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.
Wednesday, April 14, 2010
Thursday, April 1, 2010
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
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
Wednesday, March 17, 2010
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 of this ‘new’ economy, 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 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 and have a reachable quantity. That leads to #2.
Is this your current list, dated list, big ticket buyers, referrals, church bulletin, little league parents, chamber of commerce? I mean, you’ve got to know the size of the pool. To answer whether its even worth fishing the pool, #3 comes into play…
Do they close well? Or are they a bunch of mealy mouth price shoppers? Maybe they’re affluent, 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…
Number 5 relates to finding a better ‘target’ than going back to the ‘pool’ again. Plus, no marketing dollars to find their referrals. The neighborhood, church members, business people in same category, seek commonalities and target your presentation accordingly.
And for #6 and #7 that most contractors miss severely…
What happened to those who didn’t close? You think they were window shopping you for fun? Find out why they didn’t buy and that’s the key to a fortune right there. Resolve that, go kick bootie with a far higher result from #3 - #6.
For #7, this is my age-old but more solid-than-ever (thanks to the economy) “Retention” message. The commonality among contractors doing well and those, um, “not” is powerful retention. Those who didn’t fill the pipeline and then build a high-sided inescapable pool into which it flowed are quite sorry. They had customers in there, but they escaped. Now they get to go back to #1, spending new marketing dollars to recreate what was lost. Not exactly ideal.
Yes, that’s how we multiply your efforts and results from your “existing” incoming leads. And you thought we were magic. All we can really do for you is a) Create a better message to make the phone ring, b) Make sure we aim it at the better targets, c) Let you extract full measure of the results.
Sound like a plan? Go back to your list of incoming leads now. Ask yourself the 7 questions. If you need us to help you fish them deeply, regularly, and to extract full value, that’s why we’re here. Otherwise, you’ve got plenty of bait in this article to catch a boatload.
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 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 and have a reachable quantity. That leads to #2.
Is this your current list, dated list, big ticket buyers, referrals, church bulletin, little league parents, chamber of commerce? I mean, you’ve got to know the size of the pool. To answer whether its even worth fishing the pool, #3 comes into play…
Do they close well? Or are they a bunch of mealy mouth price shoppers? Maybe they’re affluent, 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…
Number 5 relates to finding a better ‘target’ than going back to the ‘pool’ again. Plus, no marketing dollars to find their referrals. The neighborhood, church members, business people in same category, seek commonalities and target your presentation accordingly.
And for #6 and #7 that most contractors miss severely…
What happened to those who didn’t close? You think they were window shopping you for fun? Find out why they didn’t buy and that’s the key to a fortune right there. Resolve that, go kick bootie with a far higher result from #3 - #6.
For #7, this is my age-old but more solid-than-ever (thanks to the economy) “Retention” message. The commonality among contractors doing well and those, um, “not” is powerful retention. Those who didn’t fill the pipeline and then build a high-sided inescapable pool into which it flowed are quite sorry. They had customers in there, but they escaped. Now they get to go back to #1, spending new marketing dollars to recreate what was lost. Not exactly ideal.
Yes, that’s how we multiply your efforts and results from your “existing” incoming leads. And you thought we were magic. All we can really do for you is a) Create a better message to make the phone ring, b) Make sure we aim it at the better targets, c) Let you extract full measure of the results.
Sound like a plan? Go back to your list of incoming leads now. Ask yourself the 7 questions. If you need us to help you fish them deeply, regularly, and to extract full value, that’s why we’re here. Otherwise, you’ve got plenty of bait in this article to catch a boatload.
Wednesday, February 3, 2010
Answer to the Marketing Brain Teaser from Last Entry
Help me. I posed a question to all readers, got a ton of responses, some of which were actually correct and devoid of curse words. ALL were interesting. Very cool to get different perspectives.
Summarized question: “There are four elements in your ‘Marketing Equation’. Two mentioned in the article were ‘incoming leads’ and ‘conversions’ (or commonly ‘closing ratio’). What are the other two?”
Before you read the answer, my intention was to gather the four BIG elements for those of you not running your marketing by formula. I said in the article, “other numbers are just fluff”.
Since I uttered that statement, I’ve been asked to step down by Democrats, Republicans, and the Sham-Wow guy, who is now the Slap-Chop guy. I regret any convenience I may have caused and humbly apologize to everyone except the Yellow Pages.
Admittedly, there ARE other meaningful numbers and I’ve given credit where due.
Here are the winners AND numbers to know in your Direct Response marketing formula, plus another highly insulting remark to the Yellow Pages.
1.Leads generated– only attributable to Direct Response marketing. Direct Response ads have – as their name implies – a lead generation component and are accountable thereto. If you sent out a Holiday Card or TOMA or Retention piece and were hoping to count “leads” as a result, you may as well plant a strawberry vine and start looking for cumquats.
2.Leads converted – Often based on #1 per campaign, but also as a general measure of closing ratio for all leads. I do NOT like blending “all leads” together since a customer calls in as a lead with a 70-80% closing average vs. a ‘first time caller’ with a 30% closing average.
