Make it Easy to Spend Money With You

Why do some businesses make it so hard to spend money with you? I recently returned from lecturing in the Dallas/Fort Worth area at a clown convention. Now, I have to admit, this was my first clown convention and it is quite a site to see a room FULL of adults with white faces, orange hair, and rainbow colored clothes, but for most of the convention they were just plain old folks.

Okay, maybe there were some who were a little bit weirder than normal, but not as weird as some of the magicians' conferences I've attended. And no where NEAR as strange as some of my family reunions, but that's another topic.

The point is that there were some really good questions they brought up. One of them was about contracts and deposits.

Performers (and this seems to be true for clowns, magicians, musicians, jugglers, vents, and almost any other performing artist group I've talked to) seem to have a phobia about having people cancel gigs on them. So to protect themselves they want to have customers sign contracts and/or submit non-refundable security deposits.

The problems I have with this are multiple. First, performers are some of the flakiest business people on the planet. I've come to believe that the greatest threat to most performers' business is their own apathy and carelessness. The client has a much greater (and statistically more justified) fear of you not showing up than you have of them canceling for no reason at the last minute.

Secondly, unless you make it very easy to pay a deposit (such as accepting credit cards AND PayPal) then you just create one additional obstacle for your customers to traverse in order to work with you.

Thirdly, I wonder if anyone has ever, or would ever sue a birthday party mom over a cancelled party. I certainly wouldn't. I wouldn't sue a school or library that cancelled. And if I'm not going to sue, why would I create a contract anyway?

Lastly, you put a huge hindrance on working with certain types of customers and clients. Some of the people who are in charge of hiring you are not allowed to enter into written agreements and so the authorizations (and thus the buying decision) is then passed on to someone higher up who might not have the same priorities or relationship as the person who really wants you.

I'm not saying that deposits are bad or that you shouldn't use contracts. I even believe that having customers work a little bit to get your business isn't a bad thing either. But I do think that if you want to grow you business you should strive to make it easy for them to spend with you.

Please don't e-mail me with your thoughts on why you do or don't use contracts. I would love to hear other opinions but this is a BLOG. That means, if you have an opinion, click the word "comments" below this posting and post your own comment so that everyone can read it. You can do so anonymously.

When is Profit Bad?

Aside from money that is stolen or gained through fraud or deciet, is there any time that an honest, fair profit could be a bad thing?

I think there are at least three instances when I believe that a fair, honest profit is a bad thing and here they are:

1) When the profit is less than you could have earned doing something else more closely related to your core business. One of the biggest mistakes business owners make is failing to engage in their highest return activities. For me those high return activites are marketing and performing. That's why I don't get to post to this blog as much as I'd like to (even though this blog is a form of marketing in itself). When you spend hours working to build something that you could have bought for a few dollars, that is not a good investment of your time. You can say that it was profitable because you saved a few dollars, but if you could have spent that time in a higher return activity you would have earned even more.

This also happens when we work to please a client who drains our resources and cuts into our profits. When you have a customer who constantly haggles on price, demands that you stay longer hours, asks you to do things that you didn't originally agree to, you can either fulfill those requests or not, but recognize that additional work at lower pay is a lower value activity. You can make a profit, but you shouldn't aspire to cultivate clients like this.

2) A profit is bad if it is earned at the sacrifice of future profits. We shouldn't be doormats to our clients, but even worse is gouging them or taking advantage of them. If we fail to nurture our customers and clients they have no incentive to return and do business with us again. I would rather make a little bit less on this sale and know that I will keep the customer for at least a few more years than to worry about going out and finding a new customer to replace the one I abused. The local printer I work with inhereted the business from his father who still does business with MY father and now I do business with this same printer. He's not the cheapest, but he treats us fairly, holds our hands when we need it, and is always honest. I remember several occasions where he told me to go to another print shop who could do just as good a job at a cheaper price. He lost a sale, but he kept a customer for GENERATIONS!

3) A profit is bad if it is made at the expense of your integrity or happiness. While it is important to treat our customers with respect and dignity, it is equally important to treat ourselves with respect and dignity. If you have to do something that you aren't comfortable with, then the profit isn't good. And this doesn't have to be as nefarious as it might sound. If you are a birthday party performer who doesn't do balloon animals and a client wants you to do them, you can either learn to do them (not a bad option) or you can simply tell him that you are not able to do them and offer to find someone who can do that. But you needn't feel compelled to change your business model simply to please a client.

