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Last Update: Thursday July 2, 2020

Key Idea: Build a Database

Building a database should be one of the primary components of a business owner's total business plan. It's absolutely critical that you retain key information about your customers.

Key Question:

A: 

Carol maintains a database that includes the name, address, phone number and purchasing history of her customers. She sends direct mail to them regarding specific items they would find interesting. She also reaches customers with print and radio advertising.

One technique Carol uses to grow her mailing list is to rent the list of a business that has customers like her customers. She told us about renting the one-time use of Bon Appetite’s mailing list for the Zip codes in and around Madison.

Everyone who responded to her mailing by using the coupon or returning the response card is now a permanent part of Orange Tree Imports’ list.

Many people dream of having thousands of customers but only a few do the work that must be done to find and win them. In the book, Good to Great, Jim Collins writes that great companies pay attention to details and no task is too tedious.

Scott and Marthalee Mooney, founders of Country Supply, used the good-to-great strategy and didn't even realize it. They wanted to build a list and no task was too small. Scott and Marthalee hand-copied the names and phone numbers of people who were selling horses or equipment from newspapers' classified ads sounds very naive. However, he was only 22 years old when he started the process of building a mailing list. Scott did what made sense to him at the time. He did what he could afford.

Eventually he thought of buying lists from magazines and over time he learned how to find qualified names with less effort.

Of course he was naive in 1984 -- but not now.

Scott is a perfect example of a person who eventually learns by trial and error and he is perfectly happy with this technique. In fact, he would probably argue it is the only real way to learn.

To grow your database you can try Carol's technique and/or work with a list broker. First do a profile of your existing customers and your best customers and determine their demographics and the psychographics. If possible, determine why and how they purchase from you. A good list broker will know how to find additional lists of people who look like your best customers.

Think about it

What tedious task needs to be done for you to move your business forward? We guarantee, it is something that no one wants to do.

Clip from: Orange Tree Imports with Carol Schroeder

Madison, Wisconsin:  Meet a guru of specialty retail, Carol "Orange" Schroeder (just above). She is the author of the book, Specialty Shop Retailing,  and she truly walks her talk. With her husband, Dean, they started their business, Orange Tree Imports, soon after graduating from college. That was 1975.

Today Orange is a master retailer and a quiet hero in her community. She was an early leader in the movement to revitalize the old downtown. Soon after buying the building on Monroe Street, Orange organized a neighborhood business association to do joint marketing-and-promotion to change the orientation of their old shopping district to be a vital area for specialty shops and restaurants. That worked miracles. Monroe Street now draws people from well beyond the neighborhood, even Wisconsin!

Go to all the key ideas and video of this episode...

Orange Tree Imports

Carol Schroeder, Founder

1721 Monroe Street
Madison, WI 53711
608-255-8211

Visit our web site: http://orangetreeimports.com

Office: 608-255-8211

Business Classification:
Specialty Retail

Year Founded: 1975

Build a Database

CAROL: It helps if you have a location that has lots of walk-by traffic or drive-by traffic so people notice where you are, if there are other businesses around you. But after that point, you have to really reach out to people that you feel are your target audience.

Unidentified Woman #1: There are a lot of unique things here. It's fascinating. You could spend a lot of time, you could spend a whole day here.

Unidentified Woman #2: It's incredible. You know, you want to go to every little shelf and take something of everything home with you. It's really nice.

HATTIE: So you already have several items in your basket.

Woman #2: Yes. We're planning on going to the kitchen section next.

HATTIE: Do you have a credit card? Woman #2: Yes, luckily.

CAROL: The more you know about who your target market is, the better. If you're marketing to teen-age kids who listen to the radio, then you need to be on the radio. If you are selling furniture to an upscale market, you might want to be in a slick city magazine. You also would want to probably do some direct mail to that targeted market.

For instance, we once rented a mailing list from Bon Appetit to reach people who are interested in gourmet cooking. The way it works when you rent a mailing list is you're given permission to use it once for a specific use, and that's why it's called renting rather than buying. You can also sometimes work out an arrangement with a non-profit group where they might let you use their mailing list in exchange for a donation to that group.

HATTIE: (Voiceover) Orange writes in her book, `A mailing list of your customers is essential and can be one of your store's most-valuable assets if you use it often.'

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