3.Cost per lead – This figures in the media and fulfillment costs and as such, gives you a baseline for measurement. Advertising during the SuperBowl might get you 1,000 leads, but the CPL will likely be rotten. This figure generally runs between $75 and $200, still a potential loser at the lower price (insolvent unsellable prospects) or very profitable at the higher figure. Has to do with transaction size and of course…
4.Profit per sale (I’d have accepted ‘transaction size’ too, since that’s way easier to figure, is more part of marketing than operations.) People often ask, “How many leads should I expect from this campaign?” and there are general numbers (1% from Direct Mail a long accepted but now shrinking ‘standard’) yet even these overlook this more revealing figure. Not only is the list smaller for an $8000 bath remodel for example, it’d take far more $79 drain cleanings to make them equally profitable.
The above is why it is very important to know and use the “Break Even Rate” in direct response marketing, which is revealed below, but FIRST…
The Winners Circle:
There were several correct answers yet the most concise AND correct answer goes to Chris Kowalski who had a 7 word email that said, in its entirety:
1.Cost per lead
2.Profit per closed lead
I like it when people get to the point! All who submitted a correct answer will get a copy of Marketing Secrets. Hope you’ll write us a review!
Yet since I’m completely unfair, biased, and make up the rules as I go along, I’ve decided to award 2 honorable mentions –
The Runners Up:
1.Keith Calicoat wrote, “Decrease acquisition cost per customer and raise the frequency of transaction per customer”, which gets partial credit. Keith also put in, “If I win, I don't want the hot dogs!” Fair enough. That makes two of us.
2.J.S. Woolery from Home Energy suggested “raise average order size”, which is a great way to increase profits NOW from virtually every sale. I still contend that most contractors could increase prices by 10% today, not lose one customer (okay, the cheap ones) and put the entire bump on your paycheck.
BONUS feature today is the Break Even Rate Formula:
A/B = C
(C/D) x 100 = E
(E/F) x 100 = Break even response rate
A= Cost of Direct Response campaign
B = Profit per job/service offered in ‘A’.
C = Minimum job/services needed to break even
D = Average conversion (closing rate) on leads for this type job
E = Number of total leads needed to break even
F = Number of pieces mailed/audience
Obviously, the goal is to exceed “D” and “E” by the largest number you can. Now you know why the combination of these factors rules your fortunes.
I recommend a break even rate on ALL Direct Response ads you do for 2010. But then again, I recommend the slap chop, but only if the Yellow Page ad rep’s finger is in close proximity.
Have an awesome day. Let us help you make it even more of one!
Summarized question: “There are four elements in your ‘Marketing Equation’. Two mentioned in the article were ‘incoming leads’ and ‘conversions’ (or commonly ‘closing ratio’). What are the other two?”
Before you read the answer, my intention was to gather the four BIG elements for those of you not running your marketing by formula. I said in the article, “other numbers are just fluff”.
Since I uttered that statement, I’ve been asked to step down by Democrats, Republicans, and the Sham-Wow guy, who is now the Slap-Chop guy. I regret any convenience I may have caused and humbly apologize to everyone except the Yellow Pages.
Admittedly, there ARE other meaningful numbers and I’ve given credit where due.
Here are the winners AND numbers to know in your Direct Response marketing formula, plus another highly insulting remark to the Yellow Pages.
1.Leads generated– only attributable to Direct Response marketing. Direct Response ads have – as their name implies – a lead generation component and are accountable thereto. If you sent out a Holiday Card or TOMA or Retention piece and were hoping to count “leads” as a result, you may as well plant a strawberry vine and start looking for cumquats.
2.Leads converted – Often based on #1 per campaign, but also as a general measure of closing ratio for all leads. I do NOT like blending “all leads” together since a customer calls in as a lead with a 70-80% closing average vs. a ‘first time caller’ with a 30% closing average.
3.Cost per lead – This figures in the media and fulfillment costs and as such, gives you a baseline for measurement. Advertising during the SuperBowl might get you 1,000 leads, but the CPL will likely be rotten. This figure generally runs between $75 and $200, still a potential loser at the lower price (insolvent unsellable prospects) or very profitable at the higher figure. Has to do with transaction size and of course…
4.Profit per sale (I’d have accepted ‘transaction size’ too, since that’s way easier to figure, is more part of marketing than operations.) People often ask, “How many leads should I expect from this campaign?” and there are general numbers (1% from Direct Mail a long accepted but now shrinking ‘standard’) yet even these overlook this more revealing figure. Not only is the list smaller for an $8000 bath remodel for example, it’d take far more $79 drain cleanings to make them equally profitable.
The above is why it is very important to know and use the “Break Even Rate” in direct response marketing, which is revealed below, but FIRST…
The Winners Circle:
There were several correct answers yet the most concise AND correct answer goes to Chris Kowalski who had a 7 word email that said, in its entirety:
1.Cost per lead
2.Profit per closed lead
I like it when people get to the point! All who submitted a correct answer will get a copy of Marketing Secrets. Hope you’ll write us a review!
