Gaining Referrals Almost Effortlessly

In one sentence, one thought, and in less than one minute, I can show you how to double your customers right now, for free.

Got your attention? Here’s how – ask each customer you have for one customer referral. Just one. Not their neighborhood, not their family tree, just one preferably financially solvent customer.

Could this really be hard? Okay – you’re thinking – “I’d be lucky if one out of 5 actually did it!” Well, hardy, har-har ‘cause you just added 20% more customers on your “low” estimate. And if “just” one out of five of those did the same thing? You’ve just tacked on 24% more customers. Done with little or no cost, low effort and big returns. Just the way mega-successful businesses do it.

The simplicity of the above, and the undeniability therein, causes most contractors to completely, absolutely, and shamelessly ignore the huge numbers in gaining and encouraging referrals.

This oversight opens the door for you – the now enlightened contractor – to a path of customer acquisition unfettered by mountains of media money, “proving yourself” to skeptical first-timers, or being plagued with having to be the “low ball” bid.

Why? Because referrals are like “one of the family.” It’s “Joe says you’re okay and I know Joe, so come on over.” That’s a darn sight better than, “I saw your number in the Yellow Pages and I’m getting 53 bids and if you’ll fax me your business license and personality profile I MIGHT consider having you come over and give me your BEST PRICE if I decide you are worth anything at all.”

You see, referrals come with none of that baggage.

It’s not only important to keep customers for the return business they bring themselves, but also for the additional customers they can draw to your company. There is no better way to gain customers than through your customers’ referrals.

Satisfied customers make up your strongest sales force. Product or service claims from them have instant credibility in the eyes of a prospect.

When choosing a service provider, consumers are six times more likely to rely on the recommendation of friends and family than on advertising.

What’s In It for the Customer?

You know why you want customers to give you referrals, but, you may be asking, what’s in it for them? Sales Training expert David Holt says that there are four main reasons your customers want to give you referrals:

1.       The hero factor. Your referral source has an opportunity to be a real hero to one or more friends or colleagues. If working with you truly has been a pleasure, he or she can “look good” by helping a friend or colleague learn about you. Remember – people prefer to find service providers through recommendations.

2.       It brings them better service. Your customers know that if they give you referrals it will give you added incentive to provide them with even better service. Even though you attempt to give all your customers the best service possible, isn’t it natural that you will run a little faster and jump a little higher for the customers who give you referrals?

3.       They like you and trust you. If people like you and trust you, they probably want to help you. This is the most powerful reason! If you’ve been serving them well, most customers get great pleasure from helping you become more successful. If you share your vision for success, they will enjoy seeing your success by helping you with referrals.

4.       They know that keeping you in business helps them! Help your customers see the benefits of your staying in business – so you can help them as their needs change and be there to cover their warranties and continued maintenance.

Your customer may also respond to incentives you offer, such as a $25 discount on their new system for each name offered. In fact, the “Get More than You Pay For” form in your Sales Power Pack offers a “referral partner” checkbox that gives the salesperson the discretion to offer added incentive during a sales call.

Just remember, even if you do offer incentives, don’t overlook the fact that what you’re really offering are great products with great service from a great company. That’s the true incentive for referrals.

Readers can receive the no-cost report, “Endless Referrals” and a complimentary subscription to the Sales&Marketing Insider by sending a polite request to freestuff@hudsonink.com. 

Tree Dude, Part 2

I had no idea that Part 1 would trigger such response. In fact, there wasn't going to be a Part 2 until my inbox filled with responses, questions, comments from curious readers.

Let me start with this, and if any reporters take this out of context, may sandspurs invade your undergarments. I do not hold any hostility nor consider the arborist trade much different than much of the service world. (And the respondents in that trade were positively, the exception to any characterization, as evidenced by reading SMI!)

My experiences are the "other side of the trucks" to help all trades see through another's eyes. The difference here: I'm on your side too.

I had a pretty humorous (and startlingly similar) story from reader Tom Fore of Roanoke, VA who shared an exact quote from his Tree Dude after excessive tardiness. See 'Theater of the Absurd' in this issue. You can insert "carpet cleaner", "sheetrocker", "roofer" and virtually any trade you want... that phrase is being openly acted out for frustrated homeowners across America. Honesty points go to Johnny who actually said it.

