Who Should You Spend Time With?

"There are so many prospects to call on! I really don't know where to start! If only I had a system that I could handle." Jane was tossing and turning in bed at 4 a.m. Her husband sat straight up in bed and said, "enough, you're driving me crazy. Tomorrow I will take you to Mr. Bob who knows about systems for crazy people like you. Now let's get some sleep."

After breakfast Harry phoned Mr. Bob to find if he could spend time with his sleep-deprived wife. At 10:30 am they had settled down in Mr. Bob's deli and were sipping on their double Turkish coffee. Mr. Bob walked over and commented, "You must be really desperate to be drinking that stuff."

Jane started by explaining that in her financial services business she was spending too much time running around doing a lot yet still producing few results. She knew that she had to simplify her efforts to build and grow her business.

Mr. Bob thought for a moment, smiled and recounted a true story of someone with a similar problem whom he had helped.

"I have a good friend named Bruce," he said. "We both like systems that make our lives simple. With our collective knowledge we came up with Bruce's Funnel system."

"In essence, we took all of Bruce's market and put them at the top of an imaginary funnel. As members of this market became more and more interested in Bruce's products, they became hotter and hotter prospects as they reached the spout at the bottom of the funnel."

"These prospects then became customers. That is the model of how we qualified his potential market. The reason for this model was to put in place promotions that would move a prospect towards being a customer. Newsletters, seminars and articles accomplished this for Bruce."

Bruce was now free to spend more time on productive things. Of course, he spent time working with his customers but he recognized that he needed to build better relationships and turn customers into clients. Customers just buy stuff whereas clients have a stronger relationship.

"Bruce also recognized that there was a third category. These categories produced referrals and in some cases were not customers or clients. They could be friends, family and associates. He recognized that this resource was his most profitable."

"Bruce's strategy was to concentrate on building more word of mouth referrals from his existing referral partners and spending time to increase this referral network to others."

"The results of his efforts were quite interesting. He found that the promotional activities became a liability, and the real revenue producers were his word of mouth referral networks."

Jane just sat there stunned.

"You mean that Bruce spent most of his time working with people who gave him referrals, and converting clients and identifying other natural referral producers? How did he do it?"asked Jane.

Mr. Bob replied that, in Bruce's case, he loved to play golf and he built relationships by playing golf with people who were likely to give him referrals. Others, he took to plays or sent them tickets, took to dinner and, to some, he just said "thank you" and mean it, the results are huge.

The point is people like to be recognized and appreciated for helping you. When you say thank you and mean it the results are huge.

In summary:

• Identify your referral producers
• Set up a system to monitor referrals
• Say thank you for referrals
• Don t waste time with non-referral-generating pastimes

Mine Your Assets

Mr. Bob had a visit from a small business owner who owned a residential cleaning company. She wanted to build her business and had budgeted another $2,000 for advertising. She wanted guidance on how best to promote her business.

Mr. Bob asked the business owner what she had done in the past, and she replied that she had spent $2,000 on advertising. Mr. Bob asked if the advertising had worked.

"What do you mean, did it work? When you buy advertising there are no guarantees. You place an ad and hope that it works. It is just part of doing business," was her reply.

"Well, let's try and work out what results you got from the advertising. Let's measure your advertising success. How many clients do you have and how much revenue do they generate?"

The owner responded that she had 39 clients, each of whom paid her $45.00 a month or approximately $600.00 a year.

To Mr. Bob's next question, "Out of those 39 clients, how many became clients as a result of your $2,000 of advertising?" the owner replied that the advertising had brought one new client to her.

"So why do you think advertising is the way build your business?" asked Mr. Bob. "You have 39 customers, of whom only one came directly as a result of advertising. Where did the other 38 clients come from?"

She replied that they had come from friends, family, word of mouth and referrals.

"Well, then," said Mr. Bob said, "Let's look at how best to build your business. Your greatest success in gaining new customers comes by word of mouth referrals. What do you think would happen if you developed an incentive program for giving you referrals? For example, if one of your customers gave you a referral, you could acknowledge that referral and show your appreciation by giving your customer a gift -- flowers, a dinner out, a free cleaning up to the value of $45, or if the referral generated a larger contract, you could give a larger gift. What do you think would be the result of that type of advertising?"

"I would get lots of new customers," she said.

In summary:

• Does your advertising work?
• Is advertising the method to build your business?
• Ask yourself, what approach gets your best clients
• Identify and act on the strategies that make sense, not nonsense

More Than Just a Place to Buy Stuff

Henry Miller, a car salesman, was not having a good day. As a customer service representative and sales associate for a large company, he dealt with clients and looked for new prospects on a daily basis. But today, nothing seemed to be working. He had used his regular sales pitch of emphasizing the value of the products his company offered, the reasonable prices, and the easy payment policy. No one was buying and he couldn t understand why. He was relatively new to this company, and didn't want to lose his job, but he couldn't see how he'd be able to make any commissions selling products that everyone else seemed to carry. Thoroughly frustrated, he put his head into his hands and tried to think of what he'd been doing wrong.

Frank Simes was Henry's supervisor. He'd been monitoring Henry's calls and watching Henry's frustration mount and, deciding to do something about it, called Henry into his office.

