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How do you find what makes people part with cold, hard cash?

Written by Nicola Barron on Saturday, 08 September 2012. Posted in Start-up Diaries

The second instalment of columns from EB columnist Nicola Barron explores the difference between what customers say they want, and what actually pays the bills

How do you find what makes people part with cold, hard cash?

There’s a song that my seven-year-old finds hilarious. It’s about a duck who goes up to a lemonade stand and asks the man running the stand if he has any grapes. “No, but we’ve got lemonade; it’s cold and it’s fresh, can I get you a glass?” says the man. “I’ll pass,” replies the duck and he waddles away. This carries on over several days until the exasperated lemonade seller takes the duck to the store and buys some grapes, offers them to the duck who declines with a “No thanks, but do you think this store sells lemonade?”

One of the major realisations in my first year of running my business Homemade London was that the Duck Song is a pretty accurate portrayal of what it’s like to run a small business. Because there’s a big difference between what customers say they want and what they actually want.

For example, the Sewing Café part of our business, where we offer our customers sewing-machine rental by the hour, is the aspect of our business that is the most talked about. We’ve had a full-page feature in the Independent on Sunday, have appeared on TV, and I still get tweets and emails from people congratulating us on our great idea. We even get visits from people around the world who want to set up their own Sewing Cafés. It’s an idea that’s truly captured people’s imaginations. How much money do we make from the Sewing Café? On a good week, £20.

While I doubt our Sewing Café will ever have our bank manager jumping up and down with glee, from a marketing perspective it’s been a massive success. With minimal outlay and by running it at times that never interfere with the profitable side of the business, we’ve gained publicity that would have cost us thousands to buy and have managed to attract many customers who first fall in love with the idea of a Sewing Café but mostly end up booking a workshop or a party with us.

So, if you can’t trust what people say they want, how do you find out what makes people part with cold, hard cash? For me it’s been a journey of discovery. The best piece of business advice I’ve ever received – which has stuck with me ever since – has been to “f*** up often, but f*** up cheaply” (this advice was given to me by my hairdresser, who, happily, hasn’t applied that philosophy to my hair), and it’s held me in good stead. We’ve experimented with as many marketing initiatives as we can, as quickly as we can. We found tapping the large online populations of sites such as lastminute.com, Living Social and, to a certain extent, Groupon useful at
the start to raise awareness, but the single most important thing we’ve done is to embrace social media – the ultimate low-risk marketing tool for any business. An example of this was our ‘Drawers Wars’ competition on our Facebook page, where we asked people to vote for their favourite pair of knickers made in one of our lingerie workshops. It drew in lots of new followers, as friends-of-friends were urged and incentivised to comment and like our page. And we regularly incentivise customers to sign up to our newsletter by running giveaways of low-value items such as tote bags and badges, (interestingly enough we always get a much better response offering low-value competition prizes).

By taking the opportunity to listen and engage with our customers as much as possible, we’re beginning to get some sort of knowledge of what they want, and behaviour patterns are starting to emerge – with a few surprises along the way. Just this morning, we signed a lucrative deal with a film crew to hire our Sewing Café. Onwards and upwards...

About the Author

Nicola Barron

Nicola Barron

Barron wears many different hats: she runs her craft workshop business Homemade London, is mother to two small children and step-mum to another, and still finds time to write Elite a column each month. The start-up diaries detail the various ups and downs of starting a business. They are plentiful.

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