Interestingly, one of the most thoughtful responses came from one Patrick George of Heartwood Tree Service in NC. After reading his email, I wish he'd make a 450 mile house call. Patrick is definitely NOT 'Tree Dude' but a certified arborist, yet admitted...

"Tree dude fits about 85% of the guys in my industry." That is important for any tradesperson to know because a reasonably-held standard rockets you past nearly 90% of the crowd. Good observation, yet Patrick had a question that was echoed by several others:

"Why did you pick this guy?"

People felt I surely was "connected" enough to get good referrals, or that I could choose someone with an IQ higher than that of wilted lettuce. Yet here's the truth of why I picked him, plus a sales number you have NEVER seen before...

Think You Got Some Bugs in Your Customer Service?

For the most part, our other copywriter Jessica is easy-going. She’s very contemplative, enjoys verbal jousting, has a great sense of humor and a quick wit. The best of copywriter traits.

That said, she’s not exactly a pushover. Once a very thin line is crossed, her inner calm turns into an enraged lion with venomous snakes for hair. (Did I mention Jessica was female too?)

Fortunately – for national safety – this rarely happens. Yet in what is turning out to be the “Best Worst Customer Service Story of 2010” (no applause yet, we’re only half way through the year, and we’re renovating our kitchen, remember?), Jessica’s line was crossed.

Oh, and I think you’ll be more than a little entertained to hear what happened next, in her own words. Customer Service lessons in abundance.



How NOT to Do Customer Service

By Jessica “I ain’t taking this anymore” Knight

My sister, brother-in-law and I woke on a beautiful Saturday to go to the “big city” for shopping and massages. A few hours later, not only were our muscles gloriously melted from the spa treatment, but our arms were filled with clothes, and most importantly, fabulous new shoes.

Since shopping and massages are so tiring, it was obviously time to hit our favorite Italian restaurant. Side note: I cannot eat pasta. So going to an Italian restaurant may sound like the dumbest idea since the doggie Snuggie (it’s real – look it up), but this restaurant will substitute pasta for grilled vegetables. Plus, the food is always fantastic. Decision made.

We walked in and were quickly seated by the overly-perky hostess who proceeded to knock a full bottle of olive oil onto my shirt. As I watched my shirt soak up enough oil to blame BP, I looked up for her response. It was one word long: “Oh”.

No apology, no wet nap, no oil boom, nothing. Mentally, I registered her disregard. So, greasy but undaunted, I spent the next 10 minutes in the bathroom drying the oil so I wouldn’t ignite when they lit the table candles.

Soon enough, our food comes. Oh joy. After a few bites I grab for my water, and there bobbing in the ice cubes, is a bug. We’re not talking about a gnat…we’re talking about an actual roach doing the backstroke in my water. This ain’t good.

Given my recently dismissed oil issue and now this, I politely and calmly called for the manager.

Now contractors, put yourself in my new, fabulous, shoes for a moment. A customer has a setback, then another, and now he or she is asking for you. You can either shine and be their hero… or you can spiral this thing out of control.

When the manager arrives, I explain the situation about the bug and the uncapped oil spill. As a repeat customer, my only “intention” was to a) Alert him to the problem(s) and b) Get a new glass of water. His reaction?

If you’re expecting an apology and, “Let me get you another drink and some napkins,” or even comping the meal, prepare to be shocked. His real response was to shout, “You’re not getting your food for free!” He was inching toward the line. Snakes were indeed beginning to grow out of my newly coiffed hair.

I gathered enough resolve to re-explain the oil slick and roach, and that I only asked for a glass of water. Once I had, he escalated his own crumbling position with, “I think you have an attitude problem.”

Unleash the lion.

In as good an Al Pacino as a lady can do, I said, “You think I have an attitude problem? Nope. I’m about to demonstrate an attitude problem for you.”

That’s when I stood and walked to the six tables surrounding ours, to start six conversations that all began with:

“Do you see this roach in my drink? The manager (my attitude induced finger pointing) doesn’t think this is a problem. Do you?” Snarls and gaggery ensued.

Half the tables got up and left, including a party of 9. I sat down, my performance now over. We gathered our things and as I departed I mentioned to the properly horrified manager, who’s repulsive non customer service attitude had just cost him at least $1500, “Now that was an attitude problem.” And we left, never to darken his door again, all because of a glass of water.