Yet since I’m completely unfair, biased, and make up the rules as I go along, I’ve decided to award 2 honorable mentions –
The Runners Up:
1.Keith Calicoat wrote, “Decrease acquisition cost per customer and raise the frequency of transaction per customer”, which gets partial credit. Keith also put in, “If I win, I don't want the hot dogs!” Fair enough. That makes two of us.
2.J.S. Woolery from Home Energy suggested “raise average order size”, which is a great way to increase profits NOW from virtually every sale. I still contend that most contractors could increase prices by 10% today, not lose one customer (okay, the cheap ones) and put the entire bump on your paycheck.
BONUS feature today is the Break Even Rate Formula:
A/B = C
(C/D) x 100 = E
(E/F) x 100 = Break even response rate
A= Cost of Direct Response campaign
B = Profit per job/service offered in ‘A’.
C = Minimum job/services needed to break even
D = Average conversion (closing rate) on leads for this type job
E = Number of total leads needed to break even
F = Number of pieces mailed/audience
Obviously, the goal is to exceed “D” and “E” by the largest number you can. Now you know why the combination of these factors rules your fortunes.
I recommend a break even rate on ALL Direct Response ads you do for 2010. But then again, I recommend the slap chop, but only if the Yellow Page ad rep’s finger is in close proximity.
Have an awesome day. Let us help you make it even more of one!
No Private Investigator
One of the biggest complaints I hear from contractors is, “I just need more leads.” And for the most part, the more leads you get the better. (There are negatives to “too many leads”, but I’m getting ahead of myself which isn’t that hard to do.)
Anyway, absent the need for more leads, we’ll assume you’re getting leads at rate ‘x’ and converting ‘y’ to sales. Ridiculously, MOST contractors focus way harder on the ‘y’ (closing or conversion rate) than increasing ‘x’.
The trick to massive sales growth is increasing both.
NOTE: There’s a ‘third’ and ‘fourth’ element in this equation that are the ONLY numbers worth following in your sales stream. Most everything else is just fluff. The next 10 people to tell me EITHER of those will win either a) A pack of unrefrigerated hot dog wieners or b) A first-class marketing book that I just happened to write. If you choose ‘a’, I’ll assume you have a copy. The email link to send your answer is found after the ‘click’.
So, delving into your current leads – the ones you’re getting today, right now - there are two questions to consider:
1. Where did they come from? (Media source, which includes your own database.)
2. What happened after the call?
About 70% of contractors DO NOT gather the source. Since all marketing should have an ROI, this is like not asking the bank about the interest rate. This economy rewards prudency. The days of “guessing” with unproven marketing are over.
As far as “What happened” after the call, slightly more than 70% only know TWO things: It sold. It didn’t sell. And that boys and girls, is flat out silly.
I’ll get right to it:
The five things are –
1.Sold: Transaction size? Previous/new customer? Attempted upsell? Attempted Agreement sale? Equipment survey? (That is, do they need IAQ, adding a bath, discuss security lighting? etc.) The survey alone is free, leads to far more gold from the database in this ONE step.
2.Sold: Follow up procedure. Thank you call with referral bump. Thank you letter with referral bump.
3.Sold: Relationship and referral procedure started. (Added to hard copy Newsletter, ezine list.) A 30 day schedule of recontact becoming more prevalent, but if you have none, every 90 to start.
4.Didn’t sell: Reason? Elimination of reason? Set follow up appointment? Incentive to call YOU back? Clearly state next action step.
5.Didn’t sell: Result of follow up contact. (Minimum of 3: >Phone call plus email. >Letter/postcard. > Phone call. If remains unsold, then low cost relationship procedure started. Email reminders, always included in direct mail campaigns.
If you can just change your response to the outcome, you can generate far more sales with very little effort or out of pocket costs. You’ve already PAID for the lead, why not extract full value? (Yes, I’m cheap.)
And now for the promise to improve your CSR’s performance today -
Tracking leads is important because if not, you might be wasting money on dud ads. It’s so easy to do. All you have to do is instruct your customer service representatives (or whoever answers the phone and fills appointments) to simply ask the customer how they found out about you.
You may be shocked by what you discover. What media brings the best ROI? How strong is your word of mouth? How many referrals are you getting now? How can you triple that?
Even better, you get a chance to prove your superiority on the phone. First, I make no secret that I hate automated attendants. The world in fact, would like to strangle the next auto attendant they see.
Yet even if your callers aren’t forced to press buttons for five minutes or aren’t on hold for listening to some top 40 station – a CSR can still blow it. Here are 3 things your customer service reps should always avoid saying:
1.“Well, you’re going to have to…” No. The first thing the customer is going to think is, “Come on! I don’t have to do anything!” Ask nicely. Try, “In order for us to provide you the best service, would you mind…” or “Could you please provide me with this information so that we can be sure to omit any possibility for a mistake?” Let the customer know that he or she is helping to facilitate the fixing and they’ll be much more likely to respond with something other than a quick hang-up.
2.“I’ll try…” Don’t try. Either say you’ll do it or tell them no. If you don’t give huge discounts on new systems, then say you can’t do that at present. Don’t say you’ll try to get them a discount if you know it won’t happen! Customers resent a lack of commitment, so don’t show that weakness.
