m2weekly.com » Commentary

Streetwise Ideas for Wooing Customers

m2 — Tue, 07 Sep 2010 08:35:23 +0000

Dele Ogundahunsi
Are you a marketer with a new product or service? Or, maybe you have a product or service which is already in the market, but needs a flock of new customers to bring in extra income for you?
In both cases, you may like to think the best way to make more income from your sales efforts is by calculating the cost of making your product or service available to the consumer and then adding a margin of profit to this cost. So, very quickly, you may do your calculations as follows:

Cost of production/purchase of the item you wish to sell (30 Naira)
+
Cost of promoting the product/service to the customer (10 Naira)
+
Cost of delivery to the customer (10 Naira)
+
A margin of profit for yourself (20 Naira)
=
Total price paid by customer (70 Naira).

More often than not, this does not translate to more income for you. For your first-time customers, the price may be too high especially since they have never tried your product or service and may not have enough proof of assurance that the product or service will deliver the results they expect. However, with the following three methods, you can do away with your profit and promotional costs and still get more than your share of customers who keep coming back to buy more. Yes, you can eat your cake and still have it!
One way is to reduce your price for first-time customers. Let’s assume in the above example, you decide to forego your margin of 20 Naira. It means you do not make any profit on that first sale to your new customer. But neither do you make a loss, because what the customer pays at the end of the day (50 Naira) will be enough to pay off the costs of production/purchase, promotion and delivery, which totals 50 Naira. This is called the break-even point. At the point of this 50 Naira, you have made neither loss nor gain, because your costs or expenses are equal to your revenue (you have spent 50 Naira to put the product together, promote and deliver it to the consumer and it’s exactly this same 50 Naira that you get back from the consumer.) You have therefore “broken-even”.
Now, let’s assume I was this first-time customer. I knew your product or service was worth 70 naira but you have sold it to me for 50 Naira, because you wanted me to try it and see if it delivered on the results I expected. After trying this product or service, I found out it delivered great results. Surely, I would always come back for more, but then I would be more than ready to pay 70 naira, or even more. You have a repeat customer who is ready to spend even more on subsequent purchases. Me!
By removing your profit margin and reducing price for new customers or on new products and services, you are removing barriers to first-time relationships. Then, you can earn extra income at the backend.
Again, do you know each customer you have made has a potential of bringing in tens and hundreds of other customers? Sure, you can cut down on your promotional costs through what is known as Referral Marketing. Every time you deal with satisfied customers, ask to meet or communicate with their friends, or anyone important to them, about your products or services.
You could even make it a bit formal by getting such old time customers to enter the details of other people they want to refer in a document. Promise to give a freebie to any customer who is ready to refer others to you. Also, let the people they refer to you get a sample or demo of your product or service for free, so they don’t only see you as somebody they can trust, but also as an expert or marketer of genuine products or services.
By doing this, you will not only win them over, but you will have succeeded in making them come back to you and even getting them to refer their friends to you. This is another way to earn extra income from your marketing efforts over and over again, all at little or no promotional cost, as you have spent little or no money to promote to new customers referred to you.
Yet another cost-killing way to enrol a constant stream of new customers is to ask if there is any other marketer or company out there who presently has a strong relationship with customers to whom you can sell your product or service. This is called the host-beneficiary relationship, where the other person is the host and you are the beneficiary. The product/service sold by that other company/marketer must be related (or complementary) to yours, rather than compete directly with what you sell (for instance, you sell socks, while she sells shoes). Make contact with such marketers or companies, ask them to introduce your product or service to their customers and give them lots of information on what you sell. Again, give them testimonials which attest to the quality of your product or service. However, don’t forget to offer something in return: a percentage of the income you earn from each sale to any of their customers or an arrangement to help pay part of their cost of promotion will do the trick, among others. I have seen a hotel which made a deal with owners or drivers of airport taxis to recommend the hotel to their passengers as the passengers board taxis. In return, as soon as a typical taxi driver drops-off a passenger at this hotel, the taxi driver gets a gift from the hotel and is also eligible for a weekly raffle draw which enables him to win a high-end prize. The drivers know the terms of the relationship and know that by convincing a passenger to use the services of that hotel, they win the instant prize and qualify for the draws!
These are street-smart tips you do not have to learn at the business school. Practise them one after the other or together. At the end of the day, you will be dealing with new customers who are ready to buy all year round.

Dele Ogundahunsi is Lead, Strategy & Growth at MarketingMix & Company Limited. He is also on the board of The Field Marketing Company.