"This is it. I'm going to be canned," Henry thought, as he followed Frank into the inner office. Surprisingly, instead of being fired, Henry found himself being invited to lunch.

As they walked to lunch, Frank asked about Henry's family and how he liked working for the company. Henry talked animatedly about his wife and children and more cautiously about his job.

"Here we are," Frank said, stopping suddenly in front of a corner grocery store. The store was small and well kept, with bright signs proclaiming, "Welcome" and "Come on in".

For the second time that day, Henry was confused. He hadn't even known the grocery store was there. He usually went to the larger chain grocery store around the corner. And he never would have thought that they served lunch.

Looking around curiously, Henry saw that, even though it was a small store, the cashier's line was full and people were milling around filling their baskets. Henry couldn't believe that this store had such a steady clientele. He would have thought the larger store around the corner would have drawn all the customers away.

Settling down at the cafe tables near the deli counter, Frank began to talk. "I'm sure you're wondering why I brought you here for lunch," he began.

"It had crossed my mind," Henry said, swallowing nervously.

"When you look around, what do you see?" Frank asked. Sensing a trick question, Henry hesitated, trying to find the "right" answer.

"Let me tell you what I see," Frank said, letting him off the hook.

"I see rows upon rows of neatly arranged, and easily obtained food products. Products that can be purchased at the larger chain store around the corner, and are probably cheaper than here. I see nothing special or significantly different in the layout of the store, or the quality of the produce. Yet the store is full of happy and purchasing, customers." Henry listened quietly, his eyes following Frank's hands as they gestured about the store.

"You have to ask yourself then, as a sales professional, how this small, ordinary store has survived the appearance of a larger, flashier chain store around the corner." Frank paused to take a sip of his drink.

"Let's look again and try to figure it out. See there, near the cashier. That sign on the wall that says "Ask about our Birthday Club". There's a clue for you."

"A clue? The Birthday Club is a clue? What is The Birthday Club?" Henry asked, amused and a little intrigued.

Frank smiled. "So glad you asked. The Birthday Club is a program the owner set up to give a little something to his customers on their birthday. Mr. Bob, that's what everyone calls him, collects his customers' information, what they buy and sends them a gift and a gift certificate on their birthday. Sometimes it's a little bookmark or other such trinket, but always something he feels the customer will like. He includes a gift certificate for a certain amount and chooses a birthday card to go with it. It's been a big hit with the customers, and it gives Mr. Bob something valuable at the same time."

"What does Mr. Bob get in return? He gets to know his customers, their likes and dislikes, and their buying needs."

"How is that information valuable?" Henry asked.

"Once the chain store moved in a few years ago, Mr. Bob knew he'd have to offer something to his customers that they couldn't get in the other store. He realized that people today were not buying products in the same way any longer. Many stores carried the same products with minor variations. So how did customers choose whom to buy from? He determined that people were buying personality, not product. He began to get to know his regular clients, and to try to reach his occasional ones. He tries to greet them by name, if possible, and suggest products that match their interests. A funny thing happened when he started doing this. He noticed that more and more people were discovering his store.

He hadn't spent anything more than usual on traditional advertising, but his sales had increased. He began to send thank you cards out to people who referred their friends and family to his store. Little things that didn't cost him very much, but that made the customers feel good about shopping here and remembering his store."

"So, what you're saying is, instead of concentrating on attracting the customers to what the products had to offer or which of them he carried, he concentrated on how his customers felt about shopping in his store?" Henry asked, wondering if it was that simple.

"Exactly!" Frank said, smiling. "He knew that he would never be able to compete by only emphasizing his products and prices. But if he could establish a relationship with the customers, and make them feel good about where they bought their products, then they would want to come back."

Henry thought back to the frustration he had felt earlier. Had he been looking at things the wrong way?

"People want to buy from someone they feel is attentive and honest. They don't want to be just another order number on someone's books. They can get that feeling anywhere," Frank said, finishing the last of his drink.

"Hello there, Frank, how have you been?" Mr. Bob approached them with a smile.

After introducing Henry and talking for a few minutes, Frank mentioned that they should be getting back to the office.

"Frank, thank you for bringing Henry in. Oh, and Henry, if you'd like to join The Birthday Club before you leave, here's the form. Have a wonderful day gentlemen." Mr. Bob produced a short questionnaire from the deep pockets of his apron.

"Look forward to seeing you again, gentlemen." He waved as he walked away.

Henry smiled and began filling out the form. "Hey Frank, I'd like to pick up some "Thank You" cards before we head back, if that's okay with you."

In summary:

• Build a database: collect your customers' information
• Research shows that many customers buy personality, not product
• Get to know your customers by name and what they like to buy
• Do little things like birthday cards and thank yous instead of advertising
• People want to buy from someone they feel is attentive and honest
• Say thank you to customers who have referred new customers

Who is making money while you argue?

One of Mr. Bob's favorite stories focuses on the famous legal cartoon of two defendants arguing over the ownership of a cow.

Each is pulling at one end and the lawyer is milking the cow while they argue.

Now,

Are you fighting with your competitors over the acquisition of NEW customers?

This fight for new customers is usually attained by advertising and promotions.

Now ask yourself, who is milking your cow?

or better still

Who is making money while you argue?