Principled Profit: Marketing That Puts People First

Rating:
Summary: Great Book Shows How To Market Ethically.
Review: "Principled Profit: Marketing That Puts People First" by Shel Horowitz advocates that companies should market ethically and honestly, not only because it's the right thing to do, but because it creates the most long-term success for a company by building customer loyalty.

Horowitz says companies should follow the principles of quality, honesty, and integrity. He writes, "Create value for others in everything you do. ... You help yourself best when you're helping others."

"Principled Profit" tells us that many years ago, Arthur Anderson, an accountant struggling to build a new accounting firm, was pressured by a client to overlook accounting irregularities. Even though Anderson faced a cash-flow crunch due to an upcoming payroll, he refused to compromise his integrity. He'd rather lose the client than misrepresent a company's financial statements to mislead investors.

Seventy years later, corporate greed and the willingness to turn a blind eye to similar accounting irregularities at Enron, led to the complete downfall of the company Arthur Anderson founded.

Horowitz says companies that try to duck their responsibilities, hide their mistakes, and mislead consumers are eventually punished. Companies that market unethically and fail to deliver quality are in a perpetual hunt for new customers, have little repeat business, and have few referrals.

Quoting a Nortel study, Horowitz writes: "a mere 5% increase in customer retention can translate to as much as a 75% increase in profitability." We learn it's about five times more expensive to find a new customer than to keep an existing one.

Horowitz says customer acquisition costs vary depending upon the product. For example, we learn that amazon.com had a customer acquisition cost of only $7 by 2000; an online travel discounter might have a customer acquisition cost of $8.66; and a mortgage firm might have a customer acquisition cost as high as $700.

For a typical firm, a Gartner study suggests that it costs $280 to acquire a new customer and about $57 to retain a current customer. Horowitz concludes that companies selling a product priced at $100 probably lose money on new customer acquisition and make money on repeat customers. Thus, if they are to survive, small businesses should work diligently to build repeat business.

Horowitz writes: "By failing to deliver a positive experience to the customer, you're pretty much assured that he or she will go elsewhere... and tell friends and colleagues to do the same."

Horowitz says some "sales jerks" argue that the only way to be successful is to be aggressive in cold calling-that success is a numbers game, the more people you call, the more sales you'll make. Horowitz shows this philosophy is flawed, because it fails to build goodwill and repeat sales.

Horowitz writes: "I never make cold calls. I create marketing that has the prospect calling me. When I get the phone call...they're already convinced that I can help them." Horowitz owns Accurate Writing & More ... which creates publicity releases and other documents for clients. (Horowitz writes press releases for many authors and small book publishers and is highly respected in the small press community.)

Though he receives business from 80% of the prospects calling him, Horowitz says most of his business comes from repeat clients who find that his press releases can be six times more effective than their company's in-house press releases.

Horowitz writes: "Since my primary customer-retention strategy is to deliver superior work, at an affordable price, and within a reasonable time, my cost to keep an existing client is close to zero."

Other suggestions from "Principled Profit":

* Don't view business as a competition for scarce resources. Rather, see things from a viewpoint of abundance and learn to work with your competition rather than against it. Consider exchanging referrals and subcontracting work when it benefits everybody.

* Consider using e-mail discussion lists to promote your services to people who might be interested. But, don't use spam. Spam destroys credibility.

* Profile your best customers and figure out how to find more just like them. Don't try to sell your products or services to those who don't need them.

* Network with organizations that serve your customer base and become a preferred or endorsed supplier.

* Ask prospects: "What is the biggest problem you face?" And, then, listen. If you can't offer a great solution, turn down the business.

Horowitz says knowing when to say "No" to business is important. If the job would compromise quality, integrity, or honesty, you should turn it down.

For example, Horowitz points out you should turn down business if:

* You don't offer an appropriate solution (honesty).

* You don't have enough time to do the job well (quality).

* You find the job morally distasteful (integrity).

