Close the Margin Gap

In today’s tough economy, everyone is concerned about price. Consumers are watching every penny they spend. Unfortunately, this can lead many businesses to institute promotions and attempt to “buy” the business - any business. While I understand the mentality, I urge readers to be careful how they look at sales promotions for their products or services.

The last time I spoke about the Margin Gap, back in July, I spoke of the auto manufacturers and their price promotions. They conditioned their target market to simply wait until a 0% financing or employee pricing promotion. If such a promotion was not going on, people simply would simply wait until it was.

My point here is this - certainly everyone is looking at how they can get more business. However, instead of strictly cutting the price, look at how you can provide more value. More and more prospects are looking at just price in times like this, but if you can demonstrate more value than your competition, you’ll be better off. While you might not get any many customers as you would if you slashed your prices, you’re at least getting better margin. And keeping your brand from falling into the price / commodity abyss.

In our first article below, Michael McClellan discusses the learnings from a recent research project. Todd Schnick examines how to use direct marketing to target your best customers in the second  article. Brent Brooks follows up his “Meet the eXpert” presentation with a message on using heroes and villains to tell your story.

Steven Winokur, Turning Point Strategies

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