Simply stated, consultative selling is about the customer, not about you. Consultative selling takes place when your customer’s business improves as a result of your product or service.

But in order to know if your product or service has succeeded in helping your customer’s bottom line, there needs to be some kind of measurement in place. When that measurement shows the success of the product or service, then the commitment of the customer to your products or services becomes secure.

In this sense, consultative selling is a “one off” sale. You find a prospect, convince them you can bring a change to their bottom line, put a guarantee that you can make a difference, and go to work. And if successfully, you will have a lifetime of ongoing work from this customer.

Yet businesses time and time again make one-off sales. They don’t know how to measure the effectiveness of their products or services. So each sale is a one time sale. No repeat business. And I’m not just talking about new and inexperienced businesses. There are businesses that have been around for decades that forget consultative selling.

In consultative selling, it is the relationship that is more important than the sale. It is the relationship to your customer providing a win-win situation that generates a highly successfully and profitable outcome — for both of you.

Go figure it out. How does your product or service help the customer? So they need plumbing. That could be trenches, pipes, bowls, bolts, nuts and screws. How do you put those pieces together in a way that improves your customer’s bottom line? You work faster than the competition? Good. The quality of your work results in a longer time frame before the next replacement? Good. You fix it for free if it isn’t done right the first time? So you should.

Oh, and by the way, if I fix your inventory management systems, maybe you’ll let me work on your sales presentation. In other words, if I can build credibility for myself, maybe you’ll let me do a complete makeover.

Get your customer list. Figure out what impact your product and service has had on their bottom line. If you can’t find a positive result for your client, you’ve got a major hurdle to overcome.

Stop selling “things.” Sell a better life for your customers or clients. And see if they don’t beat a path to your door.

In business, there is only one way. You measure the success of the business with its touchstone.

Think of a builder who uses a plumb line. What’s the purpose? To see if the targeted idea of having the building remain upright has a chance of success.

To have the chance of success, the builder needs something to measure his work by, hence the plumb line.

But what is the plumb line — or touchstone — for measuring the success of the business overall?

After all, the business owner needs to know the walls are straight, the foundations are secure, and the work is being completed within budget. Otherwise . . . .?

You can finish that sentence for yourself. “Otherwise . . . he doesn’t know if these things are in place.”

Now the builder will use the plumb line and take corrective action to make sure things line up. When they don’t he fixes things.

So, too, must the business owner and his managers. When things don’t line up to the plumb line it’s simple.

Fix it!

If this seems a simple bit of business 101 for you, it might be. But how many businesses fail at this point? Thousands, every year. And you could be one of them.

No touchstone.

Therefore things don’t get measured.

Things that aren’t measured cannot be fixed.

Problems that don’t get fixed cost money . . . sometimes more than the business owner has at his disposal.

Now stress has set in, the business owner’s body system is not functioning in equilibrium, and his troubles are only just beginning.

Because if he doesn’t fix the business, he probably can’t get rid of the stress. And that is a killer.

Do you have a touchstone?

It is not always easy to balance theory and practice, yet that is the challenge of business. At the end of the day, we may theorize as much as we like, about prices, markets, the quality of our goods, or our selling skills. But if our business is to survive, we must take our theorizing and fuse it with practical realities.

Management as a necessary practice in every business, but especially small business. If a business has grown beyond a certain size it has already learned that management in some form is essential. What smaller businesses need to realize is that management is the key to growth and without it the business is usually
retarded.

Think of a business as you would think of a child. A child is born, grows through certain stages, eventually reaching adulthood, and then spends the rest of its life expanding its knowledge and abilities. Maturity is a journey, not a destination, an ongoing activity unless we want to stop the maturity process.

Too many businesses are kept in childhood. They never grow up. They remain small, stunted in growth, like a child that suffers from malnutrition. The reasons for this are not hard to find. Either the business fails to grow because it is starved of funds, or else it fails to grow because it is starved of management. These two reasons are related quite often.