3.“It’s against our policy.” It’s hard to dodge this for one main reason. The company policy is there because it needs to be followed. Just don’t use this phrase. Customers can’t stand to hear it and it has become one of those horrid business clichés that CSRs use as a scapegoat to avoid extra work or explanation. You owe the people who pay your bills (your customers) an explanation. At the very least, substitute this worn out phrase with words like “our best procedure” or “proven approach”.
Okay, I’ve given you more than your money’s worth for today (especially considering the price) and ask you to pick an action to go implement.
Soon you can be reading a profitable book or have a nice lunch to send your competitors.
Anyway, absent the need for more leads, we’ll assume you’re getting leads at rate ‘x’ and converting ‘y’ to sales. Ridiculously, MOST contractors focus way harder on the ‘y’ (closing or conversion rate) than increasing ‘x’.
The trick to massive sales growth is increasing both.
NOTE: There’s a ‘third’ and ‘fourth’ element in this equation that are the ONLY numbers worth following in your sales stream. Most everything else is just fluff. The next 10 people to tell me EITHER of those will win either a) A pack of unrefrigerated hot dog wieners or b) A first-class marketing book that I just happened to write. If you choose ‘a’, I’ll assume you have a copy. The email link to send your answer is found after the ‘click’.
So, delving into your current leads – the ones you’re getting today, right now - there are two questions to consider:
1. Where did they come from? (Media source, which includes your own database.)
2. What happened after the call?
About 70% of contractors DO NOT gather the source. Since all marketing should have an ROI, this is like not asking the bank about the interest rate. This economy rewards prudency. The days of “guessing” with unproven marketing are over.
As far as “What happened” after the call, slightly more than 70% only know TWO things: It sold. It didn’t sell. And that boys and girls, is flat out silly.
I’ll get right to it:
The five things are –
1.Sold: Transaction size? Previous/new customer? Attempted upsell? Attempted Agreement sale? Equipment survey? (That is, do they need IAQ, adding a bath, discuss security lighting? etc.) The survey alone is free, leads to far more gold from the database in this ONE step.
2.Sold: Follow up procedure. Thank you call with referral bump. Thank you letter with referral bump.
3.Sold: Relationship and referral procedure started. (Added to hard copy Newsletter, ezine list.) A 30 day schedule of recontact becoming more prevalent, but if you have none, every 90 to start.
4.Didn’t sell: Reason? Elimination of reason? Set follow up appointment? Incentive to call YOU back? Clearly state next action step.
5.Didn’t sell: Result of follow up contact. (Minimum of 3: >Phone call plus email. >Letter/postcard. > Phone call. If remains unsold, then low cost relationship procedure started. Email reminders, always included in direct mail campaigns.
If you can just change your response to the outcome, you can generate far more sales with very little effort or out of pocket costs. You’ve already PAID for the lead, why not extract full value? (Yes, I’m cheap.)
And now for the promise to improve your CSR’s performance today -
Tracking leads is important because if not, you might be wasting money on dud ads. It’s so easy to do. All you have to do is instruct your customer service representatives (or whoever answers the phone and fills appointments) to simply ask the customer how they found out about you.
You may be shocked by what you discover. What media brings the best ROI? How strong is your word of mouth? How many referrals are you getting now? How can you triple that?
Even better, you get a chance to prove your superiority on the phone. First, I make no secret that I hate automated attendants. The world in fact, would like to strangle the next auto attendant they see.
Yet even if your callers aren’t forced to press buttons for five minutes or aren’t on hold for listening to some top 40 station – a CSR can still blow it. Here are 3 things your customer service reps should always avoid saying:
1.“Well, you’re going to have to…” No. The first thing the customer is going to think is, “Come on! I don’t have to do anything!” Ask nicely. Try, “In order for us to provide you the best service, would you mind…” or “Could you please provide me with this information so that we can be sure to omit any possibility for a mistake?” Let the customer know that he or she is helping to facilitate the fixing and they’ll be much more likely to respond with something other than a quick hang-up.
2.“I’ll try…” Don’t try. Either say you’ll do it or tell them no. If you don’t give huge discounts on new systems, then say you can’t do that at present. Don’t say you’ll try to get them a discount if you know it won’t happen! Customers resent a lack of commitment, so don’t show that weakness.
3.“It’s against our policy.” It’s hard to dodge this for one main reason. The company policy is there because it needs to be followed. Just don’t use this phrase. Customers can’t stand to hear it and it has become one of those horrid business clichés that CSRs use as a scapegoat to avoid extra work or explanation. You owe the people who pay your bills (your customers) an explanation. At the very least, substitute this worn out phrase with words like “our best procedure” or “proven approach”.
Okay, I’ve given you more than your money’s worth for today (especially considering the price) and ask you to pick an action to go implement.
Soon you can be reading a profitable book or have a nice lunch to send your competitors.
Tuesday, December 22, 2009
Let’s Play Stump the Stumpy Guy
I usually do the interviews for our coaching calls. I actually like being on that side of the mike, hopefully helping “decomplicate” the expert’s topic, cutting volumes of information into bite-sized chunks, suitable for complete digestion.
