Red Frog, Inc.

(from "How to Profit in a Down Economy" by Josh Barinstein, Copyright 2004)

Diversifying your customer base relates to thinking outside the box. You'll hear several recurring themes today. It means looking at how you can redefine, perhaps, your customers, expand on how and what that definition is. The bottom line is that you don't, as I said before, want to find yourself stuck in any one industry or market. When times are down you may lose market share from a certain sector that suddenly chooses to stop purchasing or purchase less. Or something in their psychology, as was pointed out, where they're suddenly not doing what they used to. This can mean great pain for a company.

We all know the power of referrals, I believe. Referrals, if you think in your own personal life, when you refer someone or when someone refers someone to you, they carry with them the trust that one person has for another. I trust your opinion, therefore there's an inherent seal of approval to at least find out what that person is recommending. You want to capitalize on this as much as possible during these times and expand on your customer base. One effective way is to create a mailer. Send a mailer to your database where you're asking for feedback, you're inviting people to reply back on these easy to fill out reply cards that you supply. And for every recommendation they send, for every colleague they've recommended you to, you send them some sort of reward. And you want to keep this very simple. You don't want to confuse anybody, you know, a clean card that they can easily fill out. If people love what you do, hopefully that's the case and they love your quality and customer support, they'll be more than glad to do this. If you are not currently getting referrals, you can generate them in such a way, and for pennies. So this is not an expensive way to expand out.

Real quick, in terms of direct marketing, which will show up later on, this is a form of response marketing, you're asking to get something back from people. You should seriously think about exploiting direct marketing now to garner new business in any of the markets you think you can go after. There was a study done by Zenith Media, where they state that direct marketing usually prospers in a downturn. What happens is that most ad spending drops, in every major media just about, except for direct marketing, surprisingly enough, which continues to grow big. Why, you might be asking? Well, direct marketing, like the example given a moment ago, is measurable. You get something back from people, and you in turn usually have a rate of return, so you can measure what happened. So, I highly recommend exploring that for ways to expand your client base and beyond.

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Josh Barinstein is President of Red Frog, Inc., the Southern California ad agency that provides worry-free experiences and powerful results in the areas of Marketing, Print design, and Web/CD-ROM development.

Learn more at www.RedFrogInc.com or by calling 888-955-0550.

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