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Neighborhood Marketing Use your creativity and marketing smarts to attract a loyal following of local customers to your biz.

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As a small-business owner, one of the most effective ways foryou to compete with big-name, big-budget companies is to unleashthe power that's right in your own backyard. Your secretweapon? Neighborhood marketing--and building an effective strategyis crucial to your success.

Let's talk about what neighborhood marketing is. It's away to run your business, a philosophy that focuses on satisfyingyour customers at a higher level. Neighborhood marketing is asystem that concentrates on building your business from the insideout, and never farther than a five- to 10-minute drive from yourcompany's front door. It takes what you create within the fourwalls of your business and serves it up as a"concentrate" in high doses to those who can have thegreatest impact on your business.

The neighborhood marketing philosophy is one that keeps youfocused on the tools you already have at your fingertips: youremployees, your products and services, and a database of yourcustomers and internal merchandising strategies. By developingthese areas to make them the best they can be and leveraging thesetools just within your neighborhood, you'll be able to takeyour company to new heights and grow your sales consistently.

Why concentrate your strategy on customers who live and work nomore than a five- to 10-minute drive from your location? That'swhere the overwhelming majority of your best customer's comefrom. If you have any doubts, just ask each of your customers'for their zip code for the next 7 days. Then plot them on a zipcode map (easily found in most phone books). The proof will beright there before your eyes.

Understanding the importance of your marketing area will alsohelp you realize that using mass media to advertise your businessshouldn't even be an option for you. While the allure of TV andradio ads can be intriguing, for neighborhood businesses, it'soften the fastest path to bankruptcy. Mass media covers an enormousamount of geography, which you're paying for. So why reach outto those who will never drive the distance to see you?

Getting Started

So where do you start? As obvious as it may seem, you begin bybeing a good neighbor yourself. Maintain the appearance of yourbusiness--keep it clean and professional. Be sure your location ismeticulously maintained and looks like a place you're proud topull up to each day. A business that is unkempt or untidy givescustomers the impression that this is how you'll conduct yourbusiness. First impressions really do count.

Next, look for opportunities to get involved in neighborhoodfunctions, like sponsoring a little league team. Consider having acustomer appreciation party. Think of yourself as running thegeneral store of years past, where the owner knew the names,birthdays, anniversaries, fortunes and misfortunes of each andevery customer. These general store owners were involved in theircommunities, churches, local festivals, fundraising events and thelike.

Seek out neighborhood gatherings and figure out how you can getinvolved. Imagine dropping by a neighborhood block party with acase of free refreshments courtesy of your company. How aboutsponsoring an activity for the children at one of these events?Show you care about the firefighters and police officers in yourarea by sponsoring a discount day especially for them. These kindsof activities are what ignite the buzz within yourneighborhood.

Focusing on your neighborhood requires a focus on those that arenew to your area--don't miss an opportunity to welcome newneighbors. Did you know that the average American moves every 5years? That means that as many as 20 percent of your currentcustomers will move in the next 12 months--and that many new peoplewill be moving in. So buy a list of the new residents that moveinto your market area each month, and send them a coupon for a freeproduct or service to familiarize them with your company.

Whether you operate a restaurant, flower shop, dental office,dry cleaners or some other neighborhood business, new neighbors canbe an important element of your neighborhood-marketing plan. Newmovers will spend more money on products and services during thefirst 60 days than an established resident will spend in 2 years.They're also open to trying new product and service providersduring this all-important "habit forming" stage. In someindustries, redemption rates on new neighbor programs can runstrongly into the double digits.

Just ask Ray Villaman, a Dryers Ice Cream shop franchisee inOakland, California. "We consistently pull a 20 percentredemption rate on our new neighbor program," says Villaman."This is something we do on a regular basis with newneighbors--we always give them a free sundae at no cost to them atall. It isn't long before we notice their faces again and againwith repeat business."

While marketing to new neighbors often translates to just a fewhundred names each month, over the course of a year, that can meanseveral hundred new faces that come into your business. Make yournew-neighbor offer compelling, and you can reap huge rewards fromthis profitable group.

Developing Ideas

One of the most effective things you can do is create excitementabout your business. And that doesn't have to be expensive.Think of low-cost things you can do that will create a buzz aboutyour business, things that will get people talking.

Here's a great example: I had a friend who once owned asmall café that only had about 20 tables. One of the tableswas close to the door, and no one ever wanted to sit there. Oneday, my friend decided to label the table "the worst table inthe house." Best of all, if you opted to sit there, he'dtake 50 percent off your entire bill.

Did he see results? You bet. His brainstorm created a buzz abouthis café. Within a week, people in the neighborhood weretalking about his café and the table they'd sat at lastnight where they got their dinner for half price. There were someevenings when people would wait as long as 45 minutes to get thattable. This type of internal marketing is what fuels word-of-mouthadvertising within your neighborhood, and it doesn't take bigadvertising dollars to do it.

If you lack the creativity to develop these neighborhoodmarketing ideas on your own, don't worry, there are resourcesyou can turn to for help. One of the best I've found is TomFeltenstein's book on the topic, Tom Feltenstein'sEncyclopedia of 401 Proven Killer Promotional Tactics.

The bottom line is, you don't need to have a hugeadvertising budget or hire an advertising agency to help youcompete with big budget companies and win. Neighborhood marketingis about competing in the trenches that exist within your ownbackyard. It's about relationships, creativity, greatmerchandising, great employees, and knowing your customers andexceeding their expectations. Effective neighborhood marketingtactics are at the core of the most successful small businesses inthe country--and many of the billion-dollar companies that havemade it, too. The successful delivery of this is a lot harder thanwriting a check to place an ad, but without adopting itsprincipals, there's no reason to be in business.


Brad Kent is the president and CEO of SmartleadsUSALLC, a specialty list and direct mail services company in PalmHarbor, Florida.

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