TRUE STORY: How to Not Win Customers

Next year we’re celebrating our 30th wedding anniversary. That is, if she’ll start behaving soon. (Camera cuts to me pleading, “No dear, I didn’t make any snide remarks in a public forum. May I peel you more sunflower seeds?”)

Since we’re going like way out of town, I headed to the post office to update my passport. Funny, my kids have been to Europe twice since my passport expired. Something is seriously wrong here.

And something is equally wrong with the United States Post Office. Yes, I realize they spent all their lunch money when Reagan was prez, but if you’ll look at this stupid sign at the entrance, you’ll see this is one of dozens of things very rotten about their message. And this same thing applies to you in your business. Check out the dumbest greeting sign ever…

The parking lot, by the way, holds 80 cars, and I never see more than 5-6 there. And are the words, ‘…or less’ really needed here?

Imagine this idiotic sign in front of any place that might want customers. Or might want them to linger. Can you imagine Starbucks doing this? There’d be bedlam in the social media streets. Baristas would leap from drive through windows.

So, they have serious sales problems, and are doing their best to curtail their nonexistent customers to 30 minutes. Got it.

I pick on this sign, not for the lunacy it is, but as an indicator of systemic failure. Yes, the problems persisted indoors.

The place looks shabby. Soaked ceiling tiles, half drooping. Hand scrawled signs haphazardly taped to walls with friendly notes like, “Don’t let your children play on the rails,” and “Stand behind yellow line until next teller motions.” (Motions? Motions for what… a pardon?)

This Conversation Actually Happened

ME: (After being properly motioned), “I’m renewing my passport and…
ZOMBIE LIKE PERSON in grayish blue, to match her blood: “He’s not here. He’ll be back at 1:00”.
ME: “Uh, he? (I’m struggling already.) “He, the Passport specialist?”
ZLP: “Yeah. He takes the pichers. He’ll be back at 1.”
ME: “It’s 5 after 12. Can I get the forms to fill out and come back?”
ZLP: “You can do that and take it to CVS or Walgreens. They’ll do the photo. You pay them the $35 fee.”
ME: (Thinking) Did she just send me to the competition?
ZLP: “Here’s an envelope. I think they’ll sell you the postage too.” Yells in back. “Hey Mike! Won’t they sell him the postage after they take the picher?”
Mike, avoiding the menace of photography during lunch: “Yeah, they can do all that.”
ME: (Dumbfounded that photo-boy was there the whole time. I’m sent away without a passport, photo, or postage from the very place you’d expect THAT at a minimum.)

I leave stunned, with a touch of zombie-itis setting in as I pass the stupid sign on the way out.

At the CVS, there was no customer repellant signage. No “he” eating an egg sandwich, unable to help. A very helpful 4 minutes later, my photo is taken, the form reviewed, postage affixed, and process begun. I bet every CVS trainee in America can click the camera button, especially for the $35 Passport fee, plus the $110 for the processing, including $8.90 for the postage. How much did CVS keep?

Then she kindly asks for an upsell: “Do you want to look at some travel-size toiletries while you’re here?” That type behavior will probably get you kicked off the Customer Repellant team at the Post Office.

A Question that leads to Wealth:
Are you adding or reducing friction with your customers?

With every customer contact, you’re doing one or the other. The Post Office was solid friction. CVS was like ball-bearings with Z-max poured on them.

• Is your CSR trained to advance the call? Or to put people on hold? My friends at CallSource tell me that the average appointment set rate for contractors is a painful 64%. That’s like 36% of the people being sent to the competition, eager to buy.

• Are your techs versed to advance the sale or relationship? How many mention the Maintenance Agreement and the discount they could’ve gotten? Do they ask for a positive online review? How many mention your other services?

(Two different consulting clients told me this month that their ‘other’ services fall behind when one is super busy. My question: “HOW CAN THIS BE when they are in MORE HOUSES?” Blank stares and silence ensues.)

• Does your follow-up contact ask about satisfaction? Referrals? Other services they wish you offered? Gather the email address? Bump to an Agreement?

• Does your outbound marketing only tout ‘sales’? (Fastest way to lose credibility.)  Only 55% of your marketing balance should be Direct Response, and I’m aggressive. The other should be Image, TOMA, and Retention. (Call your coach.)

