Lemonade Stand Marketing – The 5Ps
How do the 5Ps of marketing apply to something as simple as a lemonade stand? What lessons are learned that you can apply to grow a large and profitable business? As I mentioned in my previous post "Lemonade Stand Marketing – Location, Location, Location!", my kids put up a lemonade stand last weekend during the Colorado Dragon Boat Festival and here are the lessons learned that I think can be applied to your business too!
In our case defining the product was simple. It was lemonade. But you know, there are different kinds of lemonade. Did the kids need to differentiate their product? Nope. Let's think back to who the best customer was. It was someone walking away from a hot, sweaty, over-crowded festival full of overpriced, under-portioned food. What were the key elements the target customer was interested in? That's right, it had to be cold and refreshing. Do you think they cared what color it was? Do you think they cared about the brand? Do you think they cared whether it was sugar-free? Not at all. Cold and refreshing were the desired characteristics.
After attending a crowded festival where a bottle of water sold for $2 and a snow cone for $4, how much do you think the lemonade stand customer was willing to spend? The girls set the price at $0.50 for an 8 oz. cup. This was seen as a bargain by the customers. It was a great value compared to what they were used to. Such a value that they often gave more in tip than they paid for the product itself. And they did so happily! What can you do in your business to inspire your customer to pay you more than you ask?
We already talked about this in the previous article. A simple lemonade stand across from a crowded festival brought in the traffic needed to reap solid financial rewards. OK, so it was a not-so-simple lemonade stand since the mom, that's me, is an entrepreneur with lots of supplies. So they did have a nice white pop-up tent to help provide shade. Okay, now the designer in me is taking over…It was used to not only provide shade but to create a focal point and define the space, thus drawing extra attention to the stand.
The kids really took off with this and had a blast. They made a sign on hot pink fluorescent paper. Then the girls found themselves some sidewalk chalk and made arrows and signs all over the sidewalk. The menu was prominently displayed on the sidewalk. Then they got a paper and pencil and made a menu. They approached everyone on the street (it was hard to get past them) and took their order. Another technique used to grab attention was the spider man microphone. You know, the kind of toy microphone that simply magnifies your voice using no batteries. Shouting "Ice Cold Lemonade!" into the microphone was the most successful sales technique of the day to drive sales. Fortunately, no dress-up costumes were required to grab the attention of passerbys.
I'm adding the upsell information in here with promotion, but it also entails the other Ps inlcuding product and price. You see, the girls didn't just sell lemonade, they had add-ons, loss-leaders and upsells. Yes, and they didn't even know it! They started with lemonade for $0.50 and then offered cookies/brownies for $0.25. Now how many people do you know these days that walk around with change in their pocket smaller than $1? Not many! So if you are whipping out a $1 bill to buy a $0.50 glass of lemonade, and there are $0.25 cookies next to them, are you going to want that extra $0.50 back or are you going to buy a cookies too? And do you really want the quarter in change or are you going to leave it as a tip? Now, they got really tricky here by offering free water to dogs. it was a kind gesture, because, you know, it was a really hot day. Well, it just so happened that one of the daddies jokingly suggested that they sell dog buscuits for a quarter too, and well, out came the dog buscuits! Now we had our official loss-leader, free dog water, with the dog buscuit upsell. Whalla! Who kinew selling lemonade was such a sophisticated endeavour?
Who do you think was more successful selling lemonade: seven little girls all bouncy and smiley or a sedentary mom and dad? When the kids took a break, so did sales. Just goes to show that sometimes your team members are the key to your success. If all else fail in your business, I suggest exploiting the cuteness factor of a little girl's smile. Now, for those of us who hate planning, do you think taking a step back and applying the 5Ps of marketing might give you some insight on how to improve your business? Next up: Lessons from the Lemonade Stand: Life Skills.