Has Coca Cola Really Opened Up Happiness?

m2 — Mon, 06 Sep 2010 17:46:26 +0000

Babatunde Adebola
Can a brand really stand for something? Can it balance its interest with ambition? Not everything in life that counts can be counted. In many places, brands are. They should be here for good. Here for the long run.
Sounds deep? The italics are all mine but the credit goes to Standard Chartered Bank. These near-sacred words are lines from the body copy of Standard Chartered bank’s current ‘Here for Good’ campaign. It raises concerns on what multi-national corporations should be beyond their show of corporate citizenship, demonstrated in form of taxpaying and splashing of photographs bearing smiling faces published under the guise of fulfilling CSI mandates.
True. The business of any business is the business. The unique selling proposition of any brand is to make the cash register ring. However, recent developments have fractionalised the bottom line into three. People. Planet. Profit. As such, any brand worth its name should strive towards this ideal, fast becoming a reality in corporate practice.
Were Karl Marx and his friend Frederic Angels around today, they would have taken a second look at their postulations that communism would be the highest stage of socio-political and economic development. Today, the values of capitalism and democratisation have taken over nearly every facet of living. The original Thomas Hobbs’ reason for the existence of the state which is to provide greater happiness for the greater number of people is now in the few private hands that government is fast loosing grip to.
Futurologists like Alvin Toffler, since the dawn of this century, have been telling whoever lends listening ears that the future of the state is in the hands of corporations. When tomorrow comes, they posit, the only thing states will be busy doing is managing security establishments for peace whilemultinational corporations will rule, in fact across borders; thanks to the ubitiqous power of globalization and the World Wide Web.
With this, brands have and are indeed becoming more than just brands. It is against this background that we should all begin to look under the cork. We should resist the temptation of a few crisp naira note promises and question the current Cola-Cola ‘Open Up For Happiness’ promo which claims, with noble intentions, to celebrate Nigerians who down its liquid content on the golden jubilee of their fatherland. Fair enough.
Coke came to town with an ambitious teaser: ‘There’s a new state. Some say you will find happiness there.’ Communication is more context than content, therefore, the message of a new state where there will be happiness can’t be more topical coming at a time when the issue of state creation is attracting every attention at the national assembly. In the subconscious of Nigerians, the need for a good life comes tops even as they strive for a better tomorrow, hoping for the best as they refresh their hopes, however hopeless things look, with a cold bottle of Coca-Cola. No wonder they are the happiest people on earth.
When coke finally opened the happiness bottle, what dripped out was cash and other amazing prizes. It was at this point that it became clear that coke was using the promo to promote the sales figures for the quarter and the year. Remember, we are in a rainy season when demand is usually low.
In all sincerity it’s not a bad thing to do. Again, the question is: can a brand really stand for something? Can it balance its interest with ambition? Not everything in life that counts can be counted. In many places brands are, they should be here for good. Here for the long run.

For a big brand like Coke, in a big market like Nigeria , on a big anniversary as golden as ours, the Coca Cola brand, in the opinion of this column, should have done a little more. Not for today but for tomorrow. For instance, Pepsi didn’t attend the super bowl this year. Neither did they do a big promo. They set up www.refresheverything.com where they called on people to post good things they would love to do to make their community better. The social initiative with the highest votes would get a vote from the Pepsi brand.
Bringing it closer home, MTN Botswana, as part of the brand’s commitment towards creating a lasting legacy in the year the FIFA World Cup came toAfrica, ran a promo and the winner was given a Y’ello duplex. This effort created mega-excitement and delivered double returns on investment.
Its high time brands embraced social marketing in brand building efforts. Imagine Coca Cola creating a mini neighbourhood called Coke Estate or Happiness Avenue where 10 lucky winners in the Open Up Happiness promo would win mini flats in the year Nigeria clocks 50. These winners would have gotten the chance to live together forever as one big happy family in a country where fifty year old men jostle for the chairmanship of the tenants association!
That would have truly created an eSTATE where people would find lasting happiness.