• …Or vague generalities, with nothing unique?  “We’re fast, reliable, and honest!” Oh really? My clients are slow, unpredictable, and steal constantly.

While pondering the New Year, make some new changes to reduce friction everywhere you can. You’ll find far more business will slide your way, along with referrals, reputation, and more reasons your customers will grow blind and deaf to the competition.

They’ll be the ones eating the egg sandwich, wondering where all the customers went.

- See more at: Sales&MarketingInsider.com

Marketing Changes to Embrace

Recently I did a 2 part editorial on "How the New Economy Has Changed Everything". Got more responses than in many years, perhaps ever. (Request a copy at the end if you like.)

Basically, we're part of a very changing economic/business landscape. History will detail the following, but I don't believe it's ever "going back" to how it used to be.

Reasons within three big changes:

1) The seismic shift in information exchange (internet, consumer as 'voice', social viralism)

2) Declining/stagnant real estate values (often south of the mortgage owed, making foreclosure a strategy instead of involuntary hardship) and

3) Consumerism conflict: how we "value" vendors and "justify" purchases. The rules have dramatically shifted.

Evidence supporting #1 above: news media now sees their role to gain audience in the "24/7/365 News Orgy" as out-sensationalizing everyone else.

This means "News" headlines today shift more often than Charlie Sheen during a mudslide. In the news last WEEK were, "Economic Confidence Boosts Retail Outlook" followed by "Consumers Holding Back Citing 'No Confidence".

You wonder if they are TRYING to turn us into paranoid schizophrenics, or if that's just a bonus.

The shifts in communication and commerce have caused reactions in marketing and selling. Big ones.

Once "sensational" marketing has been diluted, lost. You can't out-scream everyone. "High-pressure selling" is the business equivalent to having a sexually-transmitted disease. And "waiting for the phone to ring" is the Old-School admission that you're somewhere between geriatric and irrelevant.

Back to my original treatise: The 'old' ain't coming back. Leaving you with one question -

Will you LEAD amid these changes, or WATCH as the leaders use the changes to win?

The Coming Marketing Meltdown

And there he went. Just like that, my son was in my rearview mirror, standing by the curb next to his 'new' dorm, as we drove back home from planting him at college. Things were quiet in the car. If you listened closely though, you could hear the faint flipping of mental images working backwards.

• The prom pictures where I was taken aback that he looked so much like a man.
• The early driving days when he looked like a child who'd stolen his parents' car.
• The baseball years where the glove was so big his fingers didn't reach past the palm, and the helmet could actually be spun while still on his head.
• The diaper years (which we really need to figure out how to eliminate, no pun intended), the cuteness of baby cheeks, missing teeth, and little fat baby joints that could go in almost any direction.

Then I snap back into the present: a young man at college. A father questions much. This is a quick poem, which doesn't have a blooming thing to do with marketing, but if you're a parent, it may hold a grain of value. Click for 'A Father Questions'.

As a business owner, worker, parent, we all want to have made our presence known somehow. Two things we all wonder:

Are we doing enough to make a difference?

Are we leaving the place better than we found it?

If 'yes' to both, congratulations, for you have done your job well. Yet there's a guilt epidemic floating amongst the "going to's" that never quite get done. We're "going to" start saving more, earning more, vacationing more, stressing out less ... one day. And just like depositing a child at college, that day comes, inevitably and you wonder if you did enough.

In a marketing perspective, there is a meltdown happening now that will separate winners from losers. The prepared vs. the "how did this happen?" The outcome is greatly affected by the convergence of: a) Economic recession, b) Major lead shift from Yellow Pages to online, c) Mass "Distractionism". Your Marketing Meltdown Warning here.

7 Steps to Lead Generation Riches

I don't know who said "The main thing is to keep the main thing the main thing" but it has never been more true. Every week contractors call or question, "How can I get more leads?"

Yet, in that decidedly ruthless way that shocks the inquisitor, we are trained to respond: "What are you doing with the ones you have now?"

By that we mean that there are 7 'main things' to extract full, cash-rich value from your current lead flow. It's right there under your nose...

