"Business Goes Where Business Is Invited" – A Case Study
It sounds simple but inviting your customers to do business
with you is an effective strategy for significantly improving
current sales. Take it from Max Grassfield, owner of
Grassfield's an upscale men's clothing store in Denver. Max
founded the store 35 years ago, and is still running the
business.
Max has become so skilled at inviting his customers to do
business that he developed a trademarked system called,
"Invitational MarketingTM." Max issues personal invitations to
his store to a carefully selected group of individuals in the
Denver area. His method works.
Several years ago, Max Grassfield asked himself, "What can
we do to make Grassfield's unique (which is a question all
small business owners need to ask themselves)." The answer,
which he evolved after much study, research, and effort was to
develop methods to know his customers "better than the other
stores know their customer."
For the last ten years, Grassfield's has been collecting a
database of information on its customers, who voluntarily
provide it. Originally, the data included name, address,
telephone numbers, sizes, birthdays, and the wife's name.
(He discovered that wives are often heavily involved in their
husband's clothing purchases.)
He regularly writes customers on a one-to-one basis that use
the customer's first name or nickname (as the customer
prefers), their sizes, wife's name, product preferences, and
references to what they bought in the previous season.
Most communications are programmed to include messages
designed only for the particular customer addressed: "I've
been keeping my eyes on the 44 long suits…" Every letter is
personally signed by the customer's salesman who he met
while visiting the store.
Recently, he sent a wave of three different oversized postcards
in one month intervals, to 4,100 regular customers. Each card
greeted the customer by name, and was signed by his
salesman.
There were 117 respondents (a 2.85% response rate) with an
average sale of $451. It was an outstanding success. The final
cost per piece mailed was just 48 cents including postage. For
a $1,9868 investment, he brought in $52,767 in sales. (Compare
that with the cost of full page ads!)
A couple of months later, Max selected eight suit sizes that
were overstocked. Using the database, he drafted a special
note to each customer whose size fit one of these eight
groups.
The incentive was $100 off any suit in that inventory,
and $200 off the high-end Hickey Freeman suites. He mailed
1,164 invitations at a cost of $558 and sold 56 suits in 39
transactions. The average sale was $1,110 with a total volume
of $43,307!
This case study is a great example of the power of marketing
to your current customer base. Max knows who his good
customers are and he takes advantage of that by personally
inviting them to do business with him, again and again. It also
demonstrates the power and importance of collecting
information about your customer and how it can be used to
make you a lot of money.
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