Babatunde Adebola is creativity manager with a DDB, Lagos. He can be reached at07038619014 or adebola_baba@yahoo.com or followed on twitter at: underscorebaba

Gala: Complacency or Just Plain Snobbish?

m2 — Mon, 06 Sep 2010 17:43:04 +0000

O’Lekan Babatunde
Imagine the sheer popularity and ‘weight’ of Coca Cola – the world’s number 1 brand. The unlearned in marketing would say the owners of this iconic brand are just wasting money by continually advertising an already popular brand which is also making money. Whereas, marketing egg-heads for the brand both in Atlanta , Nigeria and the world over would say they want to ensure that the brand’s communication is right in the face of the consumer year in, year out.
Stories have been told about the ubiquity of Coca Cola advertising even in the remotest parts of the country pre independence. The story has not changed, rather the reach and frequency is increasing. Such is the story of a typical brand. It’s about consistency.
A monopoly can afford to be complacent without grave consequences to its market share. A brand in a highly competitive market space continues to defend and enhance its market dominance by making concerted efforts to maintain leadership. For this player, marketing is warfare. So what does one say about a brand whose market is getting hotter by the day and yet, the brand seems to be consumed in its past glory.
Rising through the 60’s, 70’s and 80’s without serious competition, Gala witnessed a meteoric rise and dominated its market segment without much challenge to its leadership. In the process, it gained generic status in the sausage roll market. A few billboards, some radio commercials and sporadic TV slots were the way to go even on those occasions that the brand owners decided to leisurely repackage the brand. There was limited market pressure, if any, worthy of note.
A few years back, however, market dynamics in the sausage roll segment began to witness a change. More virile competition especially from multinational conglomerates either entered the business or introduced new products or repackaged a previously unsuccessful one. Today, the market has Chopsy, Bigi, Meaty and more, all fiercely contesting market space with Gala.
In a show of pro-activeness which seems flippant now, Gala embarked on a brand relaunch in the last quarter of 2008. Speaking at the event and justifiably too, the group managing director, UAC Plc (owners of Gala), Larry Ettah, prompted by the brand’s impressive market achievements over the years said, ‘For Gala to remain an undisputed leader and also maintain a commanding presence in the market for almost half a century speaks not only of the brand heritage but also of the brand’s continuous fulfilment of its promises to the consumers.’ But is this true of the brand today?
Ettah’s compatriot, Chris Adedipe, had also observed at the same event that since trends evolve from the dynamics of human actions, ‘Brands that are alive to their responsibilities recognize that trend means flowing with the tide in human development in order to get the best results.’ But, having a brand around for a long period of time has its own baggage; consumers may begin to take it for granted or brand customers may begin to take consumers for granted. Adedipe said as much in an earlier interview.
As a keen market observer, ShopFloor holds that most consumers have not taken the Gala brand for granted. There is still some demonstration of empathy as it is still the market leader. But I strongly believe the latter case applies – consumers are being taken for granted by the brand owners. This situation may have stemmed from its enviable position in the market but sooner than later, competition will bear out on the import of never falling into complacency. For instance, since the lackluster promo that heralded the new packaging, the brand has more or less distanced itself from the market.
It is possible that a brand may deliberately choose to be snobbish especially if it operates in a seller’s market. Yes, the company is selling tonnes of sausage rolls every day in traffic, you may argue, so what other kind of advertising or related stuff does the brand require more than this? But hey, it sure needs more. What is the brand promise for instance? The population of brand loyalists is being depleted mostly by age. The competition is making this imperative now more than ever before.
Being one of the cash cows of the UACN group, every three years or so, the Gala business is pitched alongside other businesses in the group in its multi-business pitch. However, nothing much happen on the brand except good selling! At the other extreme of the market where its arch competitors operate, market and road storms, sampling, radio commercials, consumer promos and other experiential activities happen every day to redraw the market graphs.
Part of the last relaunch objective was to create ‘excitement around the brand by developing a trendier packaging.’ One would doubt if this was achieved in view of what presently obtains in the market. Some even say the former packaging was crisper and a lot more attractive.
Bearing in mind the verve and aggressive marketing deployed by the younger players, one may freely advise that the leader needs to assert itself in more ways than one. A more enhanced packaging, creating experience around the brand and strategic brand communication may be some of the ways to stem the current drift into marketing complacency or unwitting snobbishness.

