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Episode 68 – Re-Upselling | Making the Most of Current Customers

Mar 7, 2018

This Episode

Mark Stephenson & Marc Vila

You Will Learn

  • How giving away product can make you more money, not less
  • How ColDesi’s “Bundling” strategy came about and how you can apply that to your business
  • What questions you can ask you customer that no one else ever does, than can double your business from an existing account
  • What it’s like to hear Mark and Marc talk in an echo chamber

Resources & Links

Episode 68 – Re-Upselling | Making the Most of Current Customers

The WORST statistic we could find, and there are a lot of them available, says that selling to an existing customer is 68% less expensive to selling to a new one.
 
New customers don’t know what you do, what is available, what they want, how to talk about what they want AND what they can expect to pay. Current customers will buy more and pay more. You have a trusted relationship. If you advise them to buy a better garment; they are more likely to do it. Compared to new customer more likely to haggle or expect a lower price. They cost less to service and less time to complete orders – you know their wants, needs, pet peeves, sizing preferences.
 
You already know what they are worth – you know big their orders are, what shirts they buy, their budget, how much time they are worth, etc
During this podcast we’ll discuss the following 5 Strategies to Up-Sell and make more from your existing customers:
 
1. The Freebie – Sample on Delivery and Marc Vila’s Theory of Reciprocity (ok, not really HIS theory, but he’s going to talk about it.. so props). Why do they give away samples at the food court?
 
2. Anticipating Business Because you KNOW Their Business – When you are IN your customers business, when you know what they have going on, coming up and you know what matters to them you will be able to upsell.
 
3. Horizontal Marketing – How you can make more in more ways than you ever thought possible, all starting your current customers.
 
4. What Else they Buy – one of our favorite ways to plan expansion and add a few extra dollars to the bottom line while you do it. It’s a good one!
 
5. Next Order Couponing – when and how to use discounting to up sell and add to your business. Follow what the ecommerce guy says on this one – notes are encouraged.

Watch Us Recorded Live on YouTube

Transcript

Mark S: Hey, everyone, and welcome to episode 68 of the Custom Apparel Startups podcast. My name is Mark Stephenson, from ColDesi.

Marc V: And this is Marc Vila, from Colman and Company. Today we have a great episode! It’s part of our trilogy, another trilogy. We’re talking about re-upselling, and that is making the most of your current customers. So, how to take your current customers that have already done business with you, and sell to them again.

But not always just the same thing, but sometimes, something different.

Mark S: Yeah. Make more money with every sale. That’s kind of the goal. But first of all, I have to tell you we’re in a new place. Part of our experiment, not only with video, but with trying different locations to see what works best and works great, we are at our ColDesi Dale Mabry campus showroom, where we house Digital HeatFX and the Brush N’Bake, the Cut n Press vinyl systems, and the SpanglElite, from the Colman and Company side of the business.

So, please be inspired by everything that you see behind us, as we go through the topics of the podcast. As a matter of fact, on Facebook, let us know if you’re interested in any of these shirts, or the technology behind it.

Marc V: Yeah. We’re happy to talk about them. Then maybe even when the podcast is done, if we still have some Q&A going on, we can chat about some of that stuff, too.

Mark S: Sounds good.

Marc V: Okay, great! I guess I’ll start us off a little bit, on what we’re talking about here. We mentioned that we’re re-upselling, so what’s the story here? The story is that you’ve got a current customer who has done business with you before, or they’ve just finished a job. The first time you’ve worked with them.

And in the beginning, if you listened to our last podcast, you might have upsold them something. You might have upsold them from the generic kind of branded shirt, into maybe like a Nike brand, or something like that.

Mark S: You did upsell them, because you did listen to the last podcast. It’s been two or three weeks, so definitely you should have listened to that, because what we’re trying to do with both of these is to help you take that person that’s in front of you, and make a few extra dollars every time it happens, so you’ll be more profitable.

Marc V: Yes, exactly. Now you’ve sold them an initial job, and you upsold them. So, you sold them a better shirt or an extra decorated spot, or whatever it is. Now you’re to the point where we want to upsell that customer again. We want to be able to provide them with an additional service that they may not have directly come to you for.

That business is easy. It’s easy to pick up the phone and take an order. It’s a challenge to inspire your customer to do something new with you.

Mark S: I think that’s a great thing to say out loud, too, is you are inspiring your customer to take an additional action, to make an additional purchase. There’s really no selling. We used to avoid, and we said this in the last podcast, we used to avoid the S-word, because people don’t think of themselves as salespeople.

They don’t like the word “sell,” or the idea that they’re going to put one over on somebody, and try to sell them something they don’t need. In the last podcast, we talked at length about the idea of becoming the expert, of offering something that your customer may not have thought of, and just making sure that they know everything that you do, so they can purchase more from you, and you can make more money.

During this one, we’re talking about how easy it should be to take that customer that already trusts you, that you’ve already done business with, and add even more to the next sale.

Marc V: There are two things that people always like to get. Right? A meal and some clothes. If you give somebody a free hat, or you give somebody a free sandwich, they’re incredibly happy.

Mark S: That was very specific – a free sandwich.