"Principled Profit: Marketing That Puts People First" by Shel Horowitz is a great marketing book for small business owners who are looking for a better way to build a long-term business.

Rating:
Summary: Practical, refreshing, and deceptively simple
Review: As an advertising major in college turned off from the profession's focus on selling of products people don't really need, as a consumer all too often exposed to screaming car dealership commercials and bait-and-switch tactics, and as a new business owner... I was definitely interested in what Shel Horowitz had to say in this book!

The very first sentence, on the very first page, was sheer delight. As it happened, that page (and the five pages following it) contained endorsements and blurbs by the very well-known in the marketing field... and here's how the author introduced them: "Many of these blurbs are shortened for space reasons... The complete versions are posted at ." My goodness! How many times have I, as a movie and book consumer, been deceived by three words taken completely out of context of a review? Not this time! This first sentence promised an entirely new approach.

The book includes practical advice ("Run your business in alignment with your core values; don't try to be something you're not") as well as practical statistics (i.e. "Gay and lesbian purchasing power is about $400 billion"), both of which a business owner can certainly use. While the practical advice may sometimes seem simple, in reality it is not. Using the example above, how many times, purely in a social setting in which literally nothing is at stake, are people tempted to try to be something they're not? How much more so when one's livelihood is on the line? The author's reminder is both apt and profound, and something to be taped to the top of one's computer monitor.

The author's marketing strategy is also both strong and logical. "I create marketing that has the prospect calling me!" is a typical example. Again, on first approach it seems simple---but few marketers take the time to really create the draw or pull that will create action in a consumer who really does need the product or service. Instead, we have announcers shouting to us over the radio that they will not be undersold! What difference does a car dealership's competitive ambition not to be undersold make to me as a consumer? Nada. On the other hand, last year while I was half-mindedly watching mortgage rates dive even lower, I received a simple, thoughtful letter from a mortgage broker giving me concrete information on how much I could expect to save at a certain interest rate compared to my current interest rate, how I could pay for the refinancing closing costs, and the steps to take to contact him to do it. I did refinance with that mortgage representative.

Some of the advice given in the book is fairly standard, but many other suggestions are both practical and new. And it's refreshing to see an author writing about turning down a sale when it's not right for him---and not necessarily for the reasons one might think.

CONS (1) Initially, I wished for less examples from the author's career and more from other companies. I did get that wish later on in the book (he cites some very interesting examples, in fact, such as Rosenbluth International, which "will go so far as to open a new branch office, just to serve a new account"); it just can take patience to get there. (2) The author extols two techniques which just did not ring right: flattering a prospect/playing into that person's ego, and putting time pressure on a person when it might not be the right time for the person to buy the product. These stood out all the more because the rest of the book is not like that. (3) One begins to wish the author would stop mentioning his other book, as one begins to feel that one is a sitting duck for a repetitive sales pitch. Enough already!

PROS (1) This book led me to question things I never thought to question, but should have; for example, the sentence "We need to gain market share" (read: we need to take some market share from a competitor). (2) The book serves as a great reminder where to put one's priorities. Beyond integrity and personal satisfaction (which is, after all, why we live life), for instance, the author quotes the CEO of Southwest Airlines, who reminds us, "Market share has nothing to do with profitability. Market share says we just want to be big; we don't care if we make money doing it. To get an additional 5 percent of the market, some companies increased their costs by 25 percent." (3) A balanced approach to many issues; I respect an author who gives both sides of the story or both pros and cons to an approach. (4) The book uses examples with which everyday consumers and readers will be familiar; for instance, a grocery store chain that pioneered the reservation of parking spaces for pregnant customers, and the office supply chain which rearranged its stores to steer its customers to the right technology for what they needed (I believe that's Office Depot).

(A note on the rating: The lack of half-stars on the rating scale didn't give me a good option for an accurate rating. At the time of this review I have only given 5 stars to one book, and not many four-star reviews, either. This book is above average. If I could have given a rating on a scale from one to ten, I would have given it a 7.)