For comments/feedback on this column, email: babslekan01@yahoo.com or call 08033487815/08082477816

I Almost Ate Hair with Butterfield

m2 — Mon, 06 Sep 2010 17:37:11 +0000

I came back from church one night to face the stark reality that there was no soup at home. I had made up my mind to have semolina for dinner; not knowing that someone smarter had helped herself to the soup at home. Well, I resigned to fate and went outside to get myself a loaf of bread.
When I got to the seller, I saw an array of bread and as usual made for Butterfield, with the assurance that they are hygienically better than the ones popularly called Agegebread. I did not buy any spread because I wanted to take coke. When the boy I sent to buy me coke took time in coming back, I pounced on the bread raw.
I had not taken up to three slices when I took bites that seemed to have a string attached to it with the one in my hand. Being a sensitive person, I slowly regurgitated the one in my mouth and tried to separate them to see what was actually causing the pulling. Luckily for me, I saw two strands of hair; very long. Immediately, I lost my appetite. I threw the rest of the read away.
I just thank God that I did not buy a spread because it would have covered up hair and I would have swallowed hair with the feeling that I was taken a very good product.

PHCN Forced Me to Pay Meter Maintenance Charges

m2 — Mon, 06 Sep 2010 17:32:36 +0000

When I moved to Anthony Village in Maryland area of Lagos and discovered that the house I moved into uses pre paid meter, I heaved a sigh of relief. ‘At last incessant palaver with PHCN has been reduced to the barest minimum, all I need do is recharge my meter and I’m ok,’ I thought. But how wrong I was when PHCN came with another surprise…meter maintenance charge.
Initially, I had thought that somewhere along the line I may have need of this service or maybe they would come for routine checks so I never protested. But to my surprise throughout that first month no PHCN official called to say hello not to mention checking my meter for any possible fault, although there was no issue with power supply anyway except for the general occasional black out. After that month, I decided it would be better to buy credit to last me a while instead of recharging every month and bought enough to last me four months.
To my chagrin, after this expired and I went to buy more I was asked to pay maintenance charge for the four months that I did not show up at their office and the amount in question was higher than the actual money I needed to recharge. When I protested, they refused to accept my money for recharge and threatened to disconnect me if I did not comply.
I feel pained that PHCN does nothing to justify the maintenance charges and my several complaints to the Ikeja centre is yet to yield any positive response; I am still paying.

Ugboja O.
Anthony Village,
Maryland, Lagos.

‘Netcom Gives Less Value for Money’

m2 — Mon, 06 Sep 2010 17:30:52 +0000

After paying N160, 000 as monthly bill for internet services, one should at least hope to get minimal value. But that would not be for Netcom Nigeria Limited, an internet service provider company.
We are supposed to enjoy 300 megabyte per second (mbps) based on our subscription with Netcom. But barely six months following subscription, our internet speed fell to less than 30 percent of what we bargained.
For a very long time, the snail’s pace at which the server operated became a subject of worry to everybody in our office. Then we ran out of patience and started making repeated phone calls to their office. But the young man who was supposed to be attending to us would neither answer nor return our calls.
We persisted, sending him SMS messages demanding that he acts fast and save us the agony of spending unnecessary hours on a few minutes of official tasks due to the sluggish server. The ‘ISP expert’ responded that we place too much load on the server hence its slowness. We explained that the experience was the same even when only one out of the 30 staff was connected to the internet but he would not agree with us.
I decided to find out the speed at which we had been operating and my findings on www.speedtest.net, a well recognized website that measures internet speed around the world, indicated that we were on 5 mbps. I brought this to the attention of some of our staff and requested the Netcom staff to give us our speed rating. Surprisingly, he sent us an obviously doctored report via e-mail stating that we were operating at the agreed 300 mbps.
We are still waiting for him to come and prove his claims in our office. Even as I write this piece, we still grapple with our day to day official duties on less than 10 mbps.

Godwin Akpata
Oregun, Ikeja

Nigerian Police Denies Confiscating My Identity Card

m2 — Mon, 06 Sep 2010 17:28:43 +0000

I used to take the widely held believe that the Nigeria police can spring unbelievable surprises at the people they are supposed to be protecting with a pinch of salt until it happened to me.
On a fateful Friday night, I was heading home to meet with my family after a hectic day’s job. It was exactly 10 pm and I knew there would be no point waiting for a motorcycle to convey me from Toyin street to 7 Up, Oregun because bikes are not allowed to ply that axis beyong 9 pm so I decided to trek to 7 Up, en route Opebi Link since I did not have enough money on me to ride on a taxi.
The recurrent premonition I had about any possible hazard on my way home was an encounter with marauders. But my intuition proved me wrong. Rather than running into some gangsters who occasionally rove around Ikeja metropolis snatching ladies handbags and people’s lap tops, I was accosted by the Nigerian police at exactly Opebi/Oregun link.
A young police officer halted me to identify myself at the said spot and I did just as he said. Having handed my ID card to him I expected him to return same to me after perusal. But the officer whom I mistakenly reposed my trust and confidence for public safety proved me wrong. He smartly concealed my company ID card and asked another officer to interrogate me.
“That man does not have an identity. He looks suspicious,” he says beckoning his colleague to come and search me.
Amazed and lost for words, I asked the new interrogator to obtain my identity from his colleague. But the officer denied taking anything from me.
After a long period of frayed tempers, their squad leader called me aside and had a chat with me after which he ordered the mischievous officer to give me my ID card.
By the time I retrieved my ID, it was too late to go to Ibafon and I went back and passed the night in the office but my wife and children were panicked and heartbroken because I was communicating my ordeal with the police to them during the incident.