Marc V: Yeah, a free sandwich or a free slice of pizza, or a free hat. People love that stuff! It’s proven time and time again that, what do companies often do, if you do a lot of business with them? They buy you lunch. It’s not worth a lot. It’s a few dollars a person.

Mark S: But it’s nice.

Marc V: It’s really nice, and it feels good. The same thing when you go to a game or a concert, they throw out the free t-shirt or a free hat. People love it. We’re in an industry that people naturally love to receive these things, so when you re-upsell to them, and they get new apparel, they’re going to be happy.

Whether they paid for it or got it for free, people love new clothes and they love food.

Mark S: That brings us to kind of upselling strategies. By the way, we’re going to go through five strategies to help you understand the best ways that you might be able to upsell your customers, so you can make more, the next time they buy from you.

And that first one that Marc just started to describe is what we call the freebie. And there are a couple of different kinds of freebies that we’re going to go through. So, this is one where you might want to make a few notes, because I think it’s one of the most effective strategies. We’re putting it right up at the top.

Marc V: By the way, I’m here with my mobile devices and laptop, because I’m monitoring. Maybe one day, we’ll have an Engineer.

Mark S: An Engineer.

Marc V: Yeah, that sits back there. But for now, I’m kind of a host/Engineer.

Mark S: Like with the cap and the [inaudible 05:27]?

Marc V: Yeah, with the cap and the stripes.

Mark S: Okay. That would be fun!

Marc V: We’ll just have to train them how to do this.

Mark S: So, you’re texting and you’re interacting?

Marc V: I’m texting and I’m interacting and I’m monitoring, so I’m going to use the mobile device in here. Every once in a while, when you chat, I’m going to pick up and I’m going to monitor some things.

Mark S: He ignores me.

Marc V: No, I’ve heard everything!

Mark S: That’s okay. The first kind of freebie that we’re going to talk about is literally the freebie. We’ve talked about this as a great strategy in other podcasts. When you have a customer place an order with you, if it’s for printed t-shirts, and you sell embroidery, then you put an embroidered cap in there.

If it’s for an embroidered polo and you only do embroidery, maybe you add one polo, with another position, on the sleeve.

The idea of this freebie is to present the customer with something extra, when they get the order. That way, it will inspire them to order next time. You’re using the freebie so they’ll know other things that you do. They’ll feel like they’re being more appreciated, when you do that.

Especially if you’ve got a coach that you’re doing a big order for, maybe the coach gets a free hat, along with all of the shirts or the jackets that they ordered. Everybody else is going to see that. They’re all going to want the hat. And the next time that the customer places the order, you may pick up that extra business.

Marc V: Or they may just call in to say “Hey, I got the free cap. Thank you! The assistant coaches saw it. They love them. They were mad at me, that why didn’t I get them one! So, how can I get some more of these hats?” “Oh, great! Actually, I can make you some of those. They cost X amount of dollars apiece.”

Mark S: We actually had a couple of customers chime in, when we were setting this podcast up. We asked a few people on the CAS group what they would do to upsell. One of them added $750 in caps, to a t-shirt order. So, somebody came in for t-shirts. They offered them the caps. $750 later -.

That will work just as well if you forgot to talk to them about caps, but you include it in the box. You’ve got a win, there.

Marc V: In the last episode, we talked about upselling to the customer. What you did was you offered them the cap. They respectfully declined. “No, it’s not in the budget,” or whatever it might be. But you still provide the freebie, because you know that in providing that free sample right there, and the offer to buy it later, that they’re probably going to really like it.

And even though they didn’t have the budget now, this payday, to do that, when they’re wearing that cap and other parents or assistant coaches or whatever might see that, they’re going to want them, as well. So, even though they said no now, that doesn’t mean that the freebie is not going to make another sale tomorrow, or in the next week.

Mark S: Right.

Marc V: Especially as money flows through, and time flows.

Mark S: That’s a great time where you can take the opportunity that you would normally not think of maybe as marketing, but it adds, if you go back and listen to our podcast on customer experience, it adds a lot of extra to that relationship that you’ve got.

The freebie, the pure freebie, is just somebody places an order with you, and you put a gift that makes sense for your business, relates to your business, and that a customer can purchase later on, if they’re interested, when you send out or when you deliver the package.

The second freebie is kind of doing that when they don’t place an order. Marc?

Marc V: I’m engineering!

Mark S: I know, I know!

Marc V: But anyway, yes. When we’re talking about the other one, they didn’t place an order. You want to give them a freebie. The second type of freebie is when you’re actually just sending them something in between orders, not related to the current order.

This could be if you just started doing embroidery. You just started to offer glitter vinyl. Maybe you hadn’t done it before.

Mark S: You’ve got some kind of new technology.

Marc V: You’ve got a new technology, or a new idea.

Mark S: A new shirt type.

Marc V: A new shirt type, a new cap. You received SanMar’s little catalog, and it said “Our 2018 Spring Items,” etc. With that, you said “You know what? I would like to check this cap out. I’d like to try to offer it. I think it looks really cool. It looks comfortable.”

You order one, you do like it. You sew it out, it sews out beautifully. You say “I think my customers should get this. I think they should buy it.” So, what do you do? You maybe pick a few customers, and I’ll give you a tip. The ones that have money, the ones that place orders, the ones who are nice, who like you, the ones who aren’t cheapskates.

