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The History | EquipmentFX

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The History | EquipmentFX

  1. 1. EquipmentFX… On Target Marketing Solutions
  2. 2. Who I Am  Steve Smith, Managing Partner, EquipmentFX  Former VP/GM of Johnson Machinery, a CAT dealer located on the West Coast  Experience at all levels, including: Equipment sales, operations management (parts, service, rentals), finance management
  3. 3. Who I Am cont…  2 Term Chairman of Hyster Dealer Marketing Council  Dealership studied as example of “What it’s like when it’s right”… NMHG Theme  Committed to research, application and elimination of wasted marketing spend and measuring returns
  4. 4. What I Do  Focus on practical marketing solutions using YOUR internal resources, outsourced vendors when necessary  Design Fortune 500 level sales and marketing systems without the cost or complexity, generate leads from every possible angle  Constantly ask “WHAT IF” questions
  5. 5. What I Do cont…  Research the competition  Help build a better service organization  Look at trends that affect us from a different perspective  Apply what makes sense in the most cost effective manner possible
  6. 6. Have You Ever…  Had month end panic attacks because orders weren’t predictable?  Had the “pit in the stomach” feeling of things being out of control?  Felt overwhelmed because change happens so fast we can’t keep up?
  7. 7. Me Too…  Here’s the brief story of my struggle:  Promoted to VP/GM at the age of 36  Trained under an industry veteran that had spearheaded a large acquisition of product and territory (doubled our territory, and had two databases of customers we could pull from… for awhile)
  8. 8. I Was Presented with a Formative Situation by the Owner…  “Steve, we’re losing customers, and I’m not sure why”  To which I responded… “What is our customer acquisition strategy?”  The response…”That’s a good question… you’ll have to figure that one out.”
  9. 9. An Early Term AHA! Moment  Early research showed high dependence on two large accounts, both of which we were losing for reasons beyond our control  We had no long term strategy to get new customers and preserve the ones we had.
  10. 10. More Research Revealed…  Other large customer defections to the product supplier we had just changed from due to price  An over dependence on too many other large accounts  No systematic sales and marketing program
  11. 11. So… I dove in and asked more hard questions…  Where does new business come from and why?  What marketing and promotion mediums do we use and why? Do they work?  How do we use our existing database, and how to we augment it?
  12. 12. What is the Salespersons Role?  Hard realization #1: They were tasked with doing battle for us, plan and all.  Hard realization #2: They had no clue about MOST of the opportunity.  Hard realization #3: We didn’t talk about progressive sales and marketing “strategy”
  13. 13. The Big “U OH” Moment…  This was happening on my watch…  We’re losing business…  We need a plan NOW…  What do I do NOW?
  14. 14. The Lockdown Month…  What I hoped to find ASAP was…  Sources of data and how to use it  What expenses to eliminate and where to channel future investment that we could measure  How to keep from throwing bodies at the problem until I understood the problem!
  15. 15. What I hoped to Emerge With…  A business plan that took into consideration current and future trends  A way to gauge Return on Investment  A plan that was predictable and reliable
  16. 16. The Story of My Findings…  A comprehensive “plan” was possible, but would require patience  Other industries have been using some tools and technologies for years that we could benefit from  It would take a full commitment to pull it off
  17. 17. A Ratio No One Wants To Talk About  Our industry has a low “Asset to Aptitude” Ratio  Translation: Huge investments in capital, low application of strategy to create, communicate with and manage customers  Other industries that are more competitive than ours routinely use better strategy… WHY?
  18. 18. Trends That Affected Us Then… And Still Do Now…  Year 2000: Huge shift from “outbound marketing” to “inbound marketing”  Translation: Customers now could find you when and how THEY wanted, and ignored most of the other efforts.
  19. 19. Stats and Trends That WE MUST ACT ON  88% of capital equipment buyers go online first, regardless of the relationship they have with you  4 in 10 sales originate from a web based inquiry  The totals are climbing higher every SINGLE DAY!
  20. 20. What I Identified as Components of a true “System”  Website Design: How to plan for the future and not reinvent your site every two years  SEO: How to make your site found  Lead Generation & Management: What happens when someone contacts us?
