Don’t Let Your Ego Limit the Profitability of Your Small Business

 

 

The other day I was having a discussion with a small business owner. He explained to me how his sales of his retail store were down. I asked him this question. What are you doing to promote your business? He told me he was doing quite a bit of advertising on social media and some local magazine ads. I asked him what kind of a response he was getting and he replied “not very good.”

I explained to him that according to marketing experts an industry standard and proven formula for advertising your business is 10% to the universe, that is, to anybody and everybody. This would take the form of advertising social media, magazines, electronic outdoor bill boards, or on radio, anywhere you were just blindly advertising to the masses.

Another 30% of your advertising dollar should to go to a qualified prospect list. This could take the form of a mailing, or an email blast that would target potential customers for your particular business.

The final 60% of your advertising dollar should go to your present and past client base. That’s right, to the people already buying from you. It makes sense. These are the people who know, like, and trust you. They will buy again from company if your stay connected to do them.

I then asked him if he had a 12 month marketing plan. He said, “Not really, I just look around and see where I want to do some promotions and do it.” I asked “Any particular reason why you do it this way?” He smugly replied, “it’s just the way I do it.”

Here is an excellent example of how a small business owner’s ego can get in the way of running a profitable and successful business. Like I often ask my clients, “Do you want to be right, or do you want to be profitable.”

Here is the take away from this illustration. Either way, you can be an example to other business owners. You can be a good example of a company that has a proven plan and works it or you can serve as a bad example of a company that runs on ego and not business savy.

I don’t know of any business owners who are able to successfully read the minds of their customers and clients. Yet, day in and day out, so many of them waste millions of dollars spending money on useless advertising aimed at reaching this mythical customer or client.

It is true that in order to have a successful business you must believe in yourself and take calculated risks. But don’t let your ego get so big that it shuts off your ability to learn from others.

Like the old saying goes, “The mind is like a parachute. It works better when it stays open.”

Please contact me with your questions on this topic at tom@tomborg.com

By Tom Borg ©All rights reserved

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Tom Borg


My name is Tom Borg. I am a business expert who works with small and mid-size companies to effectively and profitably improve customer acquisition and retention. I help these businesses through his use of my consulting, speaking, training and coaching. To ask me a question or to hire me, please contact me at: (734) 404-5909 or email me at: tom@tomborg.com or visit my website at: www.tomborgconsulting.com

Tom Borg