Frequently, small businesses succeed in spite of themselves. There are multiple reasons why people go into business in the first place, but not everyone starts a business because they have the management skills to do so. For many people a business is a way to get an income and to get more direct control of their work
activities. The results are not always as expected. Every business functions with five key areas. These areas are inescapable. They exist whether we acknowledge them or not. Successful businesses, however,
recognize these areas and work on them to improve their function within the business. These key areas are:

A business functions by developing activities under each of these areas, then assigning these activities as responsibilities to employees. In the start up, one-person business, it is easy to see who gets all these responsibilities: the business owner. And here is where the trouble often begins.

It takes an extraordinary person to be able to take on all the responsibilities in the business. In fact, it rarely happens successfully. And there is a reason for this. There is more work in each of these areas than one person can expect to handle. The fact that it can rarely be done, however, does not deter many from trying. The results are usually burnout of the business owner or, more likely, the burnout of his wife, with deteriorating life-style and a business that hangs like a millstone around the owner’s neck. How he wishes he had never started this enterprise, and often longs to return to the good old days of a regular wage and less stress.

How did the business owner get himself into this mess? He arrived there by not understanding that each of these five key areas needs to be addressed before any business should be started. Then the problems would have been foreseen and some action plan developed to either prevent certain things form happening or at least manage the issues as they arise.

If you take the first of these key areas and ask what are the functions of the business owner, you create a list that includes amongst them, the necessity to provide the working capital for the business. Well, says the business owner, how much capital do I need to provide? The person to answer this question is the executive officer, whoever he might be. In the one-person business, this happens to be the business owner, who now must provide himself with a credible business plan. But plans cost money, so the business plan needs to have a list of revenue and expenses that go with it. “If we do this, it will cost us so many dollars,” says the business plan.

And now the business owner can respond and either agrees to provide the capital or else demand that the business plan be altered. The trouble in the one person business, however, is that the business owner will
not demand that the executive officer provide him with a business plan that allows him to determine if he has the necessary means to finance this business. No, says the one-person business, I can step around these conventions of planning and just launch the business. All will be well. And if the business owner is a Christian, he often backs this up with the ultimate insurance policy: God will ensure my success in spite of my
poor planning.

Unfortunately, not all businesses started by Christians are successful, so either God is a failure, or else you might consider that God wants you to operate in a different manner. God, of course, is under no obligation to bless us, though He promises to do so as an act of grace. Christian business owners must confront the same market conditions as non-Christians. And at the end of the day, a business needs to be managed, irrespective of the religious belief of the owners. This is the food that stimulates growth in the business and if we fail to feed the business with good management we can expect it to have stunted growth or it may even die young.

The problem of the business owner is compounded even more when he asks the executive officer (himself) to provide a business plan and he discovers that the executive officer cannot read a profit and loss statement, does not comprehend a balance sheet, and cannot even tell the difference between a debit and a credit. (And this is made even more difficult if we ask the executive officer does a debit add or subtract an amount, a trick question for those who don’t understand accounting.)

The business owner is in over his head already, without considering the other areas of the business. It may well be that the business owner has selling skills, or he may be a brilliant engineer and can weld steel better than most, but it is a rare occurrence to find a business owner who can do these activities. And even if he can do them all, the needs to ask this question: Who is doing the selling while the financial officer is entering data into the computer and producing management reports? The answer, of course, is that no one is doing the selling job, just as no one is cutting the steel, operating the printing press, or providing whatever service it is that this business offers. Neither is anyone managing the marketing and sales area, managing the production area, or managing the finance and administration area. In other words, this one-person business is short on management. On top of all this, if the same person doing all this work is the executive officer, then no one is fulfilling this function because the executive officer is absent from his desk while he is the
salesman, the delivery man, the order taker, the receptionist, or some other task in
the business.

And therein lies the difference between a small and a large business, a successful business and a not-so-successful one. It is not that the larger and successful business has a perfect system of management, as so many have discovered in recent corporate failures. But the business with proper management practices gives the business a much better success rate. For example, the one-person business operator longs for the day when he can make a million dollars. But he does not realize that in order to make that million dollars, it might cost him $3,000 a day in expenses for each day he works (approximately 240 days a year on a 5-day working week). And if he does not keep track of the money owing to him and keep this in check, for every day he has to finance the business from his own pocket, he has to find that $3,000 to pay the bills. If he collects his money in 45 days, but pays all his suppliers in 35 days, then he needs to find an additional $30,000 just to keep the business afloat. Almost no business owner thinks about this when he starts up his business. The ones that do are usually management-hardened executives from larger corporations who have decided to go it alone. (Buying into a franchise is sometimes, but not always, another way to start up a business with management practices in place.)