--Julian Franklin

What Was He THINKING!?!

People ask me how I have the ability to update two blogs every week (sometimes two or three times a week), write a monthly magazine column for The Linking Ring (the most widely distributed magic magazine on the planet), write another regular column for The Funny Paper, perform 700+ paid engagements each year, and still have time to lecture, write books, record audio products, host an annual conference, and all while vacationing at least 6-8 weeks each year.

The answer is that I am constantly thinking in terms of "articles" and occasionally I convince friends and business associates to keep their eyes and ears open as well. I train people in my group well.

So I have a guy who attended my Business Building Workshop last year who called me today to tell me about something that happened in a parking lot. He saw a truck with what seemed to be at least $2,000 worth of graphic design artwork on the vehicle. Graphic window tinting, custom paint job, the whole nine yards. It all promotes promotional items such as imprinted key chains, coozies, and monogrammed shirts.

So my man walks up to the guy and tells him he want some shirts monogrammed. My man hands him a card. The guy hands him some quality coozies, a few key chains, and a business card printed on a piece of perforated card stock.

What's wrong with this picture?

The guy tells my man that he's got $5,000+ of equipment (and starts talking threads per inch and some other criteria that no one outside of his industry has even the sleightest clue what he means), clearly has thousands invested in the graphic design work on his car, and then talks about the high quality of his work. But then seals the deal by handing my guy a pretend business card!

Professionally printed business cards are about $25 for 500. If you can't invest in your business what you would drop on a large pizza, then you have no business being in business.

I have a new thing I'm doing where I've spent thousands on nationwide advertising for those who want to do blue and gold scout banquets. I offer people the chance to buy in at $79 and I have guys who call, ask some questions, think about it, think some more, and eventually just drop it.

In my mind I'm thinking "It's $79. You spend more on cable television each and every month but you are worried about whether or not this will result in several thousand dollars worth or business or "just" several hundred. Stick your head back under the rock because I don't want people like you involved!"

Why would you run 25 miles of a marathon and then quit a mile and a half from the finish line?

Why spend so much money on your equipment, your car, your professional image and then destroy it with a home-made card that could have been produced in quantities of 500-1,000 for less than a tank of gas?

This is even MORE true for a guy who claims to offer the ability to promote yourself in a professional way.

So here is the question for YOU: What corners are you cutting that simply shouldn't be cut in your line of work? If you are a trade show performer then your clothes need to be top of the line. If you are a clown, maybe not. But if you are a clown, you better have a very funny web site and answering machine.

Please don't spend thousands creating one impression and then destroy it trying to save $50.

--Julian Franklin

Customers Don't Care

In one of my writings I made the comment that customers don't really care about your problems. They don't want to hear about your excuses. They are not interested in your woes.

It doesn't make them callous or heatless, it just means that when a person or company hires someone to provide entertainment, that is really all they want to get out of the transaction. They usually aren't looking to get wrapped up in your soap opera.

A birthday party mother wants to celebrate her child's birthday, not mourn the break-up of her kid's magician. A corporate event planner wants to pull off a fun evening for the group and isn't the least bit interested in hearing about your impending divorce and how your soon-to-be-ex caused you to show up thirty minutes late. They just want their show and they want it with a smile.

This point was really brought home to me when a friend of mine from Georgia called recently to tell me about a mutual friend of ours who heard, quite unexpectedly that his wife had contracted cancer and it was in the later stages. They gave her less than a month to wrap things up. It turned out that was an over-estimate and she just passed away yesterday.

So several professional performers in the Atlanta area contacted the performer and agreed to not only cover his engagements, but to allow him to keep the money from the shows. When he was told on Thursday that his wife would probably not last through the weekend he called them up on their offer.

So this friend of mine called the clients and explained the situation and informed them that rather than abandon them, he would be filling in for the party, honoring the previously agreed upon fee.

And here is where it gets weird, even for someone as jaded as I can sometimes be.

One of the clients asked if she was going to get a discount for the show since she had contracted for two performers (the husband and wife worked as a team). My friend told her that he normally charged more than the agreed upon fee, but that he was honoring it. Still, rather than fight about it, he agreed to lower the fee to about half of what he normally performs for, with the intention of pulling the difference from his own pocket so that the original performer would not know about it.

In other words, my buddy is going to go in, do a show with no compensation and then reach into his own pocket and pull out another $50 to fill in the shortcoming of this woman who wants to re-negotiate a fee with a man who is watching his wife and business partner die in his arms.