Pick the good customers, the ones who want their business to look good, who want their team to look the best, who have really passionate fans. A school who has an open budget for apparel, whatever it is. You find the good customers, and you say “I’m going to take their logo and I’m going to sew it out, and I’m going to send them a cap.”

Then, that’s another freebie. With that cap, just another little idea you can do with it. Of course, you could say “If you want to buy these, call me.” But you also could just ask for feedback.

Mark S: The evaluation thing is a very good idea.

Marc V: Yeah, the evaluation. With the evaluation, you are actually going to your customer, and you’re saying “Hey, take a look at this cap. It’s a brand new one, I’m thinking about offering in my line. I’m going to add it to the items that I sell. What do you think about it? When you receive this, if you wouldn’t mind putting it on and wearing it for a bit, then shoot me an email or give me a call, and give me a review on the cap.”

For one, they’re going to love that it was free. They’re going to love that you asked them for their opinion.

Mark S: They feel important.

Marc V: They feel important, and they are important, because the answer is important. Right? So, not only do you like it, but you’ve proven some of your good customers like it. Then, when they call up, and depending the type of salesperson you are – if you’re very direct, “How many would you like to order?”

If that’s not your style, you could say “Well, I thought you would like it. That’s why I sent it to you. I’m glad that you did. By the way, they’re $17 apiece, with your logo, minimum order of five.” Whatever is your business. “And I’d love for you to order some whenever you’re ready, so keep it in mind.”

Mark S: Or you could just play it very casual, like “Thank you very much. I really just wanted your opinion. I won’t even take your order yet. Let me wait until I have some in stock.” This is great on a couple of different levels.

You can do this, by the way, by mail, or in person is even better, to go by and drop something off. If you’ve got a bigger customer that only orders a few times a year, it’s also a great way to keep in touch with them in between. You’re bringing up your value, as somebody that – you’re checking with them, to see the quality of the product, and if they would be interested in ordering next time. That makes you look better.

One question that just popped into my head, that I know that a lot of you are probably thinking, is that that sounds expensive, and it’s going to take time.

Marc V: Okay, talk about that, and then we’re going to move on.

Mark S: Yeah. Like a higher end t-shirt is going to cost me money. A cap is going to cost me money. Well, the reason that we’re talking about this strategy in the upselling and re-upselling, making the most of current customers, is because that customer is cheaper for you to deal with. You didn’t have to advertise, to get that customer a second time.

You didn’t have to teach them the ordering process. You didn’t have to tell them how to set up their graphics. So, it’s actually a less expensive transaction, to inspire them to order again.

Marc V: Absolutely. The bottom line, as we mentioned in the beginning here, is they’re going to love it. They’re going to love the freebie. They’re going to want to order the freebie. They’re going to love the apparel you put in there.

Part of the reason they’re going to love it is because you’re going to pick a good one. Don’t say “I’m going to give them a free cap. Here’s the cheapest cap I can give them.”

Mark S: “I got this 90-cent t-shirt from [inaudible 13:34]. I’m going to send them that.”

Marc V: No. “I’m going to put one that I’m going to want them to buy.” So, let’s move on. The next one we want to talk about is anticipating business.

Mark S: I really like this one.

Marc V: That’s why I want you to go with this one. You like this one.

Mark S: Yeah. I really like this idea, because a lot of you out there, we’re talking about current customers, and I know that we have relationships with our current customers. Probably a lot of you that are listening to the podcast have been listening for a long time, and you talk to us on Facebook.

We think about you guys, when we’re doing new podcasts. So, that customer experience is really important. People follow us on Facebook. The idea behind anticipating business is for you to get into your customer’s business in the same way that you might get into ours.

For example, if you’re dealing with a big electrical contractor, let’s say, and you do all of their uniforms, follow that customer on Facebook. Follow that business on Twitter, on Instagram, on wherever you are socially. The idea is that you’ll know what’s happening inside that business.

They may have ordered 50 uniforms from you, but you may see on their Facebook page that they’ve got an announcement where they hired ten new people, because they’re expanding. That’s an opportunity for you to reach out to them about ten new uniforms.

You may also see, like “Oh, my God! I didn’t realize that they do these team-building exercises twice a year.” They all get the same shirts, they get hats and they get bags, things like that. You can learn about all of that from their social, because you follow them. Then, you can approach your contact and say “Hey, I was just on your Facebook page. I think that team-building exercise is an amazing idea! Can I do some shirts for you?”

Marc V: Yes. And what else you do with that is you notice – it’s everything that comes along with anticipating what could happen. It’s not always just the direct, like they’re doing it, event. But they are participating in a 5K for a charity.

Mark S: Oh, good one.

Marc V: You might not be able to necessarily get the business for that event, since it’s booked. You know, if might already be done. But what you can do is, now you say “Hey, you know what I would like to do, to help for this? I’d like to provide some free caps for your team. Or how about if you buy these caps for this event, I will donate a certain percentage of the profits to your cause.”

“By the way, since you’re participating in this, do you know who’s in charge? Because what I would like to do is see if I can help them participate in other events, by providing t-shirts or caps, or other apparel they might want.” So, it’s also about making connections.