The one-person business owner, however, finds a willing partner to aid him: his wife. In many instances, she can’t do the work of the business, is not a sales person, doesn’t understand marketing (how many people really do?), so she will be given the accounts to do.

“We’ll get a computer, honey, and you can do the accounting.” While many wives make marvelous debt collectors, they are not always so good a producing the management information necessary for their husband’s success. And as she is often combining this with home duties such as feeding the children, changing diapers, cleaning the house, running children to the doctor, dentist, and the myriad other things of which many husbands are not fully aware, it does not take long for desperation and burnout to set in. “I want out of this business” is a familiar refrain from many wives. It is understandable — and to be expected.

In many instances, management has found it difficult to justify the employee’s salary. In many organizations it is difficult, if not impossible, for a firm to assess the true value of a worker. As they have attempted to determine costs and consider cheaper alternatives, outsourcing work to independent contractors has become a viable option. Since it is difficult for a company to assess the real value of its employees, it never knows whether it is getting value for its money. Nor does the employee know if he is being paid his true market value. By forcing staff to compete as contractors against all other suppliers in the marketplace, then, the business firm is better able to gauge the value of the people it hires. And the workers gain by being able, first, to assess the value of their contribution by comparing with their competitors, and second, by being able to take on additional contracts.

The point being: although it can be difficult for those out of work in the short term, unemployment is not necessarily bad in the long run. Provided business entrepreneurs are not hindered from starting new businesses, they will soon begin to absorb the unemployed into new ventures. Armed with intimate knowledge of his field, someone out of a job could bid for work at his previous place of employment, offering to supply services at competitive market rates. In doing this, he will need to be able to convince the potential buyer that he can deliver the required service at competitive rates. By doing this in such a way as to add value to the service, he can usually reduce the overall cost to the client. And through this new position, what his former company could not see in him as an employee will be much more apparent in his new role as a supplier.

In essence, the worker is starting his own business. He becomes self-employed. No longer does he depend on a fixed salary, but instead lives on his abilities to supply a satisfactory product in the marketplace. He will be rewarded accordingly. And in most instances, provided he learns the necessary skills, he will do better in his own company than he would on a wage or salary. In the end, then, the currently unemployed may be in prime position for future financial success.

More recently laws such as copyright, patents and trademarks are used to create monopolies not of political power but of economic power. Music writers sell their compositions to music publishers who invest
the time and money in print and marketing to create sales. The publishers and shareholders want a return on their investment. They are clearly not happy if someone gets access to the same product without paying for it. Book writers do the same.

So do hamburger makers. So if I want to buy a McDonald’s hamburger, I have no choice but to go to the licensed McDonalds monopoly somewhere and buy. As much as this might be an inconvenience, I cannot go to the Burger King outlet and buy a McDonald’s hamburger, just as I cannot buy Taco Bell at McDonald’s. They each protect their property by insisting only approved sales outlets can sell their food, for which the parent company receives a percentage of the sale. This is just as much a monopoly as is the publishing of songs, so the attack on the publishing industry for protecting its monopoly could be construed at the same time as an attack on all forms of endeavor to protect the fruit of one’s labor and capitalize on it by creating a monopoly selling outlet.

People want to get paid for their work. This is a natural desire, for to get rewarded is the means to buy other goods and services. Without such reward, composers, authors, inventors will need to create other sources of income, and when they do this they are not free to compose, write, or invent. There are a myriad of examples of how people protect their intellectual property. Publishers of electronic books may reserve the right to exclusive publication of paper editions. They want to keep this monopoly to themselves for whatever reason. Some music artists want to be able to sell their recordings exclusively through a monopoly selling channel. We can choose to participate or not participate under the artist’s terms. The current practice of taking the artist’s music, now matter what terms he dictates does not appear a good way of creating neighborly relations, or living out the idea that we should somehow love our neighbor as ourselves.

