Show notes
The idea of The Four Quadrants of Promo Sales (i.e. The Four Mores) is to recognize that if you're just focusing on one thing -- bringing in more clients -- you are very likely missing out on 75% of the available profits that are going to come from these other three quadrants.
The Four Mores
David: Hi, and welcome to the podcast. Today, co-host Jay McFarland and I will be talking about The Four Mores: More clients, more money, more margin, more often. Great to see you again, Jay.
Jay: Yeah, it's good to be here. And I feel like there's one more more, if you can get all of those. More happiness and more peace of mind, right?
David: Yeah. That's true. There are more than four mores.
Jay: Yes.
Quadrant #1: More Clients
David: I think that what we're thinking of here is that these four mores are designed to increase the value of our clients and increase the value of our businesses. A lot of times when people are thinking in terms of growing their sales and profits, they think in terms of the first more. They think in terms of more clients.
“I need to get more clients, “I need to get more business.” And so many business owners focus their time and attention exclusively on bringing in more customers. And sometimes what ends up happening is they forget about the ones that they have. And they start to lose track of the fact that they could be drifting off.
Anyone who's been in business for any length of time has heard the old adage that it costs a whole lot more to bring in a new customer than it does to resell an existing customer or to satisfy an existing customer.
Stop Missing Out
But it's easy to lose sight of. And so the idea of The Four Mores is to recognize that if you're just focusing on one thing -- bringing in more clients -- you are very likely missing out on 75% of the available profits that are going to come from these other three quadrants.
Jay: Wow. That's very good. And kind of like we talked about last time, moving people into that center zone, that loyalty zone. Right?
David: Yes.
Jay: And then, if they're reoccurring, I mean it just makes life so much better. If you have a loyal base and then you're bringing in more clients, to me it's just the perfect pattern, right?
David: Yeah, it does. So now we've got sort of conflicting visual images, however. Because last time we were talking about a target. Now we're talking about quadrants, but it's all designed to accomplish the same thing. Which is to get more of our clients buying from us more often. Spending more money with us at higher profit margins so that we can continue to grow the business, service those people. And without the profit part of it, you're dead in the water. I mean, you cannot continue to operate without that. So each of these four components is absolutely critical to being able to grow the business the way that we want to do it.
What About Quality of Life?
Jay: Yeah. A good, healthy business that is making money, is growing, has loyal customers. And hopefully giving you peace of mind and maybe some quality of life. Right?
David: Exactly. Yeah. Quality of life is a nice bonus for some people . It should be a requirement, but it's not always a requirement. Sometimes we sacrifice quality of life just to reach our financial goals. Sometimes, particularly in the early stages of a business. But eventually, yeah, we learn.
But one of the things about this topic that I think is so important is that when you look at each of these four elements and you focus on them and you focus on improving them, it does improve your quality of life.
Because now you're not investing a lot of time on aspects of the business that are less important. Because if you think about the idea of bringing more clients through the door, obviously that's an important consideration. When you think of the idea of when I talk about more clients, more money, more margin, more often. More clients, we bring more clients of the door.
Quadrant #2: More Money
David: More money. Well, what does that mean? It means that we can potentially increase the value of each transaction with someone. If somebody spent $500 with me before, can they spend $750 with me next time? Or can they spend a thousand next time? And again, it's not just about increasing prices.
It's about providing more advanced solutions. In some cases they that are worth more money to them so that we can charge more. So we can sort of ascend them up that ladder.
Quadrant #3: More Margin
More margin, the things that I'm selling. Is there sufficient or can there be more profit margin built into that sale? Sometimes our focus is so much on being competitive on price that you can cut your way to lower prices. But at some point it becomes counterproductive. Because if you are losing money on every order, then volume is just going to kill you faster.
Jay: mm-hmm.
David: So we have to make sure that we're balancing the idea of charging something that's fair. But also maintaining enough of a profit margin so that we can continue to do what it is we do.
Quadrant #4: More Often
And then more often is about increasing the frequency of purchase, getting people to buy from me again and again. If somebody is currently buying from me once a year and I can get them buying from me twice a year, I have now doubled my business with that customer. If I can get them to buy three times a year, I've tripled the business, assuming it's all even. And if I'm able to increase the value of each transaction, that goes up as well. And then those things tend to build on each other.
Jay: Yeah, we've kind of done, and I know we will do a deep dive on each of the mores. I feel like what you're saying is, it's important to know each one is there. And if you're too heavily loaded in one quadrant, then you're going to create possible problems for yourself. Or, you're not getting the advantages that can come from focusing on those other quadrants. Maybe finding balance in the force, if you will.
David: . Yeah, exactly. And one of the things that we touched on earlier when we were just talking about the idea of more clients, is that when you do focus too much on one particular quadrant, the other ones tend to go away. And so when I'm focused too much on bringing new clients through the door, my existing clients are not hearing from me as often. And I can potentially lose business from that. So I lose aspects of the other mores. I lose the idea of more frequency of purchase from my existing customers because I'm off chasing the next shiny object or the next new client.
Diluting Your Efforts
Jay: Yeah. And I see this in businesses a lot. Where a business has a good product, but they decide, you know, if we just come out with 10 other products… and they dilute their products and that can hurt them. Entrepreneurs typically aren't entrepreneurs because they know how to balance and run a business. They're entrepreneurs because they have a skill set and they can create a product that people like and want. But that doesn't mean they know how to run a business and find balance with these quadrants.
David: Yeah. It goes back to The E Myth, Michael Gerber's book that we had talked about in an earlier podcast. I thought he expressed it so well. He talked about the fact that businesses are generally not started by entrepreneurs. Businesses are started by technicians suffering from an entrepreneurial seizure . And so…
Jay: Yeah.
David: …if I'm an electrician, I start an electrical business. If I’m a disc jockey, I start a recording business or something like that.
Jay: Mm-hmm
Technical Skills vs. Operating a Business
David: Failing to realize that just because I'm good at the technical skills of a business, doesn't mean that I know anything about operating a business that performs those technical skills. If I'm a plumber, and I know how to plunge toilets, it doesn't mean that I know how to set up a plumbing business, hire people, buy trucks, invest in real estate, train people, manage people, get customers, manage customers. I don't know any of that stuff.
Jay: Yeah.
David: And so many business owners fall into that trap.
Jay: Yeah. I feel it's more common than not. And so when you're talking about The Four Mores, I feel like you probably should even just get out a whiteboard or something and draw the quadrants and start kind of mapping out your systems for each of these.
Map Out The Four Mores
David: Yeah. It's a good way to start. Just keeping it visual, right? Getting it to be visual. And I think, again, what we should probably do is just post something on the website next to this podcast where someone can download it and they can tack it up on their wall. We're going to fill up your walls with stuff.
Jay: There you go.
David: Things that you can do to keep track of what it is we're talking about here. But yeah, recognizing that. Because if you looked at something… if you looked at something like that every day and you say, “okay, more clients, what am I doing today to bring more clients through the door? Am I doing anything? What have I done this week to bring more clients through the door? What have I done to raise the amount of the purchase, to generate more money,” right?
Getting Beyond Just Getting Clients
David: Other than more clients, what have I done? Is there a product line that I could introduce that is a little more expensive that would serve their needs even better? That could increase the average value of the transaction. Is there a product line or is there something that would also increase the profit margin on that?
So if I can increase the number of customers and if I can increase the average value of the transaction and I can increase the profit margin on those transactions, and I can get people to buy for me more often, then all of those things end up working together.