Mark S: Yeah. It may be that that 5K event is for a cause that you’re passionate about, too. You didn’t realize that your customers were running. So, you get to stand behind that. Say “Hey, I’ve never met most of your guys in person. I’d love to come out and say hi during that.”

That’s anticipating business, by being in your customer’s business. Don’t just take the order. Participate in their business, so you will recognize future opportunities.

Marc V: Yes. It will be events that they’re doing, and certain things like that, but it’s also going to be participating, and just guessing what other things might be happening. For example, spring is coming. The sun is going to be out more.

Mark S: Right.

Marc V: Do their workers work outside? Are they allowed to wear caps? If they are, this is a great time to anticipate that their workers might want caps. If it’s a lawn service company, their business is about to pick up, because the grass is going to start growing again. They’re going to need to trim bushes and all that stuff.

You call them up. “Hey, by the way. The season is coming up again. I know you’re going to be doing some business. Do you need any new shirts? Do you need any new caps?” Things like that.

Mark S: It’s the rainy season August and September, here in Florida. It rains every day, at the same time. If anybody is outside and working, they need a hat. They need a rain poncho. They might need boots. There are a variety of things that go on to that, and you’re right. You’re paying attention to what’s going on seasonally, and in their business, so you can get into it, and sell them more stuff.

Marc V: Here’s another little trick. You don’t always even have to decorate the apparel.

Mark S: Yeah. That’s a really good point.

Marc V: Some of the things are just an item that might not be decorated. But since you’re in business, and you’re in the business of buying things wholesale, learning how to do all of that, maybe you’re just anticipating that they might need umbrellas.

Maybe you’re not going to decorate them. But what you do is, since you kind of know how to source things already, you find a place online where you can buy some umbrellas in bulk. You’re buying 100 umbrellas. You get them at a really good deal.

You say “Hey, by the way, if your team needs umbrellas, because they’re salespeople and they’re dressed very nice, I can go ahead and give you customized ones for this price. Or I can just get you a good deal on umbrellas. $9 apiece, and they’ll all match.

Mark S: I love that idea.

Marc V: There’s a bunch of little things you can do. The next thing that we’ll talk about is horizontal marketing. I know this is another one that you like.

Mark S: Yeah. Horizontal marketing is really – we’ve talked about going in to a customer’s business, and looking at everything that’s happening, and using that to help upsell into that account. Horizontal marketing is going to the person that you deal with in the business, and going sideways inside it, to look for opportunities.

For example, let’s say you’re doing shirts for that electrical contractor. You do all of their embroidered polos. You do all of the uniforms, but they’re a pretty big company. Do you do all of their marketing materials, too?

I’m talking to the purchasing agent that buys uniforms, but I’ve never talked to anybody in marketing. What you can do is you can go and talk to that marketing person and say “Look. I do all of this for your company already. I’d love to have the opportunity to do more. Can you tell me what kind of apparel you guys buy? Do you give things away? Do your marketing employees wear something different?”, like they do here at the ColDesi properties?

What other departments can you do business with? It’s kind of the same thing like if you were dealing with a coach.

Marc V: Yes. When you’re talking about the horizontal marketing, I love that, because what you need to do is you have to think about all of your customers as not just being – like working for that little part of it. Your customers are always more complex than you think, even if they’re just a landscaping company.

They’re just a landscaping company, and they’re a small business. There’s the owner, he’s got three employees; it’s him, his wife, and three employees. That’s it. You consider “I can’t go any more horizontal in this business.”

But does your landscaping company – what happens when he has to buy shrubs, to put into a house? Does he work in conjunction with a nursery? So, there’s also horizontal going in this business, because even though he’s not big enough to own a nursery and the landscaping company and everything, it’s still a very vital part of his business.

He goes to that nursery every day. His wife talks to the owner of the nursery every day.

Mark S: Right. So, you are upselling your customer, by helping them get you sales. It’s the same thing – I love that idea. I love the idea of you do all of the sports uniforms at a high school, for a coach. But you’ve never met the Principal. You’ve never done clothing for the teachers. You don’t know anybody at the PTA.

Just like that landscaping guy, and just like the coach, you can go in and say “Who else in your business, or who else do you know, who might be interested?”

Marc V: Yeah, so think about it even for really small businesses. Because really small businesses, they have connections to other businesses that are almost a part of their business. If that nursery went out of business, it would severely affect them, so they’re deeply connected.

Small businesses can be much more deeply connected with outside companies. So, think about that. Then, think about within these organizations, if you’re doing just apparel for parents, for just one team in, say like a Little League. You have to consider, “Who is in charge of this? Who can I talk to, to try to get the whole league?”

Maybe there is no central leadership in apparel, and all of the kind of fan shirts are a little bit separate. Maybe there is one. But if you have the opportunity, always go sideways. If you just do the soccer, and you know there’s tons of other sports, you’ve got to show up to an event on Saturdays and Sundays, and you’ve got to walk around and meet other coaches.

Mark S: Here’s a good way to think about this, and the last thing I’ll say, before we move on from this, is that vertical marketing is finding your niche, and going after that niche. If your niche is hairdressers, it’s going from one hairdresser’s office to the next, one haircutting place to the next, and talking to those people, becoming an expert, offering what you do, to them.

