I love when a business littered with “know-it-alls” decides to take on the task of slowly destabilizing and then eventually demolishing itself – especially after they had been warned by Dr. Marc – the Dark Lord Of Life – LOL. Hey – I tried to tell them (via a friend), but nooooooooooo….they thought they knew better. After all, “Dr. Marc isn’t in the ____ business, so how the hell would he know what we need to do???”
Dr. Marc does not need to know your business to KNOW your business. The fact is that I can see things that you can’t…even if YOU think you’re doing everything right. That’s what I get paid for…to know what you’re doing to screw yourself out of business. I get paid by very smart individuals who have put their egos aside in favor of actually moving 50 rungs up the ladder of success.
Got it?
GOOD!
ON TO OUR STORY…
The particular business to whom I refer in this post is a photography studio that we’ll simply refer to as Snooty Studio. Snooty Studio is located in a very snooty community filled with snooty residents who value paying top dollar for any good or service. They feel good about paying full retail for a Rolex. They feel good about paying $500 to have their dog shampooed. The residents of Snootyville will spend more on a dog collar than they would a winter jacket for their child (designer of course). Get the idea?
Snooty Studio had built up the reputation of being a place that charged high value-based fees for a high quality service. After the summer, however, business came to a screaming halt. Had they hired Dr. Marc and understood that marketing is not a singular activity or random activities, they would not have had a “slow period.”
Snooty Studio decided to use a well-known coupon service that offered their normal sitting fee (the standard photo session) for 50% off the normal price – for new customers only. Mind you, Snooty Studio had NEVER discounted their fees. This was a first.
The response to the coupon was decent, but the fallout was what we’re here to talk about in this blog post. Most of Snooty Studio’s clientele had been customers for more than 10 years. The customer base had always paid full price for their photographic services. They were happy to pay full price because they believed that the photographic service and products they received were second to none. And to be quite frank, the Snooty photographers (who were decent, but not great) could have probably screwed up a few sessions here and there and not lost “a single frame” of business.
When Snooty Studio ran the coupon, the PERCEPTION was (as they soon discovered)…
1). Snooty Studio is not doing well.
2). Snooty Studio has been overcharging
3). Snooty Studio has been taking advantage
4). Snooty Studio may not be THE BEST
Snooty Studio felt the backlash of their coupon. Sure they introduced new customers to their studio, but as it turned out, these were people who were only going because of the deal – not people who were likely to become regular customers.
“So what?”
I knew you’d say that.
Here’s the deal: When you are a high-value based service, or you retail a high-value product, people who are buyers are buying because they believe that what they are buying is worth their investment. It may not just be the product or service, rather, the relationship. They will continue to spend money with you just as long as they don’t believe that their loyalty is being taken for granted. Got it?
The short-term gain in funds via using the coupon translated into a backlash from which recovery will be difficult. How do I know? Well guess who they called AFTER they made their mistake? Guess who they called AFTER they were told (by many of their loyal customers) that their loyal patrons were “taken aback” by the generous offer extended only to new customers via the coupon? Guess who they called AFTER they were told that using the coupon was like hanging fuzzy dice from the rearview mirror of a Bentley Continental GT Spur?
They actually called an acquaintance of mine…who then had them call me (LOL). At first they acted like they didn’t do anything wrong, and could not understand how their client base was being “soooo unreasonable.” I then explained what they had done wrong, and did so in a way that punched them in the face. But the best part is that I “punched them in the face” with their mistake at a lunch that was also attended by the marketing team (two women and a man with a small firm in Downtown Chicago). I told them that I would meet with them under the following conditions:
1). They pay my consultation fee
2). They buy me a kick-ass lunch
3). They shut the F up while I talk
Without coming up for air, I told them everything they did wrong…including marketing errors that led to their “slowdown.” One of the ladies from the marketing team started to get well up with tears. It wasn’t pretty. No, it wasn’t because I was being jerk (which I wasn’t). Rather, it’s because – like most “marketing experts” and business owners, they didn’t think things through. They know all the answers.
Just because something is a good thing does not mean it’s a good thing FOR YOU. I like some of the new coupon sites. In fact, we purchased a family membership to the Museum of Science and Industry here in Chicago for a wonderfully low price via Groupon. We’ve gone back to the museum a number of times. The girls love it there. But that doesn’t mean that all coupons are good for all businesses.
You have to remember to think things through. And even after YOU have thought things through, it’s not a bad idea to sit on an idea and consider the backlash.
Have A GREAT Day!
…Dr. Marc, MIND VIRUS