Maximise Profitability – Our Top Tips

In yesterday’s post we gave you some top tips on how to increase profitability during these difficult economic times. Today, we look at how the strategies many big brands’s such as Tesco are employing and give you some advice on how they can work for your small business or recent company formation.
1. Get to the point
In a recession many companies loose a proportion of their existing consumer base to their competitors. This is mainly as a consequence of aggressive price cutting. One of the main ways to avoid this is to find some ways to increase customer loyalty. Point systems have become commonplace in the retail sector and many big brands such as Boots, British Airways and Tesco were early adopters to the scheme.According, to Marketing Consultant Ed Parish, “Point systems make the customer feel they are getting more value out of their shopping experience.”
Parish comments; “ While the trend for online discounting and voucher codes has accelerated recently, over use of this promotional strategy could do long term damage to your brand. A point system ,however, allows you to build equity in your brand while encouraging customers to maximize their existing spend and develop a long term relationship with your business.”
2. Samples and Trials
Due to current economic instability, many consumers look to brands that offer reassurance and stick to products they have already used. While, this is good for established brands, it can be very challenging for a recent company formation, or a brand try to launch a new product or service.
Matthew Williams, founder of Catalyst consultancy, offers staff training and team building services to businesses. However, he found the market was already quite saturated with people offering similar services. Therefore, instead of giving up or diversifying, he offered companies a free team building session in the hope they would commit to his services in the future.
“Initially, we sat down and established the companies we really wanted to work with from a commercial and reputation point of view. We then did some direct mail activity, sending out a promotion offering them a free trial of our services.” Says Williams. “The strategy was a complete success and resulted in two large contracts which have more than paid for the time spent on the ‘free’ trail
3. Approach a Big Brand
If you have a niche or specialized product or service, that has some correlation to the proposition of a large brand, approaching a big brand to resell your services may be a great way to raise your brand awareness and increase your reach and share of market voice.
8. Get your House in Order
As we have said many times before; you and the people who work for you, are your brand. In the current economic climate, where brands are constantly fighting for a share of an ever decreasing consumer spend, customers will not perserve with poor service or a negative brand experience – they will simply go elsewhere.
Therefore, it is vital that your team is motivated and share your passion you have for making sure your company emerges from the recession stronger than ever before.