But last Thursday, at 5:30 pm, it was my turn to squirm. Copywriting and marketing superstar Dan Kennedy called to interview me for his apparently information-starved Copywriting Students. In my world, being interviewed by Dan Kennedy is like having Jimmy Johnson ask you to drive him around the block.
For one hour, I had to fake my way through sounding intelligent. And in this smart, tough crowd with a fairly expensive $30,000 annual tuition, that wasn’t going to be easy. So, in-between making up big words and ending every other sentence with “in this economy” to sound relevant, I attempted to offer advice.
The REAL reason I was on the call was for having been the idiot who won a new car last year, but turned it down in exchange for an equal amount ($35,000) of copywriting work from contest sponsor Kennedy. Yes, I – the self-proclaimed copywriter – sort of “paid” 35 large for 8 pages of work.
Whatever. I didn’t need the car, but felt I could use learning from a good coach. (Can’t we all?) Of course, those winnings became yours because we took what we learned and applied it to not only our marketing, but to what we offer you.
But during the interview, amid all these people ‘tuned in’ to hear the answers, Dan throws me a curveball. He asks, “If you had all your copywriting tools taken away except 3, what would they be?” There I am, mildly choked to answer, clock ticking, sweat forming. And it’s below.
Whether you’re copywriting “student” or not, the answers still go to the core of marketing. Remember, this was not a “beginner” crowd, so my answers aren’t the normal “big headline, bold guarantee, and hot bullet points” that you’re sick of hearing. And shockingly enough, in the light of day, I still stick by these answers…
Below, you’ll see my answer. I’ve put in italics how you can use this hint in your business, whether marketing, selling, or negotiation. They work for all, and that’s a promise. So, a peek behind the marketing curtain…
AH: “Well Dan, I’m a big fan of the Provocative Headline, Big Promise Headline, The Killer Offer, Powerful Guarantee, and all that, but I assumed – hopefully correctly – that your students (and I frankly) have enough resources on those topics from you and other training. Here are the ones I consider more advanced, more stealthy, that you do NOT hear about much, but generate massive results for us and our clients -
1. I’ll call the first one ‘Planting Psychic’ Seeds. Some may call it ‘empathy’ but its more than that. I like to write as if I’m listening in on what keeps these guys up at night, and shock them with the well placed ‘prediction’ of that state.
The “You’re probably wondering…” is a nearly worn-out but effective version of that. I want to let my clients know that I understand what keeps them up at night, or the problems they’ve faced, or even where their mind is at the moment.”
Contractors – you too want to do this. Force your marketing language, website, sales presentations to enter your customer’s subconscious. Make them say, ‘YES! That’s what I was just thinking!” and you will magnetically gain acceptance. People want to be understood without having to explain themselves.
2. Curiosity Accelerators – I often drop in a foreshadowed thought, hinting at something yet to come. I try to give the readers’ subconscious a moment to dwell, then DESIRE the object of their curiosity. Such as, “I’ll explain that in a moment, but first, here’s why nobody’s doing it…” See? They hear, they hang, anticipation and momentum are built.
Contractors – This is done WAY too little in your websites, and especially your sales presentations. Your Maintenance Agreement forms are the WORST at this. Why? They tell too much, too quickly, ending forever the ability to let the customer ‘weigh’ out the value before you blurt it in their face OR attempt to defend it! An example:
Websites stupidly put, “Read what others say” as if anyone really goes to read a bunch of bragging. Curiosity is OVER. We all know it’s awesome or you wouldn’t put it there. Instead, pepper it ‘inside’ the message, such as “You’re probably thinking I’m full of beans, but so did David Wanker from Canker who said…”
See the difference? Don’t make ‘em hunt it down. Make them want it. Also…
Most Agreements typically line up a bunch of gobbledegook on a page that is SUPPOSED to seem beneficial, but it’s tiresome, boring, hogwash to a customer. All they’re scanning for is the price, but nothing else means anything to them. Instead, you should line up and explain why the bullet point is tantalizingly valuable, THEN put your price in the two-tier method, compared against an UNmaintained system failure.
3. My next most crucial element is “The Turn” as Maxwell Sackheim called it. This is very difficult for most amateur marketers and salespeople. This is where you go from consultive coach to presenting the offer they should accept. I mean, if they’ve expressed a need, it is your duty to present a viable offer.
Contractors – too much of your marketing, and many of your “salespeople” simply spout off specs, scribble something down, and blurt out a price as if magically people’s Visa cards will float from their highly guarded wallets. Ain’t gonna happen. That’s called “Order taking” not “Selling”.
The turn is where you skillfully build a communication “bridge” from “I know you, and know you have this problem” to “Now that we know each other, here’s how to solve it. Just look.”
Your presentations and marketing sales pieces have 3 parts: the opener, the presentation, and the close. These are essentially seamless except for a clinical sales discussion, and the turn is between presentation and close. So, if you’ve got great presentation skills and a lousy closing ratio, it is THE TURN that is causing you to fall flat.