Thus, the debate over copyright has a much broader implication than just copying music. And the issue in music is not just over new technology. Deep down, it is the desire of many people who expect others in the world owe them a living. They just don’t want music via the internet. They want free music, no matter how it is delivered. If they could pick up a free CD in the store, this would suit just as well as downloading a file for free. They don’t care about the costs of creating the records, the hours of studio time to get the tracks completed and the editing to patch together several takes to create the “perfect” performance. All they want is free music, which is music at someone else’s expense

It is this desire for goods at someone else’s expense that is at the heart of the music copyright debate. Well might we complain about the price, but as economists love to tell us, the buying market, not the sellers, sets the price. So it seems that those who buy are willing to pay current prices, but the free loaders object to this. They would, as e-mails to me have confirmed, object to any price because at the end of the day they don’t want to pay anything for their music.

It is fortunate that there are enough willing buyers to keep the sellers in business, for without them our recording, publishing and inventive industries would be starved for new ideas and an unwillingness to invest in something that could be taken away from them so easily. And our lives would be poorer for it.

For some of us, the arts world has become politicized. Artists of various kinds are often at the forefront of social change, such as Wagner was in his attempt to create revolution through music. (See the book, Dionysus Rising , by E. Michael Jones for details). Christian moral standards are challenged in the form of shapes, form, sounds and sight. The result is that the arts have contributed to the breakdown in Christian culture.

A consequence of the art subsidies has not been better art, if we judge art by its public acceptance. The mere fact that subsidies exist is evidence that some artists cannot operate in a voluntary marketplace. Whereas Abba or the former Beatles made it big without government aid, other artists would starve or find another profession without subsidies.

Like any other business, subsidies are a sign of a marketplace that refuses to buy voluntarily. Artists survive because of the coercive nature of taxation; that is they survive by receiving financial aid that is not voluntarily forthcoming.

With the advance of government subsidies in the twentieth century, we are hard pressed to find any improvement in the standards of Art. Jackson Pollock conned the Australian government into forking out millions for a painting that made little sense to discerning viewers. Playwrights, composers, painters and musicians have not given us better standards of either composition or performance. In fact, since modern art is keen to abolish all the old standards and replace them with . . . well, that’s the problem. The only standard that applies today is anything goes (well, almost).

The result? Art that has no standard, no criteria by which to judge. This has not led to an improvement in the arts but a downturn. This is why the subsidies are necessary.

Now that governments are looking down the barrel of financial difficulties, the loss of subsidies might again challenge artists to write, paint or compose in ways that appeals to the ordinary people. J.S. Bach, for example, while not receiving subsidies was paid by the church to write music acceptable to the worshipers in the church. Today, we find the music that was governed by so many seemingly archaic rules retains a freshness and vibrancy that escapes many modern artists.

Rather than mourn the loss of art subsidies, we should see this as a step in the right direction to restore art to its noblest aims, that of enriching mankind with music, paintings, poetry, and song that uplifts and edifies. Such music, like a good film score, will appeal because of what it achieves in the listener or viewer, not because it is financed by involuntary taxation.

There is a parallel in business that is inescapable. Businesses that require subsidies do so because they fail at some point to satisfy enough consumers with their products to remain in business. The subsidizes can be in the forms of government handouts or loans. In the long run, however, people tire of subsidized business because having their financial needs met by other mechanisms, they no longer need to satisfy the market
as the means of remaining financially solvent.

The end of subsidies in art or business will give us better art and better goods and services. The sooner they go, the better off we will be.

I can think of no topic that gets people’s backs up so quickly. The idea that people should actually own something and protect it by law is under challenge. Especially if that property is “intellectual” property.

Imagine for a moment that you wrote a song, a popular one at that, and you’re making good royalties from the recording company who had contracted with you to market the product. But there are some individuals who reject the notion that you and the record company should make such a deal. They think your song should be “public domain” and available free to everyone. In short, they don’t like the idea of you making a living off your song-writing abilities. They also don’t like the fact that the recording industry should be paid for its work in making your song successful.

It seems that many Spaniards think like this. According to an article in the July 2005 edition of Billboard, Spain was the ninth largest market in the world for recorded music. Yet according to EMI Music Spain president Manolo Diaz, Spain “has a street-level piracy that does not exist in any other civilized county.”