1. Where'd they come from? (Market source via media.)
2. How big is this target source? (What we call "universe".)
3. How many bought what? (Closing ratio per item.)
4. What did they pay? Upsell offered? (Transaction size per ratio.)
5. Do they have friends? (Referral follow up chain.)
6. What about the ones you didn't close? (Follow up closing efforts)
7. What system will keep all these customers and prospects coming back to you?

Because to us, we can make the phone ring again. But if you're not maximizing the lead value, then it's only marketing heroin. More is not always better.

Those questions are in order, too. The top one is the most important. A mediocre ad to the best target will outperform the best ad to a mediocre target. Yes, as an overpaid copywriter, I just said that. Truth is, we can usually kick your mediocre offer AND help you find the best list because that serves both of us.

Then "target" in to wherever your offer is aimed. From your customer list to your web visibility, which includes SEO, AdWords, and even your radio demographic, Cable reach, and in house prospect list. These are 'segments' you can define that have a reachable quantity.
That leads to #2.

Is this your current list, dated list, big ticket buyers, referrals, church bulletin, little league parents, or chamber of commerce? I mean, you've got to know the size of the pool. To answer whether it's even worth fishing the pool, check out #3...

Do they close well? Or are they a bunch of mealy mouth price shoppers? Maybe they're rabid for image and product 'z' supports that image. Closing ratio must intersect with ticket and gross profit to be meaningful. Then to #4...

Are they high transaction sales that can make your month? Or low transaction that must sustain volume to be profitable? On either, is there a more profitable upsell you're not offering? Before you leave them...

The Great Email Backlash

I hate it. We all hate it.

Email has turned into the digital telemarketer during dinner. It's too much, too often, and - in my lowly estimation - too cheap. I wish they'd charge for it so the spammers, slammers, and scammers could just go bother someone else.

In the meantime, you and I nearly dread the return from a vacation, finding inboxes crammed with promised millions, Viagra offers, male "enhancements" and some scandalous promise from the marketing world. (Yes, probably even me on occasion.)

So, the legitimate emailers of the world are sort of trapped by association. This very e-newslettter goes through massive filtration to keep out of the trash (though we lose a few every issue) and has gotten 'dressed up' mightily over the years to maintain a credible presence. We've taken steps to greatly increase readership, some get by the "wrong" filters though.

Clearly Unclear

Old cars are like young children. Highly dependent, often naggy, hard to predict. Okay in that light, they're like older children too. Yet one of my strange old vehicles needed a windshield because it failed to avoid a 70 mph rock. Silly car. Since it was already having some other mechanical needs tended, I figured I'd get it all done at once.

So, I did what any modern consumer does, I opened the Yellow Pages. HA! Good one. I went to Google, clicked the top couple of names, and actually found one that listed my glass and at a reasonable price. "Wow, I thought. This is so easy." Any time you make a statement like that to yourself, you have doomed the outcome to sheer bedlam. There will be weeping and gnashing of teeth.

Proceeding ignorantly - my favorite way - I place the order online. It totals my order, and even politely mentions, "This price includes the windshield, gasket, and all labor. If we find you don't need a new gasket, this amount will be deducted." Soooo easy, said the Titanic's most oblivious passenger.

Afterward, it asks me to pick a "convenient" time. I scan for the option that says, "Never" but then notice THEY can go to the CAR while it's in the mechanical repair shop. "Now that IS convenient!" I say to myself, like getting a ride to a Vampire's blood drive, with much the same outcome.

So, I have the part, the installation price, the date, the place... it's all set! Whoohoo. The internet makes things SO EASY.

Soon after the "confirmation" email (translation: "a wild guess with legal language attached") things went weird. Their CSR (translation: Customer Service Repellant) called. From there, all online promises were off, chuckled at in their dismissal. Just goes to show two things: a) Your marketing and your service had better be consistent, and b) The internet's 'ease' of commerce is commensurate relative to the 'ease' of any customer's communication with the world. Case in point...

Midterm Mindlessness

With midterm elections just around the corner, the political rhetoric has been ratcheted up a few billion notches. And in case you missed it, the focus seems to be on our still-lagging economy. If I hear one more political ad promising the complete and total turnaround of the U.S. economy within 24 hours of electing Joe Schmoe, I may just have to start a campaign of my own. Why?