All successful infomercials have “the turn”; watch them. (Heck, all great movies and books have “the turn”) Become a student of the turn.
So, there’s your look into a formerly secretive ‘list’ of items I use to persuade you, and you to persuade others, now advising you to use in your marketing and selling. Happy Sales!
Adams Hudson
Questions:
□ If I took all your marketing tools away except 3, what items would YOU keep?
□ How effectively are your sales presentations at any of the 3 items on MY list above?
□ Do your sales presentations need a makeover?
□ Does your marketing need to be polished up for 2010?
But last Thursday, at 5:30 pm, it was my turn to squirm. Copywriting and marketing superstar Dan Kennedy called to interview me for his apparently information-starved Copywriting Students. In my world, being interviewed by Dan Kennedy is like having Jimmy Johnson ask you to drive him around the block.
For one hour, I had to fake my way through sounding intelligent. And in this smart, tough crowd with a fairly expensive $30,000 annual tuition, that wasn’t going to be easy. So, in-between making up big words and ending every other sentence with “in this economy” to sound relevant, I attempted to offer advice.
The REAL reason I was on the call was for having been the idiot who won a new car last year, but turned it down in exchange for an equal amount ($35,000) of copywriting work from contest sponsor Kennedy. Yes, I – the self-proclaimed copywriter – sort of “paid” 35 large for 8 pages of work.
Whatever. I didn’t need the car, but felt I could use learning from a good coach. (Can’t we all?) Of course, those winnings became yours because we took what we learned and applied it to not only our marketing, but to what we offer you.
But during the interview, amid all these people ‘tuned in’ to hear the answers, Dan throws me a curveball. He asks, “If you had all your copywriting tools taken away except 3, what would they be?” There I am, mildly choked to answer, clock ticking, sweat forming. And it’s below.
Whether you’re copywriting “student” or not, the answers still go to the core of marketing. Remember, this was not a “beginner” crowd, so my answers aren’t the normal “big headline, bold guarantee, and hot bullet points” that you’re sick of hearing. And shockingly enough, in the light of day, I still stick by these answers…
Below, you’ll see my answer. I’ve put in italics how you can use this hint in your business, whether marketing, selling, or negotiation. They work for all, and that’s a promise. So, a peek behind the marketing curtain…
AH: “Well Dan, I’m a big fan of the Provocative Headline, Big Promise Headline, The Killer Offer, Powerful Guarantee, and all that, but I assumed – hopefully correctly – that your students (and I frankly) have enough resources on those topics from you and other training. Here are the ones I consider more advanced, more stealthy, that you do NOT hear about much, but generate massive results for us and our clients -
1. I’ll call the first one ‘Planting Psychic’ Seeds. Some may call it ‘empathy’ but its more than that. I like to write as if I’m listening in on what keeps these guys up at night, and shock them with the well placed ‘prediction’ of that state.
The “You’re probably wondering…” is a nearly worn-out but effective version of that. I want to let my clients know that I understand what keeps them up at night, or the problems they’ve faced, or even where their mind is at the moment.”
Contractors – you too want to do this. Force your marketing language, website, sales presentations to enter your customer’s subconscious. Make them say, ‘YES! That’s what I was just thinking!” and you will magnetically gain acceptance. People want to be understood without having to explain themselves.
2. Curiosity Accelerators – I often drop in a foreshadowed thought, hinting at something yet to come. I try to give the readers’ subconscious a moment to dwell, then DESIRE the object of their curiosity. Such as, “I’ll explain that
Contractors – This is done WAY too little in your websites, and especially your sales presentations. Your Maintenance Agreement forms are the WORST at this. Why? They tell too much, too quickly, ending forever the ability to let the customer ‘weigh’ out the value before you blurt it in their face OR attempt to defend it! An example:
Websites stupidly put, “Read what others say” as if anyone really goes to read a bunch of bragging. Curiosity is OVER. We all know it’s awesome or you wouldn’t put it there. Instead, pepper it ‘inside’ the message, such as “You’re probably thinking I’m full of beans, but so did David Wanker from Canker who said…”
See the difference? Don’t make ‘em hunt it down. Make them want it. Also…
Most Agreements typically line up a bunch of gobbledegook on a page that is SUPPOSED to seem beneficial, but it’s tiresome, boring, hogwash to a customer. All they’re scanning for is the price, but nothing else means anything to them. Instead, you should line up and explain why the bullet point is tantalizingly valuable, THEN put your price in the two-tier method, compared against an UNmaintained system failure.
3. My next most crucial element is “The Turn” as Maxwell Sackheim called it. This is very difficult for most amateur marketers and salespeople. This is where you go from consultive coach to presenting the offer they should accept. I mean, if they’ve expressed a need, it is your duty to present a viable offer.
Contractors – too much of your marketing, and many of your “salespeople” simply spout off specs, scribble something down, and blurt out a price as if magically people’s Visa cards will float from their highly guarded wallets. Ain’t gonna happen. That’s called “Order taking” not “Selling”.
The turn is where you skillfully build a communication “bridge” from “I know you, and know you have this problem” to “Now that we know each other, here’s how to solve it. Just look.”