Unfortunately, it seems, there are many Christians who think the same way as the Spaniards. Piracy is rampant around the world. And it’s not just music that is at risk. Software also is freely copied, denying the original owner exclusive rights to sell his own property.

What is noticeable is the envy that underlies the piracy mentality. Envy is expressed in the idea that if I can’t have something then no else should have it either. It seems that if some people cannot make money from song writing, they are going to make sure that no one else can do it either, even if it means abandoning the idea of property rights to do so. Yet if those same people had their motor car or other items taken and used without permission they would soon cry out, “stop thief.”

The photocopier, the tape recorder and now computers and CD/DVDs are the tools that have allowed the challenge to intellectual property rights. Patent and copyright laws are under challenge in the modern wave of copyright and patent infringement. Communism, the idea that property is owned by everyone, is the popular notion in intellectual property. No one can own anything, and everything you have is to be available to your neighbor free of charge at his demand.

Long ago it was said, “Thou shalt not steal” and this is the basis for all property rights, intellectual and physical. Which is why freedom to own property of all kinds, a major contributing factor to the success of Western civilization, needs to be re-evaluated.

Too often we associate the idea of psychopath with Anthony Hopkins brilliant portrayal of Dr. Hanibal Lecter.  Lecter is a psychiatrist with an eating disorder: He’s a cannibal.  So you see him on the screen apparently eating someone’s brains.

Now that picture is not one of a business consultant.  But neither is it a picture of a real psychopath.

There are  number of identifiers of a psychopath, and his near-twin brother, the narcissistic personality disorder.  They share some common traits.  One of the identifiers is a continuous attempt to manipulate people and outcomes.

But the most obvious identifier of the psychopath is anti-social behavior.  Sound familiar?  It should.  It is common among people who insist that their understanding of life is the only one.  Others must conform to their model of reality.  And they will undertake a number of activities to ensure this occurs.

Chief among these is manipulation.  They want an outcome — their outcome.  They will lie and cheat, use threats, violence and sex and do whatever is necessary to achieve that goal.

And they will do it such  charming way, that you don’t see the danger . . . until it is too late.

In the business consulting field, the psychopathic consultant is one who is supremely confident that his method of operating a company is the only one and you need to conform yourself to his management model. What are some of the signs of this consultant?

Maybe this is a picture of your consultant.

Or, it could even be a picture of your boss.

There is one response: run.

In recent years, the choice of self-employment has not been an option; it became an imperative as business after business has shed its workers for a variety of reasons. In the midst of the business down turn, self-employment has become the means many have found to keep themselves in luxuries such as bread, milk and
sugar.

But having found themselves on the self-employed route, many find the journey tougher going than they anticipated. For many, it results in early retirement from self-employment and a loss of confidence in this kind of business activity. The mistakes many make, however, are readily overcome with a little planning and
thought.

Here are some of the common mistakes made by startup businesses.

1. Lack of funds
At the end of the day, business needs money. However you look at a business, you soon find it does little else than consume funds. Business is, more than anything else, an expensive item. How expensive? It depends on the kind of business. But every business consumes capital at an alarming rate.

If nothing else, the business needs to provide a source of income for the business owner, not as profits to the owner but as a wage or salary to an employee.Nearly every small business I have been in (including my own in the early days) fails to pay the business owner a market wage. Not paying these kinds of expenses canhide the true cost of running a business. While owners may forgo income in the shortterm to get the business rolling, most business people do this because they don’t havethe funds. If they don’t have funds to pay appropriate wages to the workers(themselves), then they probably don’t have adequate funds for sales and marketingof the business. Or perhaps they don’t carry some of the insurances a business reallyneeds to protect it from disaster. The source of this problem is a lack of funds.

2. Too Much Debt

To solve the funding problem many business owners borrow to get the business going. But borrowing money can lead to some unexpected results. There is a principle that in order to manage big things, we first have to learn to manage small things. Property renters learn this quickly. If a prospective tenant can’t come up with the bond money, then he probably is a bad risk.