I’m as sick of the economic non-news as you are. (Part of the reason its called “NEWS” is something in it should “NEW”.) I’ll go so far as to say the following, which could cause a flurry of hate-mail being sent my way.

There’s no point in crying about the newest Economic non-news, especially if…


1. We start looking at what’s more important in life than money. How can it be bad to return focus on family, simplicity, and doing without meaningless clutter? Gosh, we might read a book instead of forking over $50 to go to the movies. Which one could “enrich” you in two ways?

2. We remember that if we weren’t selling our stocks or homes when they were “up”, why in the world would we become anxious in contemplation of doing so when they’re down?

3. We recognize that the “value” of our gains was merely “potential” value, only becoming realistic if sold. Big difference between “potentially” and “realistically”. Potentially your service van can compete in the Indy 500. Realistically, you’d be better off on foot.

4. Embrace the “C” word. I’ve yet to see homeowners go without heat, or plumbing, or electricity. Be very thankful you’re in your field of work, and that commodity is not a four-letter word. And more importantly…

5. Just be thankful, period. You’ve got health, or the hope of improvement, plus family, friends, and faith in better days ahead. Even what Americans call “poverty” materially dwarfs 70% of the rest of the world. We need to show less attitude, more gratitude.

6. All this stuff is God’s anyway. We’re just renting it. (Some of us a little behind on the payments perhaps.) Regardless of your faith or belief, there’s a pretty decent chance you believe someone other than man made the earth, its resources, its glory. Further, I’ll imagine you’ve yet to figure out a way to take it with you when you’re gone. Want what you have.

If THIS is what the economic turmoil brings us, bring it on. It’s here anyway; neither you nor I caused it; we can only control how we respond.

A choice, as I see it. Now go share some good news. There’s plenty enough to go around.

Thoughts and considerations –

1. Do you have ONE PERSON you’d like to thank? I bet more than one. Why not ‘pay out’ with some thanks to somebody who could use it? Pretty darn easy to. Click here to get started.

2. Do you have a whole BUNCH of people you’d like to thank at one time? Like, um, maybe YOUR CUSTOMERS? We have contractor Holiday Cards available again this year.

3. Would you like to triple your market penetration for pennies? Check out the radius marketing program through Express Copy.

The Real Wealth in Contracting

Hallelujah. We now have a kitchen. Or most of one. At least I have a sink where I can wash my coffee cup without first having to remove some ladies' undergarment apparatus from Woolite. (Once it took me nearly two hours to untangle a halter top that had some origami kind of twisted front. I still don’t know if I got it right.)

We can now cook food in something other than a microwave. Since my teenagers eat roughly 11 meals per day, our home – when viewed from Google Earth – looks like a glow stick.

My refrigerator is no longer stylishly perched in the entrance hall, seemingly saying to guests, “Hi, welcome to our home. Please have some butter.”

And tracing my 12 weeks of family torment back to where it all began, we are once and for all…

Formica-less.

I hadn’t realized the kitchen design embarrassment my wife had endured all these years. The indestructible Formica had served us well, though it was potentially more suited to the Space Shuttle belly pan.

We now have quartz and marble countertops. Yet with manufacturing cleverness, they could be reconstituted Formica made to look like other materials, only priced 400 times higher. In fact many “hardwood floors” are really Formica with different names, same as many politicians.

Though my first home cost less than this renovation (I have no idea if that’s true, but you must make this type comment so others will do the “renovation gasp”) my wife is happy. And that counts for everything (unless you’re attracted to misery, punishment, weeping, gnashing of teeth, and sleeping in the yard).

You should be excellent at a) getting and creating “happy” customers, and b) committed to keeping those customers. Sure, you can have a “satisfied” customer and “hope” they call you back, but that’s so yesterday, so basic, so not you.

Though your job skills are important, no skill is more important than getting and keeping the customer. Why?

What value are your skills without customers? In this economy, not much. A fantastic plumber with no work is heading toward being broke. An “okay” plumber good at keeping customers and with a constant 2 week backlog is heading towards wealth.

You’ve got to be more than “just” skilled. Things have changed.