Your presentations and marketing sales pieces have 3 parts: the opener, the presentation, and the close. These are essentially seamless except for a clinical sales discussion, and the turn is between presentation and close. So, if you’ve got great presentation skills and a lousy closing ratio, it is THE TURN that is causing you to fall flat.
All successful infomercials have “the turn”; watch them. (Heck, all great movies and books have “the turn”) Become a student of the turn.
So, there’s your look into a formerly secretive ‘list’ of items I use to persuade you, and you to persuade others, now advising you to use in your marketing and selling. Happy Sales!
Adams Hudson
Questions:
□ If I took all your marketing tools away except 3, what items would YOU keep?
□ How effectively are your sales presentations at any of the 3 items on MY list above?
□ Do your sales presentations need a makeover?
□ Does your marketing need to be polished up for 2010?
Repeating History’s Repetition
For some reason, a group of historian type people want to tour our offices this Sunday. Further, they’ve asked me to speak to them in some meaningful fashion, relating the historic mission for downtown and our role in it. Personally, I feel they’re really hoping I’ll say nothing but serve Bourbon.
Long time SMI readers will remember that our renovation of this 1880’s building (5 years ago) employed most every tradesperson in 3 counties, including trades that hadn’t been invented at the time. I was billed virtually every time they inhaled, and charged overtime for their exhales.
There were many excellent, pleasant, skilled techs and companies that came through here, doing exquisite work that has withstood great use. There were also a few tradespeople with skills and attitudes that rival meth-addicted wharf rats, except with less dexterity.
Of all those trades folks – perhaps 20 in all – I still use exactly 3.
That coveted group includes:
The electrician (charges more per hour than a cosmetic surgeon, but worth it… darn it), the roofer (needs shock therapy to return a phone call, but competent and fair) and the HVAC company (undermarketed to a fault, but fair and reliable.)
Why do I still use them? And why will I unhesitatingly recommend them to the 30 or so assembled ‘influence peddlers’ on Sunday, and any other time? The reasons you’ll read are the exact same as why they’re doing well in this economy, and the others, well, aren’t.
A “hint” given first …
The historic group this Sunday is touring properties to see and hear firsthand: 1) How does a historic building function into today’s business environment? 2) What obstacles and advantages does a commercial restoration entail? And 3) How does an overly-critical short guy ever get to manage anything? Plus, why can’t he spell “INC” properly?
In addition, every time there’s a tour through here, people also ask “Who” did the work? What’s generally implicit in the question is “Who would you recommend?” (Pointless to give names of the UNrecommended.) And there’s a free lead source for the contractors who understand and work this angle. I may only be telling 30 or so people on Sunday, but they all have homes (I think) and are “influence peddlers” to their peer group. Very important. Somewhere in your town, right now, someone’s asking a knowledgeable person “Who do you use for your?”
How did these 3 companies get to be the answer?
1) Relentlessly regular contact. I promise you, I could not – at gunpoint – tell you the name of the plumber. Or the tile setter, landscaper, brick mason, window man, painter, or locksmith… all of whom I’ve needed several times since, and been asked about umpteen times more. But the “chosen” tradespeople have stayed in touch, making them a) Stand out against the sea of ‘call-me-if-you-need-me’ nincompoops who FORGOT that people FORGET (ironic isn’t it?), and b) Rise to the top of ‘recall heirarchy’ as Maslow said it or TOMA as we say it, plus c) They become the default choice for referrals. Smart to recontact. They stay in touch ‘mostly’ through mail, occasionally by phone. Two attempted ezines earlier, but those floundered and were systemically eliminated in favor of regular mail.
2) They use Professionalism as a Competitive Advantage. This is going to make some of you mad. Whatever. Trades in general do NOT have a very professional demeanor, thus status, assumptions, and price points are commensurate. I don’t make the rules, but you tell me – Two guys have IDENTICAL diamonds for sale. One guy is in an exquisitely elegant, hushed environ, immaculately dressed and as polished as the gem he represents. The other is wearing an Alice in Chains T-shirt, hasn’t shaved, and smells vaguely of Vienna Sausage. Which one are YOU going to confidently pay WAY more money to? Oh, silly me, I never mentioned that either one spoke. Guy #1 coulda been on out work release and Guy #2 a graduate gemologist, but you didn’t wait to make your judgment either. You got that impression purely by the professional ‘aura’ presented. Don’t expect your customers to be any different.
3) Great Customer Service Creates Price Elasticity and Pain of Disconnect. That’s a mouthful, but a high degree of Customer Service means I “pay” more but “get” more… though largely intangible and without ‘cost’ to the company. This is attributable to general courtesy, appointments confirmed, neatness, prices submitted upfront, material options presented, follow-ups initiated by the company, and thank you via phone and with invoice. After that, I’m in their “sequence” (newsletter, recontact, see #1.) The “Pain of Disconnect” is a direct response marketing term for a loyalty creation that is hard to ‘unhook’, thus, “going back” to the non-Customer oriented contractor makes an odious comparison. Good customer service is by nature, relatively rare, highly attractive, and very “sticky”. Train for this and financial gains naturally flow.
