Solution: A company's database of customers is potentially its biggest asset. It's much more valuable than equipment, inventory, etc. This is not only true of companies that utilize mail order or Internet marketing. Every single company that wants to survive and prosper needs to build a database.

4. The company does not communicate often enough with its customers. The result is lower sales and profits than are otherwise possible.

Solution: Contact your customers a minimum of once a month. When I started my first business at age 21, I too made many mistake

Undercapitalization, inexperience, or poor management are usually blamed for all business disasters.

Of course, there can be one or several more causes that result in a business going "belly up."

However, from what I've seen, marketing mistakes are by far the primary reason businesses do not survive. This includes companies which consider themselves direct marketers as well as those who do not.

Here are the seven most common marketing mistakes:

1. Management treats marketing as a business expense or simply a department rather than a necessary business investment.

Solution: Marketing should be treated as the driving force of any company. It is the only function that brings in cash. The other major functions in a company are necessary. But they all spend cash. This includes the primary business departments of finance, production and research.

To market any product or service successfully, the company must do two things:

A. Provide marketing with sufficient resources

B. Put marketing at the heart of its business strategy

The whole company should be focused on the needs and wants of customers and be prepared to satisfy their demands.

Marketing must be part of the philosophy of all entrepreneurs and managers.

2. Management does not know specifically what it costs to recruit a new customer. Plus, there are no accurate statistics on the average customer lifetime value.

Without this knowledge, it is impossible to make sound decisions. You cannot determine how much to invest in marketing. If you spend more to gain a customer than their lifetime value, ultimately you will go broke. In the absence of this information, many businesses can and often do fail. To make matters worse, few of the casualties understand why they failed.

Solution: Before you invest large sums on marketing, determine the average lifetime value of a customer. An excellent book that I highly recommend on this topic is The Loyalty Factor by Frederick Reicheld.

3. Management makes no attempt to build a customer database. This is especially so with most retailers, restauranteurs and department store owners. However, I've seen this in many other businesses.

Solution: A company's database of customers is potentially its biggest asset. It's much more valuable than equipment, inventory, etc. This is not only true of companies that utilize mail order or Internet marketing. Every single company that wants to survive and prosper needs to build a database.

4. The company does not communicate often enough with its customers. The result is lower sales and profits than are otherwise possible.

Solution: Contact your customers a minimum of once a month. When I started my first business at age 21, I too made many mistakes

Solution: Marketing should be treated as the driving force of any company. It is the only function that brings in cash. The other major functions in a company are necessary. But they all spend cash. This includes the primary business departments of finance, production and research.

To market any product or service successfully, the company must do two things:

A. Provide marketing with sufficient resources

B. Put marketing at the heart of its business strategy

The whole company should be focused on the needs and wants of customers and be prepared to satisfy their demands.

Marketing must be part of the philosophy of all entrepreneurs and managers.

2. Management does not know specifically what it costs to recruit a new customer. Plus, there are no accurate statistics on the average customer lifetime value.

Without this knowledge, it is impossible to make sound decisions. You cannot determine how much to invest in marketing. If you spend more to gain a customer than their lifetime value, ultimately you will go broke. In the absence of this information, many businesses can and often do fail. To make matters worse, few of the casualties understand why they failed.

Solution: Before you invest large sums on marketing, determine the average lifetime value of a customer. An excellent book that I highly recommend on this topic is The Loyalty Factor by Frederick Reicheld.

3. Management makes no attempt to build a customer database. This is especially so with most retailers, restauranteurs and department store owners. However, I've seen this in many other businesses.

Solution: A company's database of customers is potentially its biggest asset. It's much more valuable than equipment, inventory, etc. This is not only true of companies that utilize mail order or Internet marketing. Every single company that wants to survive and prosper needs to build a database.

4. The company does not communicate often enough with its customers. The result is lower sales and profits than are otherwise possible.

Solution: Contact your customers a minimum of once a month. When I started my first business at age 21, I too made many mistake

The whole company should be focused on the needs and wants of customers and be prepared to satisfy their demands.