Here’s How The Contractors Fared, And Who Is Most Likely
To Take Their Business To The Next Level…

• The GC – Stayed in touch after he did a smallish bathroom job for our daughter’s room. He stayed busy while others moaned, and remembered to keep the pipeline full by treating ‘past’ jobs as ‘current’ customers. Smart. He scored this job and has a nice backlog of work. 2009 was his best year ever. Grade A

• The Plumber – Did fine work. However, he never said his name, never left a card, never asked to look at other plumbing issues in the house. We had to be reminded he was the plumber on the previous bathroom job. Guess he doesn’t care that we have plumbing in rooms other than the kitchen, or neighbors, all in 100 year old houses. He just does his work, disappears, hopes. Hard to call or refer a phantom. Grade D-

• Electrician – Did fine work. Uniforms, truck signage, left a card on every visit, we get his newsletter, postcards. Also called behind the work to check. Subsequently (and I’m no big customer) this company has done Hudson Ink’s 3 commercial properties, a warehouse, another house, and neighbors on both sides. Grade A

• Floor Dudes – Did ‘fair’ work. Has the people skills of a bruised turnip. Swept sawdust into our new floor vents, like we didn’t notice. Lucky they didn’t come on while the floor was wet. Fast, rushed, left zero company info, never called back to check or make good on the misstep. Our house and offices all have hardwood, as do all our neighbors. Oh well. Guess they don’t need more customers. Grade D

• Painters – Neatest painters I’ve ever seen. Cleaned up daily. Left swatches, mixed custom batches, really exceptional. To their discredit, never checked to see that we have other walls, or that I was planning to repaint our office façade, like I do every year. Even the company that did that job last year disappeared too. Never called, emailed, recontacted, nothing. I have no idea who it was. Guess I’ll just Google for painters. Grade C

• Countertop/Cabinet Contractors – Fabulous work. My wife’s birthday was during this time, asked if the marble could at least be ‘set’ while she was away as a surprise. They willingly complied, did an excellent job going “one step beyond”. I won’t forget that, nor them. They left company info and called after both jobs, Recontact works folks. Grade A

You may notice that the grades have little correlation to the quality of work. They have everything to do with getting called, referred, or remembered by a good “retained” customer. Recontacting customers means you’re keeping them by keeping yourself relevant.

A message from your customers to you: We’re paying customers. You paid to earn us. We want to remember you, call you, refer you, buy more from you, but need your help. Please don’t ignore us.

Once you’ve gotten a customer, your most important job is to keep that customer.

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.

Victors, Victims, and Volunteers

SAFETY TIP: Do not try to remove a 10-pound fire extinguisher from its bracket with your head. You really should just use your hands.

I was minding my own business, really. I’d leaned down in my garage to see if I – a mere mortal with a flawed sense of mechanical aptitude – could remove the front bumper cover off my needy car to get to the horns.

See, it had wimpy horns. And in the intelligence of the Dodge Viper assembly team who likely considers honking inferior to just lighting up the tires to escape harms’ way, they’d stuck the horns in a thoroughly unreachable area. I knelt all the way down to see the dinky little horns beside the radiator. Then I stand up abruptly.

Major ouch. At my height, I don’t bump my head very much, so I made up for several lost opportunities.

Two very loud ‘clonks’ rang through the building – the first being my head removing said fire extinguisher from the bracket, the second being the extinguisher hitting the floor, scattering tools about the cement floor.

I got to my feet and poured a bottle of water on my aching head, clearly needing stitches. I contemplated going to the emergency room, but images of waiting behind gunshot victims and those with various communicable diseases coughing in my general direction made me to reconsider. (Avoidance of additional pain, a sales lesson worth noting.)

So, with icepack on head, I watched Americans in Idle with my sweet wife and marginally concerned teenagers. The next day I went to the doctor who did his embroidery and sent me on my way. Got me to thinking.

Stuff happens. Quickly and without notice. There are ‘accidents’ so named because there’s no one to blame for their occurrence. I guess I could’ve gone ‘victim’ and sued the contractor who installed the fire extinguisher, the fire extinguisher company for not ‘softening’ the edges of said unit. Plaintiffs and the tapeworms posing as their attorneys have gotten paid for more preposterous things, I assure you.

