When Sales Hit a Wall

My managed-care consulting firm has reached a complete plateau. Costs are eating up profits, and we're trying to increase sales with word of mouth, newsletters, and direct marketing. But the return is only 1% to 2%. It's confusing because 73% of our customers renew their memberships.

Lino Magnano, Australian CompHealth
Melbourne, Australia

New friends are silver and old ones gold, the ditty tells us, and the same goes for customers. The 73% of clients who re-up with you each year should be mined for ideas, promotion, and bucks. Ask your client base how to be the best you can be. Do your products need buffing? Servicewise, are you missing a trick? How can you make your clients' lives easier, breezier, more worth living? Act on their suggestions, and then use the results both to upsell and to woo new business. Also, don't be shy about asking for referrals. That worked for Rick Skidmore, CEO of Timberlane Woodcrafters in North Wales, Pa. When Skidmore started his company, 30% of new business came from a referral-based direct-mail program. "Satisfied customers are almost always willing to spread the news," Skidmore says. "They will be able to act as apostles for your company, something you yourself can never do as well." Of course, you may lack new business because there's none to be had. If you keep coming up dry, consider drilling in a new patch, suggests Ford Harding, author of three books on selling professional services. "Find someone in your current office who has an entrepreneurial drive," Harding says, "and build a new office where you have low penetration. Your network has to be growing continually."

Breaking Into Retail

I have a small skin care business. How can I find an independent rep to distribute my products in stores?

Leslie Przymusinsk, Leslie P. Cosmetics
Battle Creek, Mich.

Who can better represent your products: the person who conceived, designed, and developed them? Or some joe who thinks Vaseline is a premium moisturizer? Approaching stores is one battle you should fight yourself. Target any business that sells cosmetics: boutiques, spas, drugstores. Invitations will not be forthcoming, so make those calls, rap on those doors. Take a page from Sandy Lerner who, after founding cosmetics company Urban Decay, simply picked up the phone and started cold-calling stores. Her funky-hued lipsticks and nail polish colored the world of a buyer for Nordstrom; a few months later she had her own counter there. Also, you can plunk yourself down in the industry crossroads by attending a trade show, such as Cosmoprof in Las Vegas. You'll find yourself among retailers, distributors, and other manufacturers. No need to rent a booth. Just bring plenty of business cards, samples, and the salesperson's most powerful weapon: charm.

Generating Web Traffic

My English-language school has a website, but it cannot be located via keyword searches. What can I do to fine-tune? Do I have to pay Yahoo and Google to get moved up their lists?

Bob Clark, English Spoken Aqui
Manassas, Va.

You don't have to pay for search engines' attention, but you do have to stand up and wave your arms a little. Search engines whiz by one-page sites like TV viewers past local cable-access channels. So if you want to be seen, bulk up to at least three pages, says Jill Whalen, owner of HighRankings.com, a search optimization firm. Words matter too: If searchers are looking for information about "languages," you shouldn't be nattering on about "tongues." Online research tools can zero in on keywords that generate hits. Wordtracker.com, for example, helps companies identify the most popular search terms in their industries. Once you know the words, use 'em. Start with at least 250 words of "keyword-rich text" and a "descriptive title tag" (it's that thing at the top of a browser that tells Web surfers where they are). Those will help create links with other sites and help your site get found by Google, Yahoo, and their ilk. "If credible and popular pages are linking to your site," Whalen says, "that tells the search engine that this must be a decent site."

Of course, there are some things money can buy; so throwing some at the search engines isn't a bad idea. Danny Sullivan, editor of SearchEngineWatch.com, likens free search hits to PR and paid keywords to advertising. "The balance depends on the company," he says, "but you should definitely have a balance."

Stumped by a thorny business problem? Let Inc. help. Send your questions to AskInc@inc.com. We'll consult with experienced entrepreneurs and savvy advisers, folks who've been where you are and figured out what works and what doesn't. If you don't like what we have to say -- well, you can tell us that, too.

Published on: Aug 1, 2004