Horizontal marketing is, once you’re inside that business, going after every possible connection of business that there might be inside it. It’s going to each one of those hairdressers and saying “Are you part of any church organizations that need t-shirts? Are there any other related businesses here? Do you know the guy who sells you your shampoo? Can I talk to them about shirts?”

It’s a great way to use your customers, to help you make more money. And if you’re doing the freebie, and if you’re inside their business, they will be excited to help you with that.

Marc V: Yes, absolutely.

Mark S: So, I would definitely do all of that.

Marc V: Especially if you have a good rapport with them, if you’re friends with them, if they like doing business with you.

I’m going to pause here for a moment, and just say that I see that a lot of folks have just come in to watch.

Mark S: They’re wondering what the heck is going on.

Marc V: They’re wondering what’s going on. So, if you’re listening to the podcast on iTunes or something like that, and you’re listening to the pre-recorded version, I want you to know that we’re going to be doing this live. So, soon we’ll kind of have an announcement and a schedule. We’ll nail down some official times.

But you’re listening to a live recording right now. You’ll be able to participate on Facebook and on YouTube, soon. Second, the folks who are watching live right now, we’re actually talking about episode 68. This is the Custom Apparel Startups podcast, and we’re talking about re-upselling to current customers.

We’ve talked about giving some free samples. We’ve talked about anticipating some business. We’ve talked about getting more out of the current business you have.

Then, we’re going to move on to the next topic. So, listen online, to get a recap of that, or watch this video from the beginning, when it’s done.

But next, we’ll talk about what else they buy.

Mark S: Yeah. Why don’t you take the lead on this one? Because I think you’re good at this.

Marc V: Alright, awesome! So, what else do they buy? Your customers that, if they own a small business or they’re a team that’s a sports team, whatever it is – they do something, and they’re buying custom apparel.

So, when we’re talking about that, what else are your customers buying that’s custom, that you don’t offer? You’ve got like a Digital HeatFX system, and you print. You do everything printed. But do they buy embroidery? Is that important to them?

You do embroidery, but do they buy t-shirts? You do t-shirts and embroidery, but do they buy promotional items, like bags or pens or keychains or mugs? With that, really consider two things, I think.

One is the technology that you have, in equipment. Can it do other things that you haven’t learned how to do?

Mark S: That’s good.

Marc V: If it can, reach out to your customers. “Hey, by the way, what other promotional items might you buy, or are considering buying?” Just be honest. “I’m thinking about ways I can expand my business. You’re a business owner, too. I know you do the same thing all of the time. I’m considering, what else can I do?”

“I know that with the technology that I have, I can do mugs or I can do keychains.” You name things. “I can do tote bags. Do you buy any of those things, ever? Or what else do you buy, that maybe I can consider offering in the future?”

Mark S: I like this for a couple of reasons. Not just because it gives you the opportunity to upsell now, that we’ll talk about. But also because you’re back to that not only being in that customer’s business further, but you’re also making them feel good, because you’re asking them for their input. You’re getting their expertise. You want their feedback.

So, I like that. You’re going to go in, and you’re going to look at your existing equipment. Figure out what you can do, that you’re not already doing for them. And you’re going to see if they have a need.

Marc V: Yes.

Mark S: The other thing is, is just to make that list. Let’s use that electrical contractor as an example. You’re doing uniforms for a company. You’ve already gone to the marketing people, and you realize that they’re also ordering apparel.

The guy that you normally deal with is also part of a club that buys custom hats, that you’re now doing, because you went horizontal with the marketing. Now you find out that they also regularly need signage, and they also buy keychains. The marketing department gives away pens and keychains with every brochure that they send out.

You don’t do any of that, but there’s still a way, and a great reason for you to make that connection.

Marc V: Yes. What’s really interesting about it is when you have this conversation, you just do some marketing research, to start. All you’re doing is you talk to your customers, and you’re just asking them what else do they buy?

Or if you visit their office, have open eyes. You have to consider yourself that you’re a hunter-gatherer, and you’re looking around. You’re saying “Where is there opportunity for me in my business? Where is there opportunity?”

And if you really want to be altruistic about it, too, “Where is the opportunity for me to help make my customer a better business?” You walk into an IT company that you do some apparel for. You do shirts like this, because they go out to offices, and they want to look nice.

You look around, and you see a few guys prepping up for the day, as you’re making a delivery of shirts. What do they have? They’ve got tablets and they’ve got laptops, that they bring with them. This guy has got them in a brown backpack. That one’s got a bunch of sewn-on patches on his ugly backpack.

That guy’s backpack has got a hole in it. That guy has got a tablet that’s all busted up.

Marc V: That’s good, because that is part of their uniform. They just don’t wear it. So, that’s good.

Mark S: They don’t think about that. So, you look at that. This is a little bit of what else they buy. Their employees buy those bags. They might not provide them. So one, you could offer to the business “Hey, if you want to supply your team with matching bags, I could do that. I also see that they have tablets. We could do tablet cases, as well. I think that’s a great idea. It will help them look more professional. Your shirts are so nice, everything else should be.”