Borrowing sums of money when we not learnt to manage such sums can easily lead to disaster. One business I know exhibited this problem. The new owners obtained a $50,000 loan to start up the business, and spent a huge portion of it leasing prime office space and furnishing it to a very high standard. Rather than
apply the funds to marketing and sales, they spent it on appearances. They lasted about three months before they shut the door.

3. Poor Pricing
The way many businesses get started is by pricing themselves at the lower end of the market. This pricing strategy has nothing to do with pricing for results. It is just that the business owner really does not have the courage to ask the higher prices that established businesses are charging.

To his hurt, the under-priced business owner soon finds that his customers really don’t appreciate him or the fact that he’s so cheap. He finds that his customers soon drift off to do business with the higher priced people in town, leaving him to find a new customer to replace the one he has lost. What he fails to realise is that his customer has left him because the quality of the service that can be found elsewhere is superior, and at this prices he can never afford to compete with more expensive competitors.

It takes a year or so (sometimes a lot longer) of operating like this before the business owner decides he has little to lose if he puts up his prices. So he timidly asks the next customer to pay more, finds he gets no rejection on the basis of price, and finds now he can afford to offer a better quality service or product to the customer.

Since people do not buy on price but on value, the business owner is beginning to learn that his price is not as important as the value he brings to his customer.

Those businesses that don’t reach this stage die a slow and lingering death. Sometimes they last for years, often for no other reason than the business owner really can’t find a job elsewhere, so he keeps his little business going because it is better than nothing. He neither learns nor desires to learn the mechanics of business that would help him price his products competitively without being at the lower end of the market. Some people are just too proud to be successful.

4. Poor Sales and Marketing
At the end of the day, business is only produced when a sale has been made. Yet many attempt business without the skills of finding customers or making a sale. Somehow they believe that customers will walk in the door and all will be well.

Unfortunately, this is often a characteristic of religious folk who go into business for themselves. They believe God calls them to this business and that failure is impossible. What they forget is that while God may have called, He did not offer to help them bypass normal business practices. Just as Christian farmers must adopt good farming practice to be successful, so must service and manufacturing businesses adopt good business and management practices in order to succeed. If business were easy all of us would be millionaires. But even McDonalds continue to advertise their beef burgers and fries. And if established businesses such as these need to continually advertise their products, you can be certain that the startup business also needs a similar strategy.

Often the lack of marketing skills is tied with the lack of funds. Somehow business owners have to find a way to tell people the business exists and why they should do business with it. This might be done through radio, TV or newspaper advertising, telephone calls, direct mail, or personal calls. But however, it is done, it
will cost money – lots of it.

5. Poor Management and Leadership
The common mistakes listed above all fall under a general heading: poor management and leadership. This, above all determines the success of the business. And while it is not necessary to get every step in business right, you have do enough right things to make the business work properly. Startup businesses are driven by a vision of the business owner. Too often that vision cannot be articulated clearly and translated into economic results (profits) for the business. Unless that vision is translated in goals and activities in the business, failure looms higher on the horizon. Management practices are needed to bring the vision to fruition.

This means giving appropriate time to planning, implementing appropriate accounting systems that accurately reflect the status of the business, hiring staff that will share the owner’s vision, then getting down to work of locating clients and creating happy customers. The failure rate of small businesses is high because of the
kinds of mistakes listed above. But as I have written in my book Making Sense of Your Dollars: A Biblical Approach to Wealth, owning a business, or sharing in one, is the way that our economic wealth is created and expanded. By avoiding these common mistakes in startup business, you can considerably improve our chances of success.

Clarion Communications offers a range of services that teach business owners management principles, including our very own do-it-at-home (or at the office) study material. The first series of lessons on finance are now available. For further information, send an e-mail to sales@clarion-communications.com. We’ll show
you how to develop and maintain management practices that will give your business
every chance of success.

1. Failure to Identify Customer Needs
Given that our goods and services are purchased to satisfy some need, it is surprising to see just how much advertising fails to meet the test of telling customers how this particular product or service will meet a perceived need.

The needs of customers are not that many, so it is difficult to understand why so much advertising fails to tell prospective buyers how a product or service can meets the needs of quality, performance, safety, convenience, or savings. If you want your advertising to work more powerfully for you, make sure it tells the reader how it satisfies some need in their lives and why it does it better than the competition.

