How to Turn a (struggling) Business Around Fast

There are many things that can cause a business to?struggle?or fail. It could be suffering the side-effects of the pandemics, lockdowns and the resulting loss of business. Founders may have lost energy or enthusiasm, or they may be enduring personal problems like a bereavement or divorce. or it could be more operations like spiralling ad costs, increased competition, legislation changes; the sales and marketing that once worked well may no longer be working.

Here are 7 relatively simple stages virtually any business can implement to turn itself around. To ‘sweat out’ the maximum amount of cash in the shortest possible time, using resources already available.

Certainly, it would make sense to pursue cost-cutting measures too, but these are outside the scope of this article. I want to focus on how you can increase revenue without necessarily increasing (or reducing) costs.

It’s often far better to trade your way out of a challenge or to weather hard times by increasing sales and cash flow, rather than slashing costs to survive. Here’s how it’s done

1. Identify your lead source KPIs

The lead source KPI is one of the most important KPIs (Key Performance Indicators) in any business – it reveals where and how you found your most valuable clients.

You cannot master what you do not measure. Tracking KPIs takes the emotion and the guesswork out of business. To work it out your lead source KPIs, you must track exactly where your clients originally come from. Which specific ad. Which specific referee. Set the tracking systems up NOW. If you can go back and find the origin lead sources of your clients, then do that now.

2. Rank your best clients

You may have ten or 100 ‘good’ clients who’ve each spent say ￡10k with you, and 100 or 1,000 ‘general’ clients who’ve each spent ￡1k with you.

Set up a spreadsheet or Googledoc with two separate tabs and divide the clients up. Tab one is your very best, top clients. Tab 2 is your second string clients. Then rank every client based on total spend, highest to lowest.

With both lists ranked, then note which specific advert or marketing campaign brought each client to your business. What keywords, platform or social media channel did they find you through?

Add another tab to your spreadsheet containing this lead source data. Collate the information from the other two tabs and rank your lead sources, top to bottom. Which lead source has the highest volume of leads, and quality/revenue of leads.

I always ask clients how they found me. Those attending high-price mastermind sessions have usually encountered me via my podcast “Disruptors”?or through one of my books - Money or Life Leverage. My top clients consistently come from these lead sources. So I’d be wise to invest more time, resources and cash in advertising and marketing in these areas.

I made a significant mistake of turning off Amazon book adverts during the pandemic, as this lead source may have been ￡10k a month, not direct response and difficult to track.?In many cases each book sold cost far more in ad spend than it made in revenue. I’ve since recognised that since these are my most valuable lead sources for top clients, they represent a worthwhile advertising expense (investment), even if they are a ‘loss leader’. I used to be obsessed about getting a good ROAS (Return on Ad Spend), now I am far more interested in the LCV (Lifetime Client Value).

I’d happily spend ￡50 for a ￡10 book sale, if it meant gaining a client.

3. Create an ‘ideal client profile’ (ICP)

With your top clients and lead sources ranked, you should now call all your best clients and ask why they chose you, what they like about you, what you could do to improve, and collect as much data as you can on their profile.

From all the data you’ve accumulated you can better package your products and services, better understand what marketing they are drawn in by, from which platforms, as well as what they like about you. You know their pains and problems. You know their desires and goals. You’re ready to define your perfect clients, and therefore find it easier to attract more of them.

You can predict their approximate age, sex, demographic, preferred social media platforms and which media they consume, all based upon what you’ve learned from analysing your existing top clients and their preferences.

From your ICP, you can also define your negative ICP; the customer types not a good fit, who you do not want to attract. They may not be able to afford your service, might cause you customer complaint issues or simply do not need or want what you have to offer.

4. Redefine where and how to market your business

Using the knowledge gained from gathering and analysing your client data, ICP and lead source KPIs, you can reverse-engineer this back into your marketing activities.

Redefine how you target new clients, what keywords and ad groups you use on your ads, and what platforms and social media channels you focus on most. This will dramatically improve your chances of gaining more of your ideal clients, at a lower cost, higher return and higher volume, using the types of campaigns that worked to win similar clients in the past.

Your adverts should convert more often and you’ll get a better return on your marketing expenditure (ROAS) since you’re now focusing on the channels that yield the best response and conversion.

This strategy works well in businesses generating 6, 7 and 8-figure revenues and yet most business owners don’t bother to do it. Maybe it didn’t occur to them, or they’re too busy being busy?

5. Extract upsells, cross-sells, down-sells and renewals out of your existing client-base

Your next task is to call up your clients three times each over a period of two weeks.

Call number one is a simple catch-up: “Hi, how are you doing? Given recent hard times, how can I serve you better? What should we start doing, stop doing and keep doing?” (Start Stop Keep)

Ask for permission to call back if you should start to offer the services or make the improvements they’ve suggested (which you will!).

The second call a week later is used to upsell, cross-sell, down-sell or renew the client based on the feedback they gave you in the first call.

The third call, a week after the second is to ask for a referral of someone they know who might also value your services. Remember that your source of new best clients is your existing best clients, so ask your existing best clients to refer new clients like them.

6. Build an ambassador/referral program

Referrals are an essential part of a comprehensive marketing strategy, but you should not rely on just them.?Referrals typically come through an ambassador, referral or affiliate program. People who say “I get all my business from referrals” are usually very small, have not mastered advertising, or are sitting on a Golden Goose but not allowing it to lay eggs.

Formalising an ambassador program can generate significant business, but it won’t happen by accident. You need a formal outbound communication plan to ambassadors, as well as reward schemes, leader boards and competitions to motivate them. Empower ambassadors to seek out your ideal clients on your behalf. Some want financial rewards, others vouchers or gifts, others discounts on your services, and some just enjoy doing it. Give all these options.

7. Collaborations and partnerships

You may know of companies that are like yours and others that are different but complimentary to yours. What types of businesses exist that could appeal to a similar ideal client as yours? Form alliances and reciprocal promotions for similar and different/complimentary companies, to help each other grow. Hackett and Aston Martin collaborate. Swatch with Omega. Bang & Olufsen with German car makers.

Ask your top clients what other products and services they use. This could be a shortcut to finding businesses with which you can create joint ventures, partnerships and affiliate programs.

Follow these 7 steps consistently, refining them over time, and scaling your business will be more predictable and repeatable, and more immune from disruptions and recessions.

I hope you found this useful, and remember, if you don't risk anything you risk everything

Is there anything you would or do you have any Qs for me?

Rob Moore