In this economy, we’re hearing more about “victims” of its wrath. For the guy or lady who lost their jobs due to plummeting sales (which govern the economic machine, lest you forget) out of their control, “victim” could be apropos.

Or for those whose livelihoods have taken an epic-sized belt tightening due to skittish customers or the collectively paranoid lenders that used to keep the pipelines flowing, the “victim” word accepted. Yet for many hoping for a Victim card, might I suggest a different word…

Such as “Volunteer”. You make the call:

Case Study: A contractor who had been doing well in the go-go economy, was seeing his agreement renewal rate slip, his closing ratios tilt downward, and his margins erode to get the jobs. “This is the economy” he told us.

We suggested circling the wagons and protecting his customer base first, locking down renewals, beginning a low-cost referral campaign, then getting aggressive with Direct Response acquisition strategies for better-heeled, less price sensitive new customers.

In essence, he responded “Nonsense”, and promptly spent $60,000 on a radio campaign that was more about his ego and price-cutting than existing customers. Failure ensued.

During the past 12 months, he’d actually reduced his Customer Retention campaign to fund the “new” marketing. In time, his “old” customers heard the “new” offer, saw it as superior which generated two responses: a) Cut me the same deal or I’m gone and/or b) If that’s how you treat loyalty, I’m gone. Thus, his respondents became a mix of current customers seeking a concession and cheapskates.

Immediate margin erosion and accelerated customer exodus sent our contractor into a tailspin. Most profitable leads dried up. Ninety days later and half a staff later, he still has $15grand a month due in radio, his YP budget was never trimmed (suggested for 3 years, “couldn’t give up the priority placement” said his ego), many current customers and their agreements defected due to inequity and inattention. Some defectors commented on a blog site and reflected same in Google Rankings. Not good.

He admitted that he’s very likely a couple pay cycles from the “B” word if things don’t improve. Called his company a “victim” of the economy. Your assessment?

Send responses to editor@hudsonink.com. Hottest strategies for ‘Joining the Victors” next issue.

There are victors, victims, and volunteers. This economy is making their distinctions very clear. Joining the victors is mostly a choice to do so.

NOTE: A discussion of “Victor” strategies in lead generation will be covered in a one time webinar hosted by the NEWS on April 14. Called, “Phones Not Ringing? Top 7 Ways to Generate More Leads”. Very limited seating remains. More here: https://event.on24.com/eventRegistration/EventLobbyServlet?target=registration.jsp&eventid=198591&sessionid=1&key=5239ED983DFE7328DF1AA7EC49A026DB&partnerref=hudson&sourcepage=register

Crack for Clunkers

Maybe I missed something. Just read that the Government Used Car Lot traded in 700,000 soot factories on wheels they call ‘clunkers’. Good that we got some unsafe and/or vile vehicles off the road to save Americans from our dependence on foreign oil. Read on.

Given that the average clunker got 12 miles per gallon and the pristine ‘new’ car (with a pristine payment book for our formerly non-spending shoppers) gets 25. Driving 12,000 miles a year, the deathmobile uses 1,000 gallons; the bluebird of vehicular happiness uses 480. Love it.

That’s 520 gallons saved per vehicle. We are geniuses! For the 700,000 vehicles, we just saved 364MILLLION gallons of fuel. We are even more smarter than geniuseseseses! Since we get 23 gallons of automotive fuel from one 55 gallon barrel of oil, that’s about 16MILLION barrels of oil we don’t have to buy!

Take that, Oily Mongers! Since we’re currently gulping down 6million barrels of your crudeness a day, we just saved nearly 3 days worth! HA! Go find another customer!

For my next to last calculation (because my abacus is smoking) at $75 per barrel, that’s a savings of $1.2billion dollars. The savings are racking up like crazy now! The only slight negative here is that it cost us $3billion to save the $1.2b.

If anyone in the health care debate brings up “Cash for Cankers,” I’m moving to New Zealand.

By the way, this is not political commentary, policy debate, or assailing the effort to save fuel or car dealers. This is about shallowness and mismanaged relationships.

Though the Clunker program brought great throngs of people trading in $500 cars for $4500 and the ensuing “great news” of heavy spending surge, I have a fairly dire prediction for the next couple months: ain’t nobody trading in any more clunkers unless you pay ‘em handsomely. Sorry. Get ready for really ‘bad’ car sales numbers. We’ve built an expectation we can’t continue, and it was NOT based on loyalty.