Let’s be sane here. People – your people, my people, others – are going to make mistakes. But the response is what makes all the difference.

In this case, the manager could’ve replaced the water, shared my feelings, and offered to pay for whatever laundry bill to clean the shirt. I’d have been happy. If he’d also offered to comp my meal (all of $17) I’d have been overjoyed. A wise manager would’ve done so instantly.

Yet the greedy and uncaring manger lost 3 additional tables, wads of Saturday night revenue and lost customers forever. As Adams has written many times, unhappy customers will tell 12 others their story. And that was before Social Media and the internet. Ooops.

Now your reputation is a few clicks away from being broadcast. An exponential increase to the damage can result in moments.

So if you leave a customer’s house a wreck, or don’t show up with the right materials, or have a dreaded “call back”, your reputation is on the line based on your reaction.

The lesson? Don’t be afraid to over correct. Spending more to save a customer and stem the bad word of mouth can save you (and make you) tons of money in the long run. Investing in your current and repeat customers generally has a better ROI than trying to replace them.

Bon appetit!

Idea. Tools. Action. Results.

I know tons of idea people. I generally like them, but when they say they’re “going to” do something, I don’t hold my breath. Before long, they’re onto the next thing, having talked themselves out of the idea’s implementation with any of the 467 reasons their last idea never got implemented either. Their inability has nothing to do with the merits of the idea, or their skill.

I know several tool people. They love gadgets, hardware, software, tools... doesn’t matter. “Things” are fun to research, consume, read about. They have deep, specific knowledge of skill. Many have closets and book shelves filled with the next thing that’s gonna change their life. Except life often gets in the way of using the tool for that purpose. Their inability has nothing to do with the tool or their recognition of its value.

I know far fewer action people. Some act first and think later, but as long as no one gets killed or fortunes get evaporated, no real harm done. Sometimes they confuse action with results. Experience often (but not always) guides them to get better at choosing opportunities. Their ability often comes with little core talent of the “craft” required to succeed, yet a great talent in confidence, persuasion, and team building.

Then there are the rare “results” people. They love outcome, feedback, improvement, measurement from before and after. They’re un-fun to be around if results are weak, but when the results “matter” (choose your definition) their joy and elation is contagious. The best don’t mind a fair critique, but their determination often overrides or makes them relatively immune to criticism. Their wisdom is often copying others’ proven results using similar input; their failure is thinking all the good results are ‘theirs’.

If the first two groups don’t recognize their need for the last two groups, inactivity becomes a death sentence. If the last two groups don’t see the value in the first two, they turn into opinionated, reckless blowhards. (Often setting them up for a career in politics.)

My Pollyanna point: It takes all these traits – rarely ever found in one body – to generate a model by which successes, fortunes, and world changes are formed. Sometimes just hearing about results inspires the rest of us to action.

Are You Running The Business – Or Is It Running You?

My 16 year old daughter and her team just snagged a spot in the state track meet, and I, by proxy, am feeling pretty accomplished. My thinking is that those speedy genes came from somewhere and there’s at least a 50% chance that they came from me. Of course, just thinking about all of that running has me panting with exhaustion. So maybe the genes came from her mother’s side…

At any rate, running a contracting business gives you a great feeling of accomplishment and sometimes a great feeling of exhaustion! One of the biggest risks is that your attention is pulled in so many directions that you lose sight of the things needed for your survival. Like with a lot of things, the secret of success is no secret at all. To excel in business you will have to do the following three things (or your failure is relatively assured):

1.Technical proficiency: 78% of contractors come from trade or on-the-job training. Getting more training is needed to improve your technical proficiency AND to improve your ability to solve your customers’ problems. But your expertise here is useless in realizing your business goals without…
2.Effective Business Systems. This is about a little thing called money. Your financial and operations picture dictates how well or if you’re being paid well enough to stay afloat. Yet without sales, it doesn’t matter. Here’s why:
3.Marketing runs the machine, not the other way around. Your sales are directly related to your leads, which ARE your ads, and comprise much of your marketing efforts. If you have a problem with your sales, you must determine: is it a presentation problem, closing problem… or a problem with lead generation?
Good marketing brings in leads. But don’t let your understanding stop at that point. Marketing is not about getting more leads.

