Author: Chief Heartrepreneur®

What Is Cost Leadership?

I was recently in a conversation with a client and they asked me to define cost leadership.  Because this topic comes up a lot with clients and participants at my seminars I thought I would write this brief article to give clarity about what cost leadership really means.

 

Let’s first look at how people buy. People love lower prices. People buy from the business that provides the same value or same result for the lowest cost. A company can’t just have low prices. They need to provide quality or a result for their buyers in addition to low prices.Lower prices tend to attract customers. But offering lower prices is just one piece of a puzzle on the business end. How can you offer lower prices than your competitors and still stay in business?

Before you can decide to be the lowest price business you have to know your operating costs and understand what your expenses are to deliver your products or services.

Cost leadership is how a company lowers their operating costs and therefore can afford to cut prices and be more competitive in their marketplace knowing that customers want to pay lower prices. Companies get ahead by lowering their operation costs beneath those of others in the same business. This means they try to find ways to reduce costs in their company so that they can offer a product at a lower price than their competitors. Because so many customers want to pay a lower price for goods and services, these companies can gain a wide audience and become the cost leader in the industry.

 

One of the examples I use to demonstrate cost leadership is Walmart. Their advertising is focused on being low priced. Walmart lowered its operating costs by being a very large company that can buy in bulk at reduced prices and then pass those price reductions on to its customers.

Take a look at your business and see where you can cut costs or buy things for less and how you can pass savings on to your customers and become the cost leader in your industry. You will gain a lot of market share as soon as you do this.

Questions?  Comment below.

 

The Shift In Coaching

I’ve been a business and marketing coach for 2 decades and have learned a lot about how to effectively coach people. I’ve coached over 5,000 small business owners. During my first several years in the field, I was coaching one to one. I found that my clients got results slowly.  I also found that when I was charging lower prices during those 2 years a lot of my clients weren’t super committed to the coaching process and didn’t do the work needed to get results.

While I was working with a hospital and coaching their leadership team I began to see the difference in the results I was getting while I was engaged in team coaching.  First of all, the hospital was paying me a large fee to coach the team leaders and second of all the synergy that was happening while coaching the group was having my clients get much faster results than the individual coaching I had been doing.

I began to wonder about the team v group coaching and if I could work with my clients using group coaching tools and my team coaching skills and get great results coaching groups of people instead of individually coaching my clients.  I started my first group and charged high prices, promised an actual result I knew my target audience wanted that I could actually deliver on and put through my first group coaches and trained them to do what I was doing.  My executives were coached by me following a similar method to MAP Coaching which is a model that I was familiar with.  I was also familiar with KW group and how they used group courses and coaching using module-based learning with weekly sessions.

I enrolled 41 people at $1200 each in my first group and most of them achieved the result they paid for, showed up very motivated and got more value from being part of a group than if I had individually coached them.  I also found that these clients were willing to pay me a premium price because I wasn’t just showing up with no agenda.  I had a clear course to teach over a short period of time with objectives and outcomes and delivered on the promise of giving them the result they hired me for. The group members bonded and began to form a community of support which expedited their results, too.

I shifted my entire coaching business after running that first group and seeing their results. I also realized I now had a lot of free time to do other things as I was coaching many people at once instead of the one to one model that is so prevalent in this field.

For the past 18 years or so, I have primarily coached groups helping people get real results in a short period of time.  I believe so strongly in this model I now teach this method to other coaches and consultants and I help them create their high ticket, real results, signature coaching program that they can command premium prices for.

I have a webinar I did on this topic and it’s free. 

 

Everything You Need To Know About Marketing Your Consulting Business

Are you a business coach?  Business consultant?  Business advisor? Are you a provider of internet marketing consulting services?  If you are in a business related to consultancy and marketing services or business services then you will want to read every word of this article numerous times.  I will reveal the real truth and the secrets behind how to market consulting services because almost everything you have been taught about marketing consultant services is wrong.  Everything you’ve ever learned about generating leads and growing your business is wrong. Everything you’ve ever heard, everything you’ve ever tried, and everything you’ve ever done — it’s all wrong.

The Right Way

Consider this your guide to marketing consultancy services.  What I want to do in this article is teach you a system for marketing your business to a point where it becomes instantly obvious to your prospects that they would be an idiot to do business with anyone other than you at anytime, anywhere or at any price.  I don’t care if you consult with online or off- line businesses, this information will help you with your marketing of consultancy services.

Let’s look at how I would marketing my consulting services to a chiropractor as an example.

Let’s say I speak with a chiropractor and who just spent more than $10,000 on radio advertising. The chiropractor spent an entire weekend with an audio crew in her office interviewing her staff, explaining her facility and getting the entire production just right for prime time over the airwaves. And after all that work, effort and expense she ran the ads for several weeks and her your phone only rang 15 times and those ads resulted in producing just one single patient at $1,900.  How do you think she would feel after investing $10,000 and winding up with a net loss of $8,100 she will never get back not to mention all the time, effort and energy she wasted?

Let me ask you this.

What if I showed this client how to take just $1300 of that marketing budget and  just by changing what her radio ad says instead of getting just 15 calls resulting in only one sale she could generate 137 calls and close 37 of those calls into brand new paying patients each worth an average of $2500 and she pocketed a cool $92,500 for her trouble? That’s what’s called getting more results and making more money for the same time, the same money and the same effort spent.

You must show clients your ability to do this systematically for them with your marketing.