  21. 21. The “System” continued…  CRM: We need a foundation from which to manage sales and marketing campaigns  Database Management: We need to stop using bad data, use better data, and routinely make this a part of how we run our businesses. IT IS AN ASSET!
  22. 22. The “System” continued…  Customer Surveys: We need to ask, constantly, “how are we doing” and work the findings into our business”  Sales Force Automation: What are the processes that can be automated without removing the personal “closing” aspect of our business?
  23. 23. The “System” continued…  Graphic Design: We’re still tactile, but we created crappy material and it left a bad impression.  Direct Response Marketing: How do we actually compel someone to act, and not throw our stuff in the garbage
  24. 24. The “System” continued…  Research: How can we do the research, work the findings in to our material, and create good, compelling copy that increases our response rate?  What is the “science and art” of good copy?
  25. 25. We Created the “System”  We surveyed and did the research  We mixed up our efforts and tracked the results  We TESTED everything  We COMMITTED!!!
  26. 26. Here’s An Overview of The Results  Once the “System” was reasonably installed (meaning, you never finish, but it was built)  We clearly established metrics and measurements that mattered the most  This is what we found…
  27. 27. Website Summary- Example #1- Annualized totals  Pageview Totals: 224,796  Contact Form Page Visits: 32,400  New Product Inquiries: 41,220  Used Products Inquiries: 26,978  Rental Inquiries: 8,848  Parts Inquiries: 26,995  Service: 10,135  Employment: 10,711
  28. 28. Lead Summary: Example #2  Year 1, 2002: 432 Leads  Year 5, 2006: 4,836 Leads  An Increase of 1200%... Market trends were not increasing at those levels  Did NOT include internal and a variety of other lead creating programs
  29. 29. Sales Increase: Example #3  Outside Branch Locations  Underperforming Departments  We identified what we perceived to be areas that were “low hanging fruit”, and focused our efforts where our sales to opportunity were the lowest
  30. 30. Sales Increase: Example #3  Total Company: Increase of 54%  Time period: 2002-2006  No acquisitions, no new products  Lost approximately 20% of business from large accounts that we lost for reasons beyond our control
  31. 31. Sales Increase: Example #3  Outside Branch Locations:  El Centro: Took over branch from another dealer, 5 year increase of 516%  San Diego: 3 year increase of 80%  Oxnard: 3 year increase of 98%
  32. 32. Department Sales Increase  Rentals: 4 year increase of 79%  Used: 2 year increase of 226% Other Key Metrics  Credit Applications: Increase of 100%  Awareness: Increase of 78%  Share: Increase of 2 basis points without major accounts
  33. 33. Metrics That Matter  Customer Increase of 27%  2,837 to 3,602 using rolling 2 year AR average  Annual increase of 5%... Unheard of!  Customer Spend increase of 21%  From annual spend of $16,919 per customer to $20,544
  34. 34. More Metrics That Matter  Marketing Expense Decrease of 100%  Ad/Promo Expense still below .03% of total sales  New Sales GP still averaged 9.5%  Highly focused on marketing to the right group of prospects
  35. 35. So… What’d I Learn?  The “old world” vs the “new world”  Relationship selling still matters  How those relationships are being created is changing  How those relationships are managed is changing  There can be a good mix of new and old; and you can do this without adding bodies and expense
  36. 36. Myths & Trends Debunked…  They said we were making a mistake when we got rid of the Yellow Pages  They said our industry was about “relationships”  They said “no one is going to order anything online”
  37. 37. What They Asked… 5 Years Later  How long did it take you to “build this system?”  What steps do you take to get started?  How much does this cost to do right?
  38. 38. Here’s The Solution  Start slowly, assess where you are  Look at internal resources… do you have what it takes to develop and apply the right strategy for the next 5-10 years?  Understand the elements of a plan, talk internally, commit!
  39. 39. Each Step Has a Lesson  It’s OK to make mistakes, just try and limit them  Create forward momentum  Involve others, constantly seek feedback  Set up metrics that matter
  40. 40. Common Mistakes  We don’t have the time…  We don’t have the money…  We don’t have a plan…  We don’t have the people…
  41. 41. Common Mistakes…  Waiting for the “perfect moment”  Not understanding “expense” vs “investment” Remember: Companies that fail to plan, plan to fail!
  42. 42. The First Step to Getting Started  Ask the hard questions, assess your readiness  Take an Online Heath Check  Take some video tours, understand the concept.  Visualize a plan, cost out the key components  Commit!
  43. 43. Any Questions? Steve Smith www.EquipmentFX.com 936-499-4644

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