Wait a minute – did I hear myself correctly? Yes, I did. Effective marketing is not necessarily about getting more leads. It’s about getting the right leads. To know whether you’re getting the right leads, here are some other things you should consider:

•Cost per lead is paramount. Who cares if newspaper placement costs you $100 more if it brings you more leads per dollar? Don’t freak out about bigger postcards, first-class mail, or a bigger Yellow Pages ad. Review what the expense brings you. It’s an investment, remember?
•Fewer shoppers is very cool. When you do creative marketing, you are – by definition – making a creative offer that is typically not duplicatable. Thus, it’s unshoppable. Thus, you’ve just put yourself out of the “discounting” business to “get the job.” Please don’t make me write “thus” again, except for thus…
•Higher margins. Fewer shoppers and unique offering means you can ask and get more for your goods. Try 2%, or 5% more to start. My guess is that you won’t lose one single customer except for Mickey McCheap, and you’ve been trying to dump him for years. The rest is yours to keep. We write lead-generation ads that openly tout increased benefits without saying a word about how “cheap” the service is.
•Success through seasonal dips is what most contractors want. With great marketing, you can turn your leads off and on like a switch. HVAC, Electrical or Plumbing Agreements, system offerings during mild weather can generate repeatable income each year. Start with a tune-up or service ad first, never attempt to sell a Maintenance Agreement in broad-market media. That’s a loser. (Believe me, I know!)
•Better Ad rates, Better Top of Mind Awareness (TOMA), More “Me, too” customers all result from a steady stream of good marketing pieces. Everything from a newspaper presence, yard sign visibility, lead-generating Yellow Page ads, postcards that stand out, Newsletters people actually read – it all adds up to smart marketing, real profit and, ultimately, a successful contracting business.

In this way, you run the business instead of it running you. Isn’t that the goal?

Driving Me Crazy

Who could imagine that my ‘baby’ girl just turned 16? I remember when my wife told me ‘we’ were pregnant with this, our second child. I was driving the trusty Chrysler minivan (legally mandated for all young parents back then) on a heavy switchback road in western North Carolina called ‘tail of the dragon’ to give you an idea of the curviness.

In a car with sporting pretense, this is a dream road. A minivan on this road was like wearing a burlap bathing suit to the Queen’s coronation. Hardly appropriate. For several seconds after she told me, I was in stunned silence, mouth agape, almost plummeting into several ravines. A little personal aside:

We’d tried for 5 years to ‘finally’ get pregnant with our first child. Yet that little miracle was 10 months old in his car seat when she told me of the second. And this little girl has been regularly surprising ever since.

She’s an accomplished pianist, outstanding student, and has a smile that could melt cast iron. And like all dads of teenagers, I am stupider than a turtle on crack. (I’m waiting for that to change, hopefully before I’m too senile to appreciate it.)

Yet the real surprise of the day, is she is now a legal driver, piloting her very own (used) car. Wow. Another shocker was shopping for this car. Double wow.

Let’s just get this out into the open: Car dealers used to have a reputation slightly lower than most sewer rats or even plaintiff attorneys. Some of this was undeserved, but mostly it was because they were conniving, lecherous, money-grubbing deceitful organisms in snappy outfits.

In those days, you’d walk onto a car lot, looking for say, a nice used Caprice in the $12 grand range. An hour later, you’d drive out in a bent Cadillac Brougham with the Wayne Newton package and a payment book totaling $48,724. In your review mirror, a guy with a Televangelist hairdo and a white belt would be counting money that used to be yours.

Not any more.

Possibly due to being sued every 30 minutes for 20 years, car dealers wised up. Then CarFax came along, and the internet happened, and ‘reviews’ started. Then ebay, traderonline, cars.com, yahoocars and craigslist all illuminate the ‘global car lot’. (Hint: Same with your business today.) Prices, options, and reviews could be relentlessly shopped. Reputations got earned or lost far faster. (Ditto.)