The author makes a bold statement in Chapter 3: "Does the last chapter mean there's no place for salespeople anymore? Not at all---but it does mean that some businesses don't need a sales force if their marketing is properly effective." Bravo!

Rating:
Summary: The world needs more ethical marketing
Review: Books on ethical marketing, like this one, are sorely needed in today's world. Shel Horowitz's "Principled Profit" is a winner--and one of the best books on the topic of ethical marketing that I've seen. Buy it for your CEO.

Rating:
Summary: You Don't Have to Be "Marketing Slime" to Succeed
Review: Do you believe that marketing means doing anything to get the sale and do in your competition? Shel Horowitz disagrees, and in this book he shows how putting people first can make you a marketing success.

In "Principled Profit," Shel Horowitz says that nice guys don't finish last. Honesty, integrity and quality are keys to building a successful business with repeat customers. According to Shel, "Too many businesses see marketing as a weapon of war. They think that to succeed, they have to climb over their competitors, fool their customers, and herd their employees into constricted conformity. I think that's just plain wrong."

According to Shel, you can create value in your own business by creating value for others. Form partnerships with customers, employees, suppliers and even your competitors. You will succeed by helping others to succeed. In an atmosphere of trust and cooperation, they will become a marketing force for you, spreading the word to others who will want to do business with you.

You can put the ideas in "Principled Profit" to work for you by only taking on customers you can serve well, networking and forming alliances with complementary companies and competitors, being honest in your copywriting and advertising, and treating those you deal with the way you would like to be treated.

Shel Horowitz is a highly-respected copywriter and marketing expert, and both the "how-to" and the philosophy in this book make it clear why.

Rating:
Summary: Deserves a wide audience...
Review: Horowitz has done all the legwork so you don't have to! Everyone in business needs this book, especially if you never had the opportunity to take a marketing course in college. Take advantage of the author's twenty-plus years in the business and apply the concepts to your own situation.

Rating:
Summary: He walks his talk so it's not all feel good theory
Review: This is a refreshing, wonderful and practical book. Shel Horowitz tells you that integrity is not naiveté and that you can stand up for what you believe in and still make a profit. I'd like to thank the author for his contribution and for enriching me both personally and financially. Bravo!

Rating:
Summary: He walks his talk so it's not all feel good theory
Review: This is a refreshing, wonderful and practical book. Shel Horowitz tells you that integrity is not naiveté? and that you can stand up for what you believe in and still make a profit. I'd like to thank the author for his contribution and for showing me to enrich myself both personally and financially. Bravo!

Rating:
Summary: Feel Good About the Marketing You Do!
Review: This is the sales and marketing book for the folks that don't want to feel sleazy about the whole process. Shel Horowitz shows how to sell more while doing good for the world and feeling good about yourself and your efforts. He gives specific, practical examples of people and organizations that are doing the things he advocates, and talks about ways to adapt the techniques to a variety of situations.

I purchased this book because I had seen samples of Shel's advice on the publishing community lists to which I subscribe. (That participation is, in fact, a perfect example of the kind of conduct advocated in this book.) I wanted to learn more about how to market my own consulting company. I did, and it works.

Rating:
Summary: Win/Win Marketing Does Work, Really
Review: True win/win marketing is the ideal everyone in business should strive for. Shel Horowitz's Principled Profit, Marketing That Puts People First is the definitive book on the art and practice of win/win marketing. He shows you how to create marketing that not only helps your own business, but by helping another business simply passes around success that enhances every business or situation it touches.

Horowitz not only practices what he preaches, he lives it. With true examples, he shows how the system works for just about every business situation imaginable. He shows that even helping your competition can help you help your own business.

Perhaps "principled profit" should be made the new mantra of business. Practicing Principled Profit bodes well for business, as well as in our personal lives. What a wonderful world this could be!

Well recommended for anyone, not just business people, looking to make a positive mark in this world.

Kitty Werner, author, The Savvy Woman's Guide to Owning a Home; How to Care For, Maintain and Improve Your Home, published by RSBPress.