that I can’t count every bloomin’ lead traced back to every possible penny invested in each media…so I don’t. I just know that my customers tell me they aren’t going anywhere, and they nearly force their friends and neighbors to call me. My ad expenses are down from 5 years ago as a percentage of sales, but my sales and profits are up. The Yellow Page guy doesn’t seem to share my excitement though!” I’m clipping the microphone to his lapel.

In 5 years, his Yellow Page expenses are down 25% (to 24% of his total budget), and his Retention investment is up to 10% of his total. Almost exactly where we peg a “Conservative” marketing platform. Uncanny. He’s spending less, getting more, and quite plainly doesn’t feel the need to analyze it within an inch of its fruitful life.

“Carry on young man” he said with a hand gesture. “I think you’re doing a fine job… except that I can’t hear you anymore.”

EPILOGUE: I spoke to this gentleman following the seminar and thanked him for his enlightened input.

A point unmade in his commentary is that part of the Retention investment was in Maintenance Agreement marketing, with the other part in thank you cards, gifts (to bigger purchasers and referrals) plus newsletters. I looked back at our records, and as he indicated, his Newsletter investment here has gone up, like clockwork. Now if I could just get him to write my speeches.