My daughter narrowed her search to a particular year, color, and body style of Jeep. Mean old dad gave her a firm “do not exceed or bodily harm could ensue” price range. Luckily, this necessitated a diligent search. She’d come home from school and zero in on 3-4 cars daily that ‘fit’ most criteria, saving links for me to contact

Dutifully, I emailed each (24 in all) with the same message, same parameters. The responses and reactions varied wildly. (See Bonus article at end.) This gave me a cross-section of sales and marketing methods, with suggestions for you on each.

What the Smart Guys are Doing Right

1. Systemized Yet Personal – The top-tier guys use the information gathered online to ‘aim’ a personal email message, in sequence. The call was equally personalized, effectively scripted. Additional links in emails in case I “upsold” or “cross-sold” myself. Pure genius. They realize people aren’t making inquiries for fun.

Suggested: Have a sequence of 3 personalized AutoResponders, give options to contact, and that you’ve assigned a specialist to them. Use links back to your site, suggest upgrades or accessories. Give options to get your mailed newsletter (forces them to give address and another opportunity for relationship.) If people are inquiring, they’re serious.

2. Transparency and Disclosure – The top tier guys are making sure you’re hyper informed. Just ‘offering’ a CarFax and a Consumer Review whether people get it or not (often free) earns huge credibility points. People are nervous out there, for good reason.

Suggested: Inform prospects on your website – not just about how great you are – but about product comparisons, energy costs, reviews, testimonials. Your mailed newsletter will also contain product and service cross-selling. Today’s buyer wants to ‘know’ you, and that’s often done through multi-media, smart marketing.

3. “Cheaper” isn’t Better – Interesting. If I didn’t bring it up, the dealers I considered ‘best’ did not force ‘cheap price’ down my throat, yet the old school cheesy guys did regardless. To me, this cheapened them. The better guys talked of reputation, warranty, options to make this car what I wanted. The top guys told me they could add a sunroof, leather interior, navigation, and a host of ‘cost plus’ upgrades. The cheap guys only talked cheap.

Suggested: Don’t assume all your buyers are in bargain mode. Assume they want quality, then go from there. Good to have bundled pricing ‘tiers’ for all, naming them accordingly. Cross-selling and upselling other benefits typically has a far higher margin, thus a worthwhile part of every script, communication, newsletter, follow-up.

In all, I ended up buying from the guy who was probably 2nd most impressive dealer, but had the car. Credit to the most impressive guy: When I told him what I’d found, he said, “If I were shopping, I’d buy that one too.” Yes, I kept his contact info as well.

The least impressive dealers, probably the bottom 10, never called back, never emailed again. Four of the top dealers have sent me follow ups – automated thus zero cost – just as impressive as the first.

The difference between ‘top’ and ‘ordinary’ is huge in image, sales, and reputation. But doing the ‘right things’ versus ‘hardly anything’ isn’t much – a few well-worded emails, some excellent sales training and the shockingly rare ability to listen to prospects and help them spend their money.

The Power of Referrals

Andrew Leslie is a man they don’t make anymore. Hard-working, Cajun born, duty driven. If the deep caramel skin (that’s about as smooth) and the tell-tale accent reeling quick witted tales didn’t make you question his age, his overbooked work ethic would.

Though just days from an age 65 retirement, I’d suggest training if you tried to keep up with him. I’ve seen his own shadow almost give up in frustration.

He had a full time career with J.R. Smith, helping assemble a few million specialty plumbing products, then moved into receiving, spanning as he told me, “23 years, 5 months, 2 days and about 6 hours… or thereabouts.” Andrew is rarely without supporting evidence.

Yet his “other” full time job was being a father to son, Eric, who’s with the Federal Railroad and daughter Rachelle, vice president of a bank. Andrew also unhesitatingly calls his nieces Kerry and Kimberly – both business owners – his “daughters” since they raised them as well. His wife, Eva, was equally active, but Fibromyalgia and Arthritis had other plans, enlisting Andrew as supportive caretaker for the last 14 years.

And his other full time job was lawn maintenance. He probably did other things, but I am getting tired of listing them all. Yet atop all this…

He was also a master of generating referrals, as many as he wanted, when and where he wanted. At the price he said, and here’s how he did it.

He was our lawn maintenance guy. Did it by himself too. Pulled a neatly-crafted and packed trailer behind his trusty silver Dodge Ram truck. Weed eaters, blowers, and a Snapper Mower than was more an extension of his hands and feet than a separate machine. Many a Saturday, I’d see Andrew, turning a zero radius circle around one of too many pine trees, never dropping a shaving of bark nor the ash of his Kool, with the fluidity of an ice skater, (yet thankfully in khaki instead of spandex.) Where he willed, the Snapper went.