They also might say “I don’t know if that’s in the budget.” “I’m going to give you option two. If it’s not within your budget to supply them, if you want, I can come up with some pricing, and what I’ll try to do is I’ll try to make the deal just as good of a deal as if they were to go to a sporting goods store, and buy a new backpack. Except it could have the company logo on it.”

Then, you could offer for them to buy it on their own. They could outfit themselves, a little bit. Especially if it’s a good deal and it’s a good product, they’re going to like that.

So, go in and look for opportunity within, of what they have. If you notice that they have pens, even if they don’t outright say it, if you notice they have pens, if you don’t do this, outsource it.

Mark S: Yeah, yeah. This is good.

Marc V: Find a place that sells custom pens. There’s a ton of places online. Find a place that has a good deal. You buy them from them, and you mark them up a little bit, and you re-sell them.

Mark S: The strategy here is not for you – I mean, you might, but it’s not for you to get rich on those outsourced items. Right? I mean, you’re going to make a couple of points. You definitely should, or you shouldn’t do it.

But now, you’re getting further into their business. You’re getting more of their business. So now, they’re thinking about you for shirts. You gave them that free hat last year, so now they’re ordering caps. They think about you for that.

And now you’ve printed t-shirts for the charity run that you ran with them, so now they think about you for shirts, uniforms and hats. You’ve talked to them about the bags. Now, you’re talking to them about promotional products or signage, or whatever other products that are even vaguely related to what you do, and you’re adding a couple of points on it, but you’re further into their business.

They get the luxury of having one person to call and talk to, and that’s valuable. So, now they’re talking to you about ordering all of this stuff. It just gives you more opportunities inside the business.

Marc V: And you’re the expert, which is great. You’re the expert on everything that’s custom. I know that you just have an embroidery machine, and that’s what you do mostly, inhouse. But since you’re the expert, when they order screen printed t-shirts, you’re wholesaling that for them. When they order pens, you’re wholesaling that for them.

You can get an insight to your customers on what they order a lot of. It can help you to pick the next technology you invest in. If you’re finding that you’re getting a decent amount of medium-run size t-shirt orders, or you’re just seeing that that’s happening, even if you haven’t started wholesaling.

You see the opportunity right away. It’s clear. Then, you say “I should probably get a digital printer and start printing some t-shirts, because I’m noticing that.

Mark S: At this time, you could actually just do the math. This is what gets me excited about this idea of learning about what else you customer orders. Let’s say you’re just doing embroidery, but you realize that they do four charity runs a year, and they themselves buy 100 shirts every time.

So, that’s 400 shirts. You find out what they pay for it. You can make maybe $10 a shirt. So, you know you have that $4,000 almost in the bag, ready to invest. If you know that they buy something that will make you $300 a month in profit, that’s a lease payment on an embroidery machine or a Digital HeatFX system, or four cutters.

It really is. It’s a great way to prepay for your equipment, almost.

Marc V: It’s really awesome when you have that opportunity. I love that, where you have a customer that you know orders some t-shirts. You talk to them about that, and they say “You know, I would order them from you, if you did it.” “What do you pay now? I can match that price, no problem, whatever it is.”

Then you say “Okay, when is the next time you’re going to do that?” “Well, I do that every June. I do it in June and in December. Every six months, I do it.” So, you say “Okay. It’s March. I’m going to go ahead and pull the trigger. I’m going to make an investment. I’m going to perfect some of this. I’m going to start pre-selling to some other people.”

“I’m going to be ready to go. They’ve already kind of given me a verbal commitment. I trust this customer. I suspect it’s going to happen.” But if not, it’s not just this customer that’s going to order it, but you have lots of other people. It’s a great way to expand your business, get more money for your business, make more money, increase your profits.

But also, just learn to be a better businessperson, by seizing opportunities.

Mark S: I like that.

Marc V: The next one we have is next order couponing. It’s kind of what we wrote. Couponing promotion, deals, etc.

Mark S: There’s a couple of times to do this. Marc Vila is the ecommerce king, so if you ever have ecommerce questions, he’s the guy.

Marc V: Just a side note on that. If you want to email me.

Mark S: Or me, really. You can talk to us both.

Marc V: Yeah, or Mark. MVila@ColDesi.com.

Mark S: Terry Smalley knows. She’s on there right now.

Marc V: If you want to email. I’ve had a couple of people just call. That’s actually fine. If I’m really busy, I won’t respond right away, and I’ll respond later. If I’m doing a podcast, I won’t get it. But I will respond to you, and we’re going to help you with this stuff.

Mark S: Email me, because I actually don’t listen to my messages, so I don’t want to be rude.

Marc V: I don’t think I actually listen to messages, but somebody will tell me you called, if you call reception.

Mark S: So couponing. We’re talking about a couple of different things. First of all, upselling current customers with couponing. The first things somebody might say is “Well, why should I send somebody a coupon, that’s already buying stuff from me?” Right?

The first answer is you would rarely send them a coupon on something that they’re already buying, except as a reward, as a surprise. Somebody reaches their 10,000th custom cap that they’ve ordered from you this year. Man, send them a coupon! Give them some kind of a gift or something like that, in order to express your gratitude for their participation in your business.

Marc V: Yes. That’s just a wonderful gesture, sending out a deal. Like we just ran a recent special on our Triton vinyl. We launched the vinyl last year. We’ve had a ton of people buy it.