But it gets worse. As he's driving to the show he gets word that his friend's wife has lost her fight. But the show must go on and he arrives at the house, does the show to the delight of the kids in attendance.

After my friend finishes the show the lady hands him an envelope with his payment. When he got to the car and opened the envelope it contained a $20 bill. He went back up to the house and asked what it was.

"That's your tip. You did a fantastic job."

"Thank you. What about the payment?"

"I'm not paying. I contracted for a clown and you weren't a clown, you did a magic show."

"I know. I'm sorry. The clown you hired just died of cancer. Of course, they didn't have to provide anything at all. They could have just called and told you they weren't showing up. But they tried. I'm sorry she picked such an inconvenient time to die. As you can imagine this is even more troubling for her husband than it is for you. But why don't you keep this money, you obviously need it more than I do."

"Julian," he told me later, "I had to leave because I was afraid if I stayed even a minute longer I would have ended up in jail. I was so disgusted with this lady's complete disregard for what had just happened."

And it gets even worse.

The lady actually got on the phone and called the original performer to leave a message on his answering machine to tell him how unhappy she was with the service.

Just what a man who has lost his wife needs to deal with.

In memory of Gleeka the Clown. Our hearts, thoughts, and prayers are with you Aragorn.

BLOG vs. WOM

I subscribe to a lot of marketing newsletters and got one today from a group I really like. But the gist of the article had, what I consider a flawed premise about how Word of Mouth Marketing (WOM) differs from concepts like blogging. Here's a direct quote from the article to let you know where I'm coming from...

"...The vast majority of marketers report interest in WOM, more than are interested in podcasts, RSS and even blogs, according to research released this summer by Epsilon..."

Now, my thought is that blogging IS a form of WOM. That is, since WOM is about getting others to talk about you, creating an active, interesting, compelling blog is a major componenet of a WOM campaign.

How can you contemplate a WOM component that exists by itself?

If you do you are casting the entire thing into the great beyond and hoping that the word that is spread about you is good.

To be sure, a WOM campaign MUST begin with quality product and exceptional service, but if that is where it ends, then you are missing a huge boat. You have to remind, prompt, and constantly reappear in the lives of your customers and clients.

Blogging is ONE way to do this. Not the only way, maybe not even the best way, but if you eliminate it as being something OTHER than a component in a WOM campaign, then you sell it short.

That is not to say that blogging is ONLY about WOM either. If it is, then it becomes nothing more than a running advertisement that no one wants to listen to. You have to create something worthwhile, which brings us back to the original premise of having a good product and great service.

I hope you like this blog. If so, come back soon.

And tell a friend, too.

Dolly's Dixie $tampede (part 2)

Last post was about how Dolly Parton manages to create an experience at The Dixie Stampede that has visitors not only wanting to go back, but telling everyone they know about it in a way that makes the listener not only want to go there as well, but even makes them want to tell OTHERS about the experience! This is "viral marketing" at it's best.

But Dolly is no dummy. She knows not only how to get people in the door, but also how to extract money once they get there. The stadium seats just under 1,100 guests. The Friday we went there were 3 sold-out showings. Most nights there are "only" 2. The tickets are about $35 each, you can do the math.

When you walk into the place you cannot enter the dining room until you get your picture taken. If you have a young child they will shoot a picture of the child alone as well as with the adults. You don't have to buy anything, but you get your picture taken anyway. You are standing on a green back ground which let us know that we were going to be superimposed onto some scenary other than the entryway to The Dixie Stampede.

Then you enter an area where there is a "pre-show" going on. In this room you can buy peanuts and drinks. The drinks are served in little plastic boots which makes the kids BEG for them. They could care less if you served them water, they want that little plastic boot drinking cup. More than half the patrons had drinks or peanuts or both. I have no idea how much the drinks cost since there were no prices posted, even on the drink menu! By the time you waited in line to ask how much, you were already mentally committed to buying. It was a very clever psychological tactic.

Now, you have to also remember that you have to buy your tickets in advance. This means that when you come through the door, most people are mentally starting at zero. The tickets have already been bought and paid for at least 5 or 6 hours before, so when a family of four comes in, they feel like they haven't even started, even though they are already $140 down before their picture is taken. That's another very important point, and they are able to do it over and over again throughout the evening.

