Keeping Customers

December 6, 2004

By: Adams Hudson

It always amazes me. Did a seminar last week for about 90 contractors ranging from 5 employees to 120. Years in business from 3 to 85. Went through a discussion on THE most important thing in any business.

I'll go ahead and blow the punch line by telling you the answer is... Paying Customers. Before you dismiss this as so obvious that it's not worth the ink or the electrons it took to write it, my next question was: "So how many of you have a Customer Retention program?" A few hands go up. Would yours?

If paying customers are the object of this "game" we call business, then KEEPING these customers would be even more important than getting new ones. Why?

Who buys faster: existing customers or first time callers? Who pays more? Who refers more? Who more readily buys the upsell? Who more likely buys the Maintenance Agreement? Who price shops less often?

Since it's my job to "illuminate deficiencies" (which is nicer than saying "to make you feel inadequate") you'll be shocked to find out...

Top 3 Reasons Contractors Don't Have A Customer Retention Program

1. "It's too hard."
If it were easy, every dufus you call a competitor would have one. Same with all the other stuff you do that makes you better. Easy solution: We publish newsletters for hundreds of contractors. (If you don't like ours, I'll recommend another publisher.) We sent out free samples all spring. All you ever need to do is tell us how many. Is that hard?

2. "I don't know how to mail them."
DO NOT try to save money by labeling and stamping more than 1500 in-house. Big waste. Let a mail house (or us) do this to achieve maximum speed and discounts. Get 'em gone!

3. "I don't have a mailing list."
This is bad. If you've ever gotten one phone call or sold one thing, ever, then you have a customer list! Would you sell customer info after each sale for $100 cash to a competitor? Most of you say, "No way." If not, then what do you plan to do with this name if not compile it for future value?

Big Lesson of the Day
Your customer list is the Most Important Single Thing in your business. Period. Extracting value from it is the most important business mission. If you lose 1/1000th of your customers (just 5 of 5,000!) who buy a big-ticket item from a competitor, how much did that cost you? It cost a LOT more than having a Customer Retention program, I promise. Keep the list and the customers.

Many contractors tell me, "Some callers only want the price over the phone. Since we're not the cheapest, I usually don't hear back from them again." Forget being the cheapest, try these out...

1. "Well, you'd probably like to save some money on energy bills, right?" If "Yes", "This system will be working almost non-stop for the next 10 years or so, so these savings can be huge and seeing your home is the most important factor. The survey is free, and there's no obligation."

2. "I need to come appraise your old system first to see how much to give you on a trade-in." (Usually is the amount of your discount.) This response gets about 90% appointments.

3. Ask semi-technical questions. "What is the approximate cooling loss? Is your ductwork sealed? What would be the cubic volume of your home?" Any questions that are responded "I don't know", simply tell the customer, "If I gave you a quote now, it might include more than you need. I'll gladly come take a look so you won't over buy."

Sounds like you don't need any more help getting appointments! Let us help your business grow!

Now go out there and sell something!

Adams Hudson is president of Hudson, Ink “Creative Marketing that Works.” His company creates a full line of marketing tools for contractors including Customer Retention newsletters, Yellow Page ads, “turn-key” Marketing PowerPacks and custom copywriting. You can get a free subscription to his “Sales & Marketing Insider” by faxing your letterhead to 334-262-1115 with the request. Also check out on the web for free marketing tips or call 1-800-489-9099 for more info.

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