Maybe you read this and say you “knew” these 3 elements, are sick of hearing of them in some form or fashion, and were looking for something “new”. Why? History, as they say, is a great teacher.
Questions for You:
1. What is your ‘system’ of recontact? There is no “winging it” in a system.
2. What is ONE THING you could do TODAY to bump your professionalism? (Phone courtesy, uniforms, truck rewrap, new logo, better ads, scripted presentation, burn the Alice in Chains shirts?)
3. Scale of 1-10, what is your company’s customer service ranking? How could you make it go up today?
Long time SMI readers will remember that our renovation of this 1880’s building (5 years ago) employed most every tradesperson in 3 counties, including trades that hadn’t been invented at the time. I was billed virtually every time they inhaled, and charged overtime for their exhales.
There were many excellent, pleasant, skilled techs and companies that came through here, doing exquisite work that has withstood great use. There were also a few tradespeople with skills and attitudes that rival meth-addicted wharf rats, except with less dexterity.
Of all those trades folks – perhaps 20 in all – I still use exactly 3.
That coveted group includes:
The electrician (charges more per hour than a cosmetic surgeon, but worth it… darn it), the roofer (needs shock therapy to return a phone call, but competent and fair) and the HVAC company (undermarketed to a fault, but fair and reliable.)
Why do I still use them? And why will I unhesitatingly recommend them to the 30 or so assembled ‘influence peddlers’ on Sunday, and any other time? The reasons you’ll read are the exact same as why they’re doing well in this economy, and the others, well, aren’t.
A “hint” given first …
The historic group this Sunday is touring properties to see and hear firsthand: 1) How does a historic building function into today’s business environment? 2) What obstacles and advantages does a commercial restoration entail? And 3) How does an overly-critical short guy ever get to manage anything? Plus, why can’t he spell “INC” properly?
In addition, every time there’s a tour through here, people also ask “Who” did the work? What’s generally implicit in the question is “Who would you recommend?” (Pointless to give names of the UNrecommended.) And there’s a free lead source for the contractors who understand and work this angle. I may only be telling 30 or so people on Sunday, but they all have homes (I think) and are “influence peddlers” to their peer group. Very important. Somewhere in your town, right now, someone’s asking a knowledgeable person “Who do you use for your
How did these 3 companies get to be the answer?
1) Relentlessly regular contact. I promise you, I could not – at gunpoint – tell you the name of the plumber. Or the tile setter, landscaper, brick mason, window man, painter, or locksmith… all of whom I’ve needed several times since, and been asked about umpteen times more. But the “chosen” tradespeople have stayed in touch, making them a) Stand out against the sea of ‘call-me-if-you-need-me’ nincompoops who FORGOT that people FORGET (ironic isn’t it?), and b) Rise to the top of ‘recall heirarchy’ as Maslow said it or TOMA as we say it, plus c) They become the default choice for referrals. Smart to recontact. They stay in touch ‘mostly’ through mail, occasionally by phone. Two attempted ezines earlier, but those floundered and were systemically eliminated in favor of regular mail.
2) They use Professionalism as a Competitive Advantage. This is going to make some of you mad. Whatever. Trades in general do NOT have a very professional demeanor, thus status, assumptions, and price points are commensurate. I don’t make the rules, but you tell me – Two guys have IDENTICAL diamonds for sale. One guy is in an exquisitely elegant, hushed environ, immaculately dressed and as polished as the gem he represents. The other is wearing an Alice in Chains T-shirt, hasn’t shaved, and smells vaguely of Vienna Sausage. Which one are YOU going to confidently pay WAY more money to? Oh, silly me, I never mentioned that either one spoke. Guy #1 coulda been on out work release and Guy #2 a graduate gemologist, but you didn’t wait to make your judgment either. You got that impression purely by the professional ‘aura’ presented. Don’t expect your customers to be any different.
3) Great Customer Service Creates Price Elasticity and Pain of Disconnect. That’s a mouthful, but a high degree of Customer Service means I “pay” more but “get” more… though largely intangible and without ‘cost’ to the company. This is attributable to general courtesy, appointments confirmed, neatness, prices submitted upfront, material options presented, follow-ups initiated by the company, and thank you via phone and with invoice. After that, I’m in their “sequence” (newsletter, recontact, see #1.) The “Pain of Disconnect” is a direct response marketing term for a loyalty creation that is hard to ‘unhook’, thus, “going back” to the non-Customer oriented contractor makes an odious comparison. Good customer service is by nature, relatively rare, highly attractive, and very “sticky”. Train for this and financial gains naturally flow.
Maybe you read this and say you “knew” these 3 elements, are sick of hearing of them in some form or fashion, and were looking for something “new”. Why? History, as they say, is a great teacher.
Questions for You:
1. What is your ‘system’ of recontact? There is no “winging it” in a system.
2. What is ONE THING you could do TODAY to bump your professionalism? (Phone courtesy, uniforms, truck rewrap, new logo, better ads, scripted presentation, burn the Alice in Chains shirts?)
3. Scale of 1-10, what is your company’s customer service ranking? How could you make it go up today?
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