Mark S: Yeah, it’s great.

Marc V: We already offered it at a very competitive price. So, it’s already a better price to them, than much of our competition, for a product that’s equivalent, or actually, the Triton is even nicer. But we don’t have to get into that.

But we still put it on sale. Why do we put it on sale? For one, new customers. But this isn’t about new customers. It’s also about saying – we reach out to our current customers and say “Hey, it’s on sale. Do you need to bulk up?” This is a way for us to say “We just bought a bunch of this vinyl. We got a good deal on it. We have two weeks that we can run a sale, to help pass that on.”

People love that. People love saving some money. They love seeing the opportunity to seize an opportunity, and save some money.

So, you could do the same thing with your business. Like you mentioned, you could just reward a customer, just by saying “Hey, you’ve spent a lot with us.” We’ve done that with like reward points.

Mark S: Right. I also like to coupon when you add new products. For example, we talked about the freebie, and including a cap or something like that. Well, when you add a new technology, a new product to your lineup, when you pick a new shirt for your limited selection, or a new jacket, then maybe to introduce that product or to get people to buy in something they haven’t before, with that free cap that you put in there, you might put a 10% off coupon for your first order.

To take the sting of that first commitment out, while somebody tries out a larger order. That’s a great reason.

Marc V: Absolutely. You’ve got the freebie, plus a coupon, which is great. This could be ecommerce, if you have the ability to do that. Or it can just be an actual coupon that they would physically hand to you. Or it could just be a verbal coupon. So, “Mention free hat promo, and that will remind me that you received this, and that you’re going to get 10% off of your cap order.”

Mark S: Yeah. Just make sure that there’s a reason for it. There’s got to be some kind of a reason for you to do the promotion. You don’t want to have somebody buy a shirt, and then give them a coupon for another shirt of the same kind. That’ not a great strategy for upselling.

The great strategy for upselling would be “Here’s your shirt. Isn’t this cap beautiful? Here’s 10% off, if you wanted to order a cap next time.” So, that’s adding a product.

Marc V: Also, sometimes it’s offering a deal because it’s the new product.

Mark S: Yes. I like that.

Marc V: “Brand new apparel styles available now at your t-shirt shop. Here are the various ones. Order before winter is over. Receive a 10% discount.” With that, we can talk about a little bit of that time in inventory, which is another good reason to [inaudible 38:33].

Mark S: Yeah. These are two things that most people don’t think about, when they think about couponing.

The first one is kind of inventory management. If you look in your warehouse, or if you look in your dining room, where you keep your stacks of blanks, and you’ve got a lot of inventory on a product, it’s a great way to turn that into cash.

One thing I’ll say is that your inventory, your stockpiles, anything you have left over, it’s not like stuff that you own personally, that you can just put in a closet, and then come back in ten years, and it will still have the same value to you.

There’s an expiration date on everything; on the style of a t-shirt. Different technologies come out. Maybe you’ve gotten a bunch of bags in that are currently kind of in favor, but you haven’t been able to sell a lot. In five years, in ten years, when you go back and open up that box and see what it is, it’s not going to be worth anything.

It’s important to keep your inventory turning. So, if you’ve got inventory in a product that you’re phasing out, or you’ve just got too much right now, – it’s been 90 days – then turn that into cash, by offering people a discount, through a coupon.

Mark S: Something you can do that’s interesting, with that inventory, is for one, – the unfortunate one would be you ordered 40 caps, and then something drastic happened to the customer. But they left a deposit, so you kind of own the caps now.

You could try to return the caps to the supplier. That may or may not work out. If it does work out, great.

But you could also say “Now I’ve got 40 caps. The customer made a deposit, but they bailed. I told them they had to pay for the caps, etc.” But now you’ve got these caps that you can afford to heavily discount. So, what you do is you send out a notification via email, or you call up some of your best customers.

Say “Hey, somebody else’s loss actually can be your win. I’ve got an opportunity to do caps at 20% off. This is the style I have available.” So, there’s those large things. Those things happen within our industry. They happen everywhere.

The other thing is, if you’re ordering some caps. I’ll tell you a thing that a brick paver company does, which I think is pretty interesting. They’re always moving different types of pavers, bricks. There are tons, thousands of colors, styles, shapes. It’s not quite as bad as apparel, but there’s tons.

What they do is when they order for somebody, they always order some extra, for some small jobs. Because the small job is a challenge. The same thing with apparel. If you have somebody who wants to do three caps, “Alright. I’ve got to order three caps from the supplier. It’s going to cost me $13 just to ship it.”

Mark S: Or that big order is going to come back and want to add three more pieces.

Marc V: They’re going to add three more. “Then, I’ve got to order three. I’ve got to wait for it to ship. It’s an extra day.” What you do is when you place an order for 40 caps, you actually order 44 caps or 48 caps. Now, you’ve done it. Maybe you messed up on a couple of them, or your customer called back and wanted two more.

But you’ve got three caps left. You have the opportunity to sell these as one-offs. This could be for tote bags, caps, whatever it is. Those are easier, because they’re universal sizes, compared to small t-shirts. But now you can send out a notification with a coupon, to your customers, for a one-off.