This breaks the pain of payment down into more manageable chunks. If you told them it was $250 for the evening families might balk. But if you get a little here and a little there, $20-50 at a time, it's almost painless.

So you first come in and see the pre-show, buy drinks and peanuts and then, after a while the pre-show ends and everyone is herded into the stadium. Totally different room, and another psychological balance sheet erasure.

Now, the show itself is fun and they do a great job of getting everyone involved by stomping their feet, yelling and shouting for their "team" etc. There are so many great psychological principles wound up in this that I can't even begin to list them all, but "being a part of something big" and "euphoria from endorphins released during yelling and stomping" are two big ones.

Now, everyone is happy, they want to remember this fantastic experience and along come these people bringing photo folders with your pictures in them. The pictures are $10 each but you have to buy them in sets of 2.

So there we are standing in front of the great Smokey Mountains from a vantage point we've never actually been to, and another one of us standing in front of the backdrop used in the show we just saw. I really didn't want the picture but everyone else was buying them as fast as they could whip out their twenties. My wife insisted on getting one, too. There's a few lessons in that last sentence that I won't go into.

The real genius of this is making the kid(s) stand separate from the adults for at least one shot when taking the photos. With the nuclear families today, there may be a parent who doesn't want a picture of the other adults in the child's life, but does want one of the child. When grand parents take their grandkids out I can easily see them buying one set of pictures for themselves and the other set for the kids to take home to mom and dad.

Smart.

Now it is time to leave and so we file out slowly. Every single person leaves through the same exit. It's the exit at the OTHER end of the gift store. So you have to take these kids who are high on energy and adrenaline and wheel them through a store full of toy horses, t-shirts, and all manner of glittery treasures.

Good luck getting through that gauntlet without lightening your wallet. Besides, it was a complete change of room, feel, lighting, and staff. It was like being in a totally different place and so without being aware of it, you tended to sort of "start back at zero" again.

I'm sure there were other "money-getting" strategies and tactics at work that I missed. I guess I'll have to go back to experience it again in order to catch them all. I'll see how many people I can get to go with me.

Dolly's Dixie $tampede

Several months ago my wife was watching an interview of Dolly Parton and liked it so much she gave me the synopsis (I don't watch very much TV). In the interview Dolly apparently did a fantastic job of coming across as the perfect blend of simple country girl and shrewed business mogul. It seemed like a contradiction, but my wife assured me, Dolly pulls it off with perfection. So, on our most recent trip to Pigeon Forge, Tenn. to attend the annual KIDabra Conference where I've been a lecturer every year for the past few years, my wife decided that we would eat dinner at Dolly Parton's Dixie Stampede. It was quite an experience, and an interesting lesson in "money getting".

First of all is the uniqueness of the experience. Unique means "One of a kind", and Dixie Stampede fits the bill on at least two different levels.

On one level it is a dining experience like no other. You eat in an indoor, air-conditioned stadium while below are horse races, wagon races, pig races, ostrich races (with human riders!). The food is served in a way probably unlike any meal you've eaten before (more on that later) and you are seated to either cheer for The North or The South as the entire experience is sold as an opportunity to settle the Civil War dispute once and for all.

The very premise qualified as "one of a kind" but it goes even deeper when you realize that, since the entire evening is a "contest" between the two sides, with points being earned by audience members on stick horses, as well as staff members riding on horseback, and even by racing pigs, so that each show ends up a little differently. Some times The South wins, sometimes The North. Sometimes it is neck-and-neck and sometimes it is a landslide. This makes even repeat trips a new experience and truly every single meal there is "unique".

The food is served with no silverware. The soup bowls have handles on the side so you can sip it. The main course consists of an entire Cornish hen, half of a baked potato served as a plain "wedge" so you can eat it with your hands, corn on the cob, and for desert you get a pastry. No table ware to wash, but I think the real brilliance is not in the savings from replacing lifted tableware or the soap saved from not having to wash dishes. The real value is in the marketing that becomes "viral" as people tell their friends and family about eating an entire meal with their hands.

That's a story that people remember and it is something that is different enough to make listeners want to learn more, and even want to repeat to others. That's the real essense of "viral marketing", not sending SPAM e-mail.

Okay, that's all I'm going to write about the Dixie Stampede in this post. Later this week I'll come back and share with you the real nitty-gritty. I'll share with you the various vacuum hoses they had invisibly tucked into everyone's wallet and how they were able to extract a great deal of money that Friday afternoon and leave everyone in attendance smiling about the whole thing.