This weekend a colleague asked a myself and a few fellow business owners if our customers were asking for discounts after work was complete. His customers were telling him they could pay him immediately if he took another 20% off the bill or he would need to wait for payment. This is for work he already had done!! With the recession he added that his closure rates on bids went from 50% to under 10% and he was desperate. He is in a competitive, commodity market, but something isn’t right here. He is taking the 20% off the bills and discounting, but his business is not doing well. You could see the worry on his face and I am sure the customers are as well.

I suggest if customers are asking for discounts that you change the scope and give options. Give three different scopes of work with three different price points, but then hold firm on the work being done. You must do this to stay healthy and your customers should respect this. People love options and the customer will understand that with options there are varying levels of product.

There are typically three things to look at with any project scope; price, timeframe, and quality. Keep to these three sides of the triangle when bidding and discussing jobs with customers.

Before finding yourself in an unprofitable situation, the best businesses find ways to differentiate themselves and offer unique and special services and products. Customers will be happy and your business will remain healthy.

Many associations conduct their own membership loyalty surveys and exit surveys, manage their own member satisfaction metrics and research studies.  Sometimes the response rates are low and difficult to understand why.  Here are a few things to consider when  running a survey or research study.

1)Keep surveys as short as possible and know your audience. 

2)Know both their appetite for the kind of survey you are doing and also how strong your relationship is with them.

3)Look at your e-mail invitation to the survey.  Messaging is so important to grab attention.

4)Look at the words used. You may be getting caught in spam and it isn’t being delivered.

5)Look at the subject line to make sure it is enticing and connects with the responder.

Most of the time you should only need to remind once and then you become an annoyance.  If you need to go with multiple reminders then something is going on.

Yesterday I was speaking with a good friend who was heading home for an appointment with his oil burner maintenance company.    Since I needed some maintenance I asked how he liked the business.  He said he “HAD” to use them because the business was a client.  He continued saying that he just wished he could go elsewhere and  explained all the problems he had over the years.  He felt hostage.  I call  this “Fake Loyalty”.  It is too bad this oil burner company doesn’t get it right and give this customer a reason to refer them.  I am just glad this guy told me to stay away.  Does anyone know a good oil burner guy?

Ask your customers the question “How likely are you to recommend us to family and friends?” Some of your customers may feel like hostages for now.  Why not make it right.

Leveraging customer testimonials is a great way to improve your marketing approach. Most businesses do not do this effectively or don’t make it part of their overall marketing strategy. It is very easy to collect testimonials.

The easiest way to get testimonials is through a paper or e-surveying process either done annually to all customers or individually after jobs are completed. In the survey add the question “Is there anything you think we do particularly well or anyone you want to recognize?” You will quickly get dozens of testimonials to use. All you need to do is immediately send back the comments to the customer asking their permission to use in marketing.

99% of the time they will say “sure” and now you have your dozens of testimonials. Another way is to add an approval box after the question asking their permission to use any comments in your marketing efforts. Any checked off are fair game to use and you have documentation that they gave the OK to use it. Good luck!

The fastest way to grow your business is by selling more to existing customers or clients. Studies by several large corporations have shown that it takes up to 10 times more effort, marketing and selling, to obtain a new customer versus selling more to existing customers. It is only logical: less barriers to entry, your knowledge of key decision makers, their knowledge of your business, ease of getting meetings, comfort to ask pointed questions, ease of getting introductions to others, ease of showing new products and services. The list of obvious advantages goes on and on.

Then why don’t more businesses create a usage or buy matrix for their existing customer base? Because it takes time, sometimes systems don’t support easy reporting, and as business owners or corporate executives, sometimes we value slaying the dragon(competition) or closing a brand new customer much more than cultivating and selling to existing customers. Even sales managers put a bigger bogie or bonus on slaying another dragon or promoting a “hunter” philosophy rather than just driving client share or what sales people call “farming”. Hunters are more valued and rightly so when growing a business where it is tough to get into new accounts or markets. However, sometimes we spend way too much time hunting and many times let our competition bite at our heels, taking the business we should get but don’t, because of our passive nature of staying at the same product or service mix sold into the account.