I speak to prospects about my marketing consultation services and do nothing but show them how to make these changes to their current marketing and advertising with my online marketing consulting services as well as my off -line help. If you and I are marketing to the same people imagine that you are marketing your consulting services by telling how great you are and what you do for your clients and on the other hand, I am actually showing them the changes I will make to their marketing and advertising just like I did for this chiropractor.  Which marketing consulting services companies would you rather hire?  My small business marketing consulting services and my internet marketing consulting service will be the choice because I show you exactly how I find my fee.

Show Prospects Results

I show you my prospects how to leverage what they’re already doing and how they too can get those exact same results for their business just by changing the way they do all of their marketing and advertising.  And I’m not talking about radical changes. Just simple, common sense changes that enable you to exponentially leverage your marketing’s results. That $10,000 marketing budget the chiropractor was spending remained the same whether they were getting 15 calls or 137 calls. I share EXACTLY how my prospects can accomplish these same results with their marketing and in the process, dominate their entire industry.

This is what I call demonstration marketing.

I don’t tell and try to convince prospects how great I am.

I show them what I will do, how I will do it and then I actually guarantee results.

I Challenge YOU!

I am a marketing strategist and I work with small and medium-sized businesses that have little to no money to spend on marketing.

I show you how to generate all the leads you can possibly handle by evaluating your existing marketing and showing you how to dramatically reduce or eliminate the money you’re currently spending while significantly increasing both your response and conversion rates.

I can typically double or triple your current response rate but a 50 to 100 times increase isn’t out of the question.

And best of all, the strategies I’ll teach you will continue to work for you month after month for as long as you’re in business.

But listen, talk is cheap and I know that you’ve heard these types of claims before, so put me to the test and let me prove that everything I’ve just said is 100% true.

If you will invest just 45 minutes with me, I promise that I will find you at least $10,000 in additional revenue that you can begin to put in your pocket this month and every month forward.

We can do this 45-minute session over the phone as an added convenience to you and I promise during the time we’re together that I won’t try to sell you a thing.

Interested? Complete this form.

Are You An Entrepreneur Or Are You A Small Business Owner?

You might not even know the answer to this question and you might think being an entrepreneur and small business owner are the same thing.  What is your answer?

I often ask this question to my new clients and find many of them say they are entrepreneurs.  I tell them you are an entrepreneur if you have started your business and it is a new idea or product or service and not an existing business.  I also advise them that they want to shift from being an entrepreneur to being a business owner.

Why? Business owners don’t just have the vision, they also know their target market and what their target audiences biggest problems are and they have the results they are seeking built into their products or services.

Many times entrepreneurs have great vision and are poor on execution and strategy. They aren’t able to be in business long term because they don’t focus on actions and are busy creating one venture after the next.  Business owners focus on tasks and goals and objectives and getting things done.  They make certain their employees or contractors are also focused on the goals at hand.

Entrepreneurs are more visionary and think of things in the future and are creating new ideas constantly and running after shiny objects.  They aren’t making day to day decisions and are instead focused on the future.

I’m not putting down being an entrepreneur since I certainly am one… I just know that you must also become a small business owner who is entrepreneurial in order to have long-term success in business.

I am curious how you see yourself right now?

If you were one of my clients I would offer you this advice:

  1. Be a business owner who gets professional help.
  2. Be a business owner who learns the fundamentals required to successfully market your business and attract as many new clients as your business can handle.
  3. Be a business owner who knows how to use your marketing to generate immediate cash flow.
  4. Be an entrepreneur with your ideas and vision.
  5. Be an entrepreneur with your calculated risk taking.
  6. Be an entrepreneur with your sense of fun and joy in building your business.

I believe when you blend these combinations you will be one of the most successful business owners who still has a great entrepreneurial spirit that is fed through your small business.

What are your thoughts in response to this? Comment and let me know.

 

Have You Wondered And Been Afraid To Ask …

There are so many business terms floating around that unless you have an MBA you might be very confused by business jargon. One term that I am asked about a lot is cost leadership.  Have you ever wondered what is cost leadership? This article will simplify cost leadership.MBA

Cost Leadership Defined

Cost leadership is a strategy used by companies to achieve competitive advantages by creating a low-cost position among their competitors. Think of it this way… cost leadership is a business strategy a company uses to maintain prices that are lower than its competitors. To do this the company will increase productivity and efficiency, and/or eliminate waste and/or, control their costs.

Clearly, none of these things are simple for a company to do yet this is how a company becomes the cost leader in its industry. As the company manages its value chain and lowers its costs through its entire supply chain the company can compete by being the lowest priced in the marketplace it serves. Cost leaders don’t just make a less expensive and poorly produced product. They must make a competitive product that can actually compete with others being sold.  If the product isn’t able to compete then consumers will look elsewhere and stop buying from the company that is inferior even if it’s products are less expensive. Can you see how difficult this is?  Maintaining the same quality product while lowering the costs of production is no small task. Companies can manage their costs many ways including by size, efficiency, scope and scaling.

Scaling is a way many companies become cost leaders. Think of companies who ship a lot of volume like Costco who are able to keep their production costs lower with their huge volume and provide products to consumers at a lower price point than their competition. This is exactly how these types of companies are increasing in sales and taking a large share of the market.  Another example is McDonald’s who keeps their costs down by using staff who are not cooks and training them to cook in accordance with McDonald’s guidelines instead of having to hire cooks who would be paid more than these non-cooks.

 

 

 

 

What are ways your business can cut production costs or decrease operations and still provide a high-quality product that can compete with your market but for a much lower fee?

Post some ideas here.