“How do you build value in a short amount of time with a transactional customer?” [MILESTONE VIDEO]

Milestones for Small Business are weekly answers to questions from small business owners across the world. At the end of a year, we’ll have a created a 52-point roadmap to small business success.

Milestone for Small Business #2

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“How do you build value in a short amount of time with a transactional client?”

It’s very simple.

Give them the cheapest price.

You’re not going to build any sort of long term value – any residual value.

If you want to attract transactional shoppers, lower your price.

Pricing item event and sale outs are the only way you’re going to attract them. But be very careful.

The same is true with Groupon-type marketing; it can be a shot of cocaine man, right up your nose, directly into your bloodstream.

You’re going to see traffic. You’re going to see people coming into your store. Your phones are going to ring. And you’re going to be really attracted to this type of marketing.

Here’s what going to happen the next time you try it: It’s going to work a little less well.

And then the time after that it’s going to work a little less well than the time before. So before long, just like a junkie, you are going to have to discount your prices lower and lower and lower.

It’s a dangerous game to play.

What happens to junkies in the end will end up happening to you if you try to build value in a transactional type customer.

Here’s a quick video describing the differences between the two types of customers: relational and transactional.

Click here if you can’t see the embedded video.

I’m Tim Miles of The Imagination Advisory Group. Thanks for joining us.

Have a successful week.

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