Take the time to create an excel sheet if that is all you have. Put along the top of the excel sheet all the products and services you can sell to your customers; a product or service per column heading. Along the right side in the first column list all your clients or customers. Put a check mark under any product or service they are currently buying from you. Now you have a roadmap for conversations to discover with your customers what else they may need. Small businesses can do this by working with an intern or getting help from office personnel. Larger corporations should set up systems to pull this from their order fulfillment reporting.

We must all keep an eye on this tremendous customer intelligence to get to the next level of sales and serve our customers to the fullest. If there is a need and we feel confident we can fulfill that need, then we should pursue it with every customer.

In January 2009, 205 independent quick printers shared their thoughts on the question “Where do you think the top growth opportunities are in 2009?” Digital printing is on the minds of 82% of quick printers. The ability to make short runs quickly, managing staffing levels, and training time are key drivers of this investment. After that quick printers see mailing services (56%) and large format (28%) as the next most important to growing their business. Marketing services, web design, promotion products were all in the low 20′s or teens in the percentage seeing these areas as growth areas.

It is amazing how many quick printer customers still don’t view their printer as a mailing house or someone who can do large format. As an example, in a recent print buyer study we asked the awareness question for these services. We surveyed the customer base of a quick printer asking thier customers about awareness of each product and service. Only 25% of their customers were aware they offered bulk mail and 70% large format. The interesting thing was that many customers stressed their interest in learning more.

You can’t assume that customers will remember you just by mailing a few flyers and mentioning it a few times. Get creative on your messaging. Becoming a marketing service provider starts under your roof. Launch that new service this year and measure awareness as you go. A good goal to shot for is over 90% awareness.

The difference between customers “Likely” to recommend and those “Very Likely” to recommend is much wider than you think. Let’s look at how a conversation could go between a prospective print buyer who is asking one of your customers for help choosing a printer.

As an owner and sales person I would feel just great with my customer’s performance! That performance is a direct result of your performance. The quality work and service you provide makes it easy for them to feel confident in you helping their friend.

As an owner or someone is sales I wouldn’t be too thrilled with my customer’s enthusiasm here. The prospect is probably thinking he may consider ABC Printer, but it definitely isn’t a homerun and he probably should just keep asking other friends.

ABC Printers is not flattered to say the least! Now it can get really ugly from here. No one has customers feeling the way this next person feels. Only kidding, we all make mistakes.

Ugh! This is what brings a business to the brink. We don’t need to many of these characters running around spreading doom and gloom. What was that commercial “Don’t let this happen to you.”

Now let’s get back on the bright side of life.

Keep your employees focused on “WOWing” customers and keep all employees accountable for driving the customers to jump on the chance to refer you. Give them the opportunity to brag about their great decision to work with you. If someone is “Likely” to recommend you, find out what it will take to get to “Very Likely”.

It is amazing how many customers will give you a false sense of security by saying “Likely”. Some customers will say “I never give anyone the best ratings.” I totally disagree with this and any time you probe and dig deeper you will find that they do recommend other suppliers who are “WOWing” them.

Your “Very Likely” customers are most likely to take full advantage of a referral program, drive prospects through your doors so you don’t need to spend big advertising and marketing dollars, and they will help you stay profitable. Creating more “Very Likely” customers will maintain that stability in your business. Rally and promote to your team to focus on the customer no matter where they are in the organization. Everyone is in customer service and their goal should be to delight customers.

Focus on keeping a high percentage of your customers in the “Very Likely” to recommend bucket.

The little things tick people off at marinas; cold showers, no toilet paper in bathrooms, not enough launches on race night, puddles near the electrical connections.   When it comes to boatyard service the frustrations include dirty boots climbing deck during commissioning, greasy hands on masts, rude ill trained seasonal help. 

The surest way to keep customers is to keep the pulse of your operation and react quickly.  Understand how you are performing on a regular basis.  Don’t wait to find out the showers were cold a week after the heater went on the blink.  Yes, you would think a customer would walk in and tell you, but don’t assume.  Make it easy for customers to give you feedback.  Feedback cards and boxes in convenient places, online surveys on