The Power of Referrals

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

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

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

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

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

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

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

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

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

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

Until Andrew retired from us.

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

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

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

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

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

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

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

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

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

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

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

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

Questions for You:

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

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

Calendar Marketing

I don’t like it when contractors read the weather page to see whether they’ll be busy or not. To me, an utter loss of control. Yet in the 5 “Ms” of marketing, “month” is number 4 and thus mightily important. (This week’s poll: What are the other “M’s”? Guess and you may win fame, shame, or something in between.)

There is great validity to marketing within a known field of “timing” relevance. That is, chocolates during valentines, anti-depressants during the evening news, stuff like that. For another example…

At last report, it had rained 732 times in the past 4 days. It’s so wet, the fish are complaining and I’m going to see if Al Gore can arrange some “Global Drying”. This is neither politics nor weather.

This is about relevant timing and opportunity. In the past 45 days…

We have called a plumber for persistent drainage problem. A roofer for small leaks in two buildings. An HVAC contractor about dehumidifier in one of those buildings. An electrician for a leak-related fault in some track lighting. A neighbor about his gutter system (that he couldn’t see). A landscaper about a diverting berm and French drain.

There were 2,600,000 homes (NOT including commercial) affected in the recent high rainfalls in the southeast alone. Though I’ve occasionally felt like it, I trust I’m not the only one who needed a contractor. Multiply that by at least 6 trades, that’s lots of service calls.

Question: You want them Google searching or YOUgle Searching? Thought so.

This applies to the first cold snap. Most lightning strikes. Most burglaries (for home lighting and security). Most rain, hottest, driest. Energy prices up, energy prices down. And for you, your slowest months need the most attractive off-season offers. (See “Swimsuits in the Winter” ads in your PowerPack and many others, for example.)

All have a timely relevance in the mind of the homeowner, and YOU need to be in their mind when the need hits.

So, while other contractors are scanning the weather page, crime reports, or moaning about how energy prices have risen, you’re forcing your way into their conscious mind, up front and out front of the others leaving it up to chance.

Look at your calendar right now. There is your ‘map’ to marketing relevance. Each month, a wave of consciousness overtakes and replaces the previous. Your job is to be in front of that wave to get the call, as opposed to behind it waiting and hoping. Big difference.

• Did you get your free 12 Month Marketing map yet? We publish about 2,000 per year, and give all of them away, with ZERO chance of “reprinting” once they’re gone. Friendly advice: Make a polite request and get one now. You are now in competition with 12,000 other contractors.

Aside from getting into prospect’s minds ahead of the need, you’re also ‘programming’ your marketing, sometimes up to a year in advance. Think of the load off you, your staff, your budget, and your media contacts. You can use your calendar or ours, but use the season as the reason to program your marketing plan.

If your “negative” voice is saying, “Hey, WHAT IF I market for an item in a month that does NOT produce the highest need for that product?” Then what have you lost?

Was it second highest? Did it only make new 3 times instead of 5?

You may wonder, “What if something just HAPPENS and it was not on the calendar?” Then you readily and aggressively market that.

Quick Case Study: Tornados had stricken an area, resulting in much insurance-covered roofing work. Yet HVAC contractors started getting calls for repairs that should’ve been part of the now-released coverage. Our tactic: Created newspaper, postcard, and radio scripts that began, “Do NOT settle with your Insurance Company until you read this”. And that my friends, landed millions in necessary, legitimately covered work for hundreds of happy homeowners.

The market has a barrier of relevance and you want to penetrate it, with consistent regularity. Be the company who’s “there” in their consciousness as the needs arise. Lead the market, don’t trail it.

Questions for you:

1. What are the TOP ‘calendar driven’ items coming up in the next 90 days?
2. What products and services help solve problems related thereto?
3. What marketing pieces do you have exactly relevant to that solution?

The opportunities are there. Are you? Contact us for help.

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.