Marketing must be part of the philosophy of all entrepreneurs and managers.

2. Management does not know specifically what it costs to recruit a new customer. Plus, there are no accurate statistics on the average customer lifetime value.

Without this knowledge, it is impossible to make sound decisions. You cannot determine how much to invest in marketing. If you spend more to gain a customer than their lifetime value, ultimately you will go broke. In the absence of this information, many businesses can and often do fail. To make matters worse, few of the casualties understand why they failed.

Solution: Before you invest large sums on marketing, determine the average lifetime value of a customer. An excellent book that I highly recommend on this topic is The Loyalty Factor by Frederick Reicheld.

3. Management makes no attempt to build a customer database. This is especially so with most retailers, restauranteurs and department store owners. However, I've seen this in many other businesses.

Solution: A company's database of customers is potentially its biggest asset. It's much more valuable than equipment, inventory, etc. This is not only true of companies that utilize mail order or Internet marketing. Every single company that wants to survive and prosper needs to build a database.

4. The company does not communicate often enough with its customers. The result is lower sales and profits than are otherwise possible.

Solution: Contact your customers a minimum of once a month. When I started my first business at age 21, I too made many mistake

Solution: Before you invest large sums on marketing, determine the average lifetime value of a customer. An excellent book that I highly recommend on this topic is The Loyalty Factor by Frederick Reicheld.

3. Management makes no attempt to build a customer database. This is especially so with most retailers, restauranteurs and department store owners. However, I've seen this in many other businesses.

Solution: A company's database of customers is potentially its biggest asset. It's much more valuable than equipment, inventory, etc. This is not only true of companies that utilize mail order or Internet marketing. Every single company that wants to survive and prosper needs to build a database.

4. The company does not communicate often enough with its customers. The result is lower sales and profits than are otherwise possible.

Solution: Contact your customers a minimum of once a month. When I started my first business at age 21, I too made many mistake

Solution: A company's database of customers is potentially its biggest asset. It's much more valuable than equipment, inventory, etc. This is not only true of companies that utilize mail order or Internet marketing. Every single company that wants to survive and prosper needs to build a database.

4. The company does not communicate often enough with its customers. The result is lower sales and profits than are otherwise possible.

Solution: Contact your customers a minimum of once a month. When I started my first business at age 21, I too made many mistakes. The business somehow survived and became a chain of retail confectionery stores called Peterson's House of Fudge. At first I sent my customers an offer every six months. So I tried sending a sales letter every three months. My business doubled. I then began mailing every other month. My business again increased proportionately.

I wound up with the ideal and most profitable interval-- once a month.

At first I thought contacting customers every 30 days might be too often and that customers would get turned off.

But that didn't happen. I got great feedback as well as higher sales. Providing your customers like, or even love, your product or service, as they should, they want to hear from you frequently.

This, of course, is in the context of your sending excellent offers, excellent copy and excellent information.

Indeed, if you are not in frequent contact, your customers will quickly begin to forget about you. Many will start buying from your competitors.

I urge you to contact your customers at least every 30 days (occasionally with special offers a week apart is perfectly fine too).

Your form of contact can be an e-mail, postcard, catalog, telephone call or personal visit. I've found the most effective method of regular contact is with a well-written sales letter.

Rarely do I find a company of any kind which systematically mines the real gold in any business--the customer database. Make sure you do not make this mistake.

Making offers to your customer database is often referred to as the "back end" in direct marketing jargon. But every business should cash in on the huge potential of existing customers by simply making frequent offers to them and giving them more opportunities to do business with you.

5. Management has no method of accurately measuring the results from its advertising investments. This is especially so with so-called image advertising.

Solution: The way this is done is to seek a direct response in each promotion. This can be a coupon, telephone call or store visit. Code each promotion. Then when an order is received or a customer visits your establishment, you can appropriately trace it to the particular promotion.

The coding system can be numbers or letters. If you use the telephone you can utilize separ