The best relationships may start with an inducement, an urgency, a ‘reward’ (faster service, discount coupon, tax credit offer) but will not last unless one of two things happen. Whether a car dealer or a contractor, the same rules apply:

1. Offer another incentive, equal or better than the last. This shallow “gimme” based relationship is why I caution that over-using Direct Response is like crack, i.e. ‘more is better’. This is a downward spiraling, profit robbing model.
2. Build a solid (preferably programmed) plan of contact that deepens trust, instills confidence, reinforces value, and requires cooperation from both sides.

The first one is easy to offer, harder to maintain. The second is harder to start, easier to maintain. And the second one kicks bootie every time.

You wanted something more glamorous? You wanted me to talk about getting more leads for less dollars, or how to guarantee differentiation in your market? You’d rather learn how to turn one sale into many? You feel our time would be better spent discussing the nuances of phone-melting headlines?

Well, if you practice the rare art of “active” customer retention, all of those things can happen. It is truly, the “X-factor” in a contractor’s marketing arsenal.

Of course, this is already known by a small, well-rewarded group of contractors who’ve held a tight lid on this weapon.

In fact, a few years ago, I began polling contractors on “Who uses customer retention?” and only about 6% did. Now that figure is nearer 11% - and growing.

Given that contractors don’t spend where there’s no result, I’ll let you conclude why this number has nearly doubled in three years. This is also the marketing method that has gotten most of the credit for “saving” contractors in this recession. The profitability among “those who do and those who don’t” seems to be widening as well. Makes sense.

Regardless of which group you’re in, you may find the following useful.

If you already have a Customer Retention program:

• Increase your aggression for maintenance agreements in stand alone mail/email and in your newsletters. Do not limit newsletter mailings to MA customers only, since you want to increase the natural ascension from “normal” customers to MA customers.
• Push for greater differentiation through IAQ initiatives, which, due to a high-tech nature and health slant, can elevate your marketing position considerably. (Request a free IAQ Marketing Report from us if you want to read more.)
• Stealth pursuit of web-based lead generation allows “customized, flexible lead flow” largely under the befuddled noses of your competitors. Those who get in early tend to maintain an advantage. This is inexpensive and fast.
• Continue to wean yourself from Yellow Page addiction to fund and extend your newsletter, thank-you campaigns, and follow-up referral sources. Allow your remaining YP ad to be a pure lead generator – small, fast, and uncluttered.

For New Retention Marketers

For those who have just recently begun a customer retention campaign, allow it to build momentum. Too many contractors get the instant differentiation benefit and positive comments from customers, yet have a tendency to jump to the next thing. These sporadic efforts lose the momentum and bring confusion to your staff. Remember, retention is a program, not an event.

Also, realize that the effect of retention marketing is like compounded interest – the true benefits requires continued application. It builds on itself, multiplying the effects, allowing low-cost marketing advantages for the earned loyalty, shorter sales cycle, easier upsells, more referrals, and a greater response rate.

For the “I’m Still Thinking About it” Group

The remaining 89% of contractors who leave their customer base at risk are either “hoping” their customers come back or must regularly initiate an incentive to generate new leads. Doubtless if you’ve read this far, you’re looking for change.

The first one is to change your mindset. And since it’s my job to be your personal tour guide for guilt trips, check this mind-shift:

• The “normal” contractor gets a customer in order to make a sale.
• The “marketing” contractor gets a sale in order to make a customer.

Admittedly, that sounds odd, and the scarcity of those who actually understand this mind-shift is almost the point. But this should make it clear…

The contractor who is wisely counter-intuitive in marketing wins the marketing. Period. Those who think, act, and do like everyone else get results just like everyone else. I’ve also noticed that his or her complaints are just like everyone else’s too.

So, by really understanding and applying the contractor marketing mindset, you’re automatically in the small segment that has differentiated from the pack. No matter how you initially get your leads and customers, make sure your effort to keep them proves you value them. After all, they’re customers, not clunkers.

Request a free Customer Retention Report and Fall customer newsletter sample.