A one-off bag, like a little laptop bag, you might do for $59, for a custom designed one. Well, now you’ve got one in stock, ready to go. You’ve got two in stock. You can send out “Two left in stock, discounted. Regular $49.99. On sale $39.99. Put whatever logo you want on it.”

Mark S: I like that.

Marc V: Then, you sell both. When they’re gone, a customer “I saw that.” “Sold out, look out for the next time.” You create some scarcity, too, and that’s great.

Mark S: Or “How many of those bags do you usually buy?” And now you’ve got another opportunity. So, inventory management is a good reason to do couponing.

Marc V: And then, time management. Time is the next. May might be slower for you, and then June, you are slammed. You’re starving for business in May. In June, you’re almost turning away business. So, what do you do?

You contact your customers that you know normally order in June, and you offer them a discount promo coupon. “If you order before May 15th, I’ll give you 10% off your order.”

Mark S: That’s a very relaxing thought, because I know that we get calls from customers all of the time. “I’m in the middle of a huge order. I just ran out of ink. I’ve got ten orders behind it.” Or “I’m delayed, because I couldn’t get this accomplished.”

“All of my orders come in February, for Valentine’s Day. Then, I get nothing for four months.” There’s a lot of businesses like that.

If that’s your pattern, then it’s a very relaxing thought to be able to take maybe even 20% of that, and put them in the month before.

Marc V: Yeah. The thought would be – the initial thought, because there’s a micro-thought when it comes to marketing, and then there’s this larger macro-idea behind it. So, the initial thought is “If my customer is going to order in June definitely, why would I take less money for them to order it now? I’m losing money.”

Well, what also happens in June is, because you get an influx for your business, whatever the reason might be – you do resort wear, so they start to beef up when summer comes. What happens is you’re also not selling in June, because you’re busy creating apparel.

You’re also maybe possibly turning away business, not directly, but indirectly, because they ask you when the turn time is, and you say “I can’t deliver until July 1st.” So, you’re getting business that’s turned away, so you’re losing opportunity during that busy season.

What you do is you take the 10% reduction now, on the guaranteed business. They’re happy they got a deal. You’ve now freed up – let’s just say that’s a 12-hour order. You’ve freed up 12 hours.

Mark S: You could end up being the only person in town that can fill that order in two days, because you couponed it the month before. All of your regular customers are taken care of. And now, you’re getting new customers, because you did that.

Marc V: On top of that, your customer is really going to be happy that June has come, it’s time for them to restock their resort, whatever it is. It’s done! “It’s done! I can’t believe that! She called me up. She let me know ahead of time. She gave me a deal. It’s done early.”

Then, the review comes behind it. “Let me tell you why you should do business with Mary’s shop.”

Mark S: Yeah. And how excited are they going to be, to do something with you again?

Marc V: Yeah. “She’s going to remind you. If you order early, she gives you a deal.”

Mark S: I always liked Mary. She’s great.

Marc V: She’s awesome, she’s great! I think we’ve covered all of the topics. We’re kind of nearing the end of our time, so let’s wrap it up.

Mark S: The last thing I’ll say is that we really appreciate you guys participating with us, and watching and listening to the podcast. I hope you’ve noticed the new website, CustomApparelStartups.com. You can go listen to all of our 67 prior episodes, if you want to.

There’s 65, 66 hours of content on there, just about marketing small business, and specifically custom apparel. So, if you have the opportunity to check it out, please do. We’re getting better at searches, and putting keywords in there, so it’s easier to find what you’re looking for.

I also want to point out for everybody that came in late, that we are broadcasting from our Dale Mabry campus of ColDesi. The samples that you see behind us are of the Digital HeatFX line of products. They are from the SpanglElite. They’re from the Brush N’Bake cutter-based system. They’re from the Cut n Press cutter-based system.

All available through Colman and Company, part of the ColDesi Group.

Mark S: Yeah. And our podcast is going to be live consistently, on an upcoming basis. I think we’ve finally narrowed down our audio and video to the right zone.

So now is the time, if there are some folks who have some questions or want to comment right now, you can. We’re going to be monitoring on Facebook.

Mark S: Yeah. We’ll hang out for a little bit.

Marc V: But more so, what we would like to do is, when we announce what our episodes are going to be, and we’re going to be doing them live, that you might come prepared next time, or show up. So, if you’re just listening to a recording of this, stayed tuned via email and social media.

Mark S: Subscribe to us on YouTube, so you get the notifications.

Marc V: Yeah. Look out for the notifications on YouTube and on Facebook. This way, you’ll see when we’re live. We’ll have a consistent time, and we’ll get better at helping you guys with this.

During the show, if you have a question, you can go ahead and just ask. You’ll know what the topic is, and maybe you can think about it ahead of time. We’re going to really try to take this to the next level for you, so it’s not just about listening to the podcast, but it’s about participating, and helping us create questions, answers, events, and being a part of the podcast with us.

That’s what’s really going to make it better, I think.

Mark S: Yeah. It’ll be fun. Okay, thanks everyone! This has been Mark Stephenson, from ColDesi.

Marc V: And Marc Vila, from Colman and Company.

Mark S: You guys have a good business!

Marc V: Thanks!

 

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