2. Direct-Response Advertising
There are many kinds of ads we see in print or on screen. Some are informative. They tell us what`s available in the marketplace and where we can get it. And that`s where they stop. It makes no attempt to get the immediate buyer to do anything else than remember where to get a particular item or service.

Another kind of ad, however, does the same thing but goes one step further. It asks the reader or listener to pick up the phone or a pen, and respond immediately to the ad. This is direct-response advertising, and it has two important advantages over other kinds of advertising: immediate results and measurable results. It doesn`t take much to generate immediate sales, perhaps some time-limited special offer if people “act now”. And if the offer is genuine and of real value, then people can be expected to respond immediately to an ad.

Direct response advertising also allows for measuring the responses from the ad. This is important if we are trying to determine if an ad is producing sufficient business. By measuring response, we can also try other ads to see which produces the best results, thereby getting maximum value from our advertising dollars.

When cash flow is tight and sales are needed immediately, direct response advertising holds out an opportunity to bring immediate sales and therefore immediate cash to the company. Big companies can afford to waste money on advertising that does not require an immediate response. Smaller businesses don`t
have that luxury. Every advertising dollar must be made to work more powerfully, and direct-response advertising is the way to ensure this result.

3. Testing Advertising
Advertising needs to be tested, and there are many elements that can be tested to see where improvements can be made. A good headline is worth everything, because if it does not capture the attention of the reader or listener he won’t read or listen to what follows. A good headline, therefore, can significantly increase the response. Headline testing is an ongoing battle to capture the minds of readers and
listeners.

The copy of an ad should also be tested. Get a good headline and stick with it, but experiment with changes to the copy. Find improved ways to offer your product. Capture the imagination of the prospect so that he sees how your particular product will meet his needs better than any other products in the marketplace.

In newspapers or magazines it’s important to test the position of the ad. Many publishers will charge a premium to have an ad placed on the top portion of the right-hand page. They can do this because ads in this position tend to get read more often. Whatever you do, test the position- left-hand (verso) or right-hand (recto) page, top or bottom.

In radio or TV commercials, the way to test position is by time and the placement of other ads around yours. Insist your ad appears before or after different ads. Try a different time of day and night. Find out which works best for you. It goes without saying that an ad should be tested in small quantities before you
undertake the full rollout. One of my friends in marketing once insisted that twenty people was enough to provide a reliable sample, a point he had proven to many of his clients. So it is not necessary to test large numbers, but it is necessary to test. Then, when the full rollout occurs, the advertising will produce the best possible result at the time.

4. Closing the Sale
All advertising sells. Some ask for an immediate response. But in the end, all advertising sells.

As a result, it is important in advertising to use genuine proven sales techniques. Many people have a misconception about selling, an idea fostered by bad salesmen in the automobile, computer, or other industries. For many, sales means pressure to buy. For the professional salesmen, however, sales means providing people with the best information so they can make an informed decision.

Having informed the prospective buyer, however, it is then necessary to ask the customer to buy. This is called closing the sale, and there are many ways that this can be done in a conversation.

In written or spoken advertising, it is just as important to close the sale. You must ask the customer to buy, and ask him to buy now. That this needs to be done sensitively, without pressuring the buyer, goes without saying. But an awful lot of advertising fails the test at this point.

It is surprising to see just how much advertising fails to close the sale. The advertising copy can be brilliant, explain all the benefits, have a catchy headline to get people to read the whole ad, then fail to ask them to buy.

Make sure your advertising has a close. Ensure that it asks the prospect to make a decision now to buy the product or service. There is perhaps no better way to waste advertising dollars than failing to ask the prospective customer to “buy now”.

These four simple areas of emphasis can make all the difference in your advertising. Follow them diligently and they will give you a huge advantage when people read your advertising. And if your product or service is as good as you think it is, then those prospects who become customers will thank you for the extra effort you made to help them in their buying decisions.

Clarion Communications offers a range of services that teach business owners management principles, including our very own do-it-at-home (or at the office) study material. The first series of lessons on finance are now available. For further information, send an e-mail to sales@clarion-communications.com. Learn how you can develop and maintain management practices that will give your business every chance of success.