Obafemi Lijadu
Ikeja, Lagos

Coca Cola Runs Promo with Old Products

m2 — Mon, 30 Aug 2010 15:57:20 +0000

My notion of consumer promotion is prior to the running of the proper promo, the company concerned should saddle itself with the responsibility of stocking shop shelves with the promo brands serially numbered. But the ongoing Coca Cola ‘Open for Happiness’ consumer promo seems to be getting it wrong this time.
Even as a loyal cola drinker, especially among peers, I always increase my awareness whenever any promo is going on. Contrary to what I had been used to, all the Cola products my friends and I drank in our neighborhood (Gbagada) within the first week of the promo were old stocks. It was so bad that I drank three bottles of Fanta at a go just to find out if there would be any crown cork that could indicate the promo. But there was none. My friends drank two bottles Coke each found nothing on the crown corks to show that that badge was for the promo.
I consider it a disservice to me as a consumer and suggest Coca Cola should take urgent steps to correct this anomaly as it was capable of tainting its strong reputation in Nigeria.

Onyinyechi Igwe
Gbagada, Lagos

Biased PHCN Boss

m2 — Mon, 30 Aug 2010 15:55:37 +0000

I like to share an unpleasant encounter I had last year with the PHCN district manager at Onipan area of Lagos State in your esteemed magazine.
I live at No. 6, Isaac Jones Street , Fadeyi. When I moved in to my current apartment, I met six other tenants who shared the same PHCN billing metre with the former occupant. They told me he was indebted before moving out and I had to clear the debt. I obliged to make my stay a happy one.
I met a practice where my cotenants and I shared the electricity bill. One of us had the responsibility of remitting the money to PHCN. Unknown to us, the man in charge was collecting the money without paying it in. You may call it stupidity on our part because we weren’t asking for evidence of payment neither were we crosschecking subsequent bills. One day, the bill came in and we discovered that we were indebted to the tune of 80,000 naira. We were shocked.
Upon this discovery, the other tenants decided to migrate to another metre, an alternative I couldn’t take because the original metre was on my wall. I was left with the 80,000 naira debt alone. Meanwhile the fraudster behind the whole problem had packed out by the time the truth came to light.
I went to the PHCN district office at Onipan to complain, explaining that the other tenants had removed themselves from the metre leaving me to pay the whole debt but the district manager was nonchalant about the whole matter. Instead, she made my family live in total darkness for eight months before the issue was finally resolved.

Godwin Azunna
Fadeyi, Lagos

We Got Our Phone Back!

m2 — Mon, 30 Aug 2010 15:54:12 +0000

My father is the kind of person who believes that one cannot get anything genuine unless it is bought in an accredited distributor shop. So, he would not go to the market to purchase his electronics, preferring instead to make his purchases from accredited dealers.
On this particular day, he wanted a phone and asked me to help him with market checks after which he bought the particular phone he wanted from the Samsung Phone Centre at Ojota. The phone came with a year guarantee. On getting home, the phone started giving problems and I had to take it back to the centre the following day.
I explained the problem to the person I met, laying emphasis on the one year guarantee. The staff immediately took the phone from me, checked to ensure that it had not been changed and told me it would be sent back to their factory before another one would be given to me. We thought the handset had ‘entered voicemail’ after waiting for some timefor Samsung’s call.
However, after two months, my phone rang one day and I was asked to come to the Samsung office to take delivery of another phone in replacement! I thought the person must have called me in error as I was no longer thinking about the handset, but I decided to go all the same. Alas, when I got there, a brand new phone, of the same model was presented to me with an apology for the inconveniences caused. To say I was amazed would be an understatement. It was indeed a pleasant surprise.

Toyin Omolaja
Oko Oba, Agege Lagos.