(Part 1)

Many local businesses are turning to the Internet to market their products and services only to find a vast landscape of choices and options to filter through. The digital age and the Internet has certainly brought down barriers, lowered costs and developed new opportunities for small businesses to connect to their customers. However, the confusing landscape of Social Media, Search Engine Optimization, and Paid Online Advertising can all add up to the local business owner longing for the days of plain old Yellow Pages advertising.

Ironically, one of the simplest and oldest technologies of the Internet, Email is consistently winning favor by all businesses competing for consumer attention online. According to a 2008 study by the Direct Marketing Association, Email is used by over 79% of marketers surveyed, while postal direct mail is used by only 75.4% of marketers. And Forrester’s US Email Marketing Volume Forecast of 2008 estimates that the number of marketing emails sent by U.S. retailers and wholesalers this year will hit 158 billion and grow 63% to 258 billion in 2013.

With this type of popularity, why does it matter so much for the local small business? Each one of your customers that subscribes to your email list opens up a friendly and direct communication channel from which you can not only keep them coming back through your door but you can also gain valuable insight into your entire customer base.

Direct connection to your customers

The greatest business owners are the ones who directly communicate with their customers on a daily basis. You remember, the small family owned restaurant you visited as a kid where the owner was on a first name basis with every single customer. Not only was every patron of that restaurant a raving fan and forever loyal, but the owner was also a raving fan of his customers. He truly loved the people he took care of and did so with passion.

Of course times have changes and we can’t all be so intimate with our customer base. Even if you are, as your business grows, daily face to face communication becomes more difficult. Email of course helps to bridge the gap.

In fact, you may not even want to refer to email as a marketing method. Rather it is a method of conversing with your fans who you love.  Opening up this conversation channel not only allows you to keep yourself in the forefront of your customer’s mind, but allows you to be their friend, their confidant, their ‘buddy’ even when they don’t really even know you. As long as you can keep a real person to person conversation going within your email campaigns, you can always have a one on one relationship with your customers, no matter how large your business becomes.

Subscribers are a statistical sample of your entire customer base

What if you could know exactly what to sell by asking your customers exactly what they want before you ever actually sell it? Many large businesses spend millions of dollars each year on market research and testing. The wonderful fact is that small businesses can learn immense amounts of information from their own customer base through email marketing using coupons, promotions and surveys.

Coupons and Discounts: Coupons have been one of the most powerful forms of market research ever since Claude Hopkins perfected his methods back in the early 20th century. One of the greatest marketing books ever is “Scientific Advertising” by Claude Hopkins, and I highly recommend it to all small business owners and marketers.

There is a wealth of knowledge to be gained from emailing coupons to your existing customers. The simplest form of research and testing is to run two or more campaigns and then compare your results by counting the coupons you receive back. For example, create two or more coupon campaigns to test what colors get more response, what words are more attractive or simply what offer is more appealing to your customers. Which one gets a better response, “Buy One Get One Free ” or “Get 50% Off”. Both may be the same to you, but one may be much more appealing to your customers and you need to know which one it is.

Sales and Specials: Next time you promote a sale or special on a large scale, spending thousands on multiple advertising mediums, wouldn’t you like to know beforehand whether or not it will be effective? Leveraging the use of your email campaigns you can again test different messages and approaches to see what gets the best response from your subscribers.

Get creative with your coupons and specials, there is a wealth of untapped knowledge that is out there for you, and if you are able to crack the codes that your competitors are ignoring then that just puts you ahead in the race.

Market Surveys: Surveys allow you the quickest and easiest way to find out your strengths, weaknesses, and overall market perception from your customer’s standpoint. The reason the old time restaurant owner who knows everyone by name is successful, is because he is able to gauge his customers interests and needs on a continuous basis.

Of course you can do the same thing but you can also get much more precise and thorough knowledge. Use a simple market survey to get general feedback that you would have otherwise never gotten because you never could or would ask a large enough sample base. Keep it simple; you could start quickly and easily by just asking a few questions in an email and ask everyone to answer by simply replying to the original email.

Real time feedback: Of course one of the most amazing and extraordinary benefits of all this modern technology is the swiftness of responses you can get. Gone are the days of long print and mail turnarounds. Send out a coupon and see it come back to your store within hours. Send out a survey of the next ice cream flavor you should carry and have an answer before your next supply order. Email an announcement for your weekend special and get those sales goals met before the end of the month. It doesn’t get more real-time and interactive than that!

Next Week Year: Part 2 – Getting referrals, word of mouth advertising, and putting a dollar value on each subscriber.