And if our yard wasn’t enough, he had the neighbors to the left. And the right. And two doors down, plus the next one, and a couple more he’d hit on his way home. Master of efficiency, he had to “disengage” from one customer who was well off the route. “I had to tell her the drive was too much for an old man” he said to me once, adding “She wasn’t all that darn nice either.” I laughed, but he wasn’t done. “I hope she doesn’t move to a yard that’s more convenient”.

You can tell by the ‘connection’ to customers that if Andrew got one job, he’d get all the other ones he wanted, where he wanted, at the price he said. Shopping was over. Why? Because Andrew’s referrals were so enthusiastic you’d half question if there was some pyramid scheme of sudden riches coming to the referring party.

He got jobs – at will – in our neighborhood of yard-crazy people (historic neighborhood in the deep south, need I say more?) that is regularly patrolled by the ‘big’ companies. Their postcards were tossed, their TV commercials rendered us blind, the radio ads made us deaf. All we knew when prodded was, “Andrew does our yard,” usually recited like unwavering, slobbering robots. And we were.

Until Andrew retired from us.

Finding his “replacement” will be in word only. Oh sure, the “new” guy may have a little more bounce in his step, some more “moderness” to the approach, and potentially more eagerness for additional clients. But he ain’t gonna be Andrew, and that’s a fact. The beauty of Andrew’s legacy, only briefly shared herein, has a marketing thread of fascination for me in that he scored 100% of the jobs he wanted, sans price-shopping.

He “Advertised” his work while doing his work. A neat truck, parked out front, with good well maintained equipment was better than an interstate of billboards. If you’re NOT doing this, plus yard signs, and/or parking pylons, and/or door hangers, and/or windshield signage, how are the neighbors to know you’re ‘endorsed’?

Focused marketing efforts. Andrew controlled his jobs instead of the other way around. Sure, he could’ve gotten jobs in multiple inconvenient locations, but he focused on a particular customer, in a particular area, and “owned” that area.

Pricing insensitivity. Andrew could price a job since he had to move his truck a few feet, spreading the ‘windshield time’ over the adjacent yards, where others had to quote from a ‘rate sheet’ that unwisely assumed a trip charge regardless of relative proximity. Smart.

Established a Referral chain. Each new job came with a blessing and endorsement from the previous. This was the ‘first step’ in a three step process that followed with…

Asked a simple question of the potential referrer: “If I introduce myself to your neighbors, is it okay if I tell them that I do your work?” Who’s gonna say ‘no’ to that? No one did. Thus the near simultaneous 3rd step…

Qualified Introduction: Andrew would introduce himself as being the lawn maintenance professional for and wondered, “I love this area and these great lawns. If you’re looking for someone to take care of it, I’d be honored. The said it’d be okay to call them to ask anything you’d like about my service.”

Generally a phone call would ensue, which began the blathering, which ended in “SOLD!”

Regular re-endorsement and relationship building – We got an invoice monthly, sometimes with a hand written note (bill stuffer anyone?) and a Christmas card every year. It’s the small stuff that can make the strongest glue.

If Andrew had been a “company” of more than one, I’d have recommended all these, but using media to broaden the message. The message remains the same…

Your referrals will not “just happen” in the numbers you could get if you “made them happen”. Andrew made his happen. You must target, ask, follow up, and perform as promised, then repeat. If you do this for 23 years, 5 months, 2 days and about 6 hours… or thereabouts, you can grow your referrals and retire happy too.

Happy retirement Andrew. Me and my overgrown yard already miss you.

Questions for You:

■ What “ACTIONS” do you take to ensure that one customer leads to many? I’d suggest a 7 step follow up procedure, beginning on the first day following a new customer contact, spread over the next 120 days, with 2-4 ‘programmed’ contacts until they moved, died, or told you to go away.

■ What “SYSTEM” is in place to make sure the actions don’t get “forgotten”? This is a biggee. Our “Endless Referrals” program is designed to be just that, putting a single person in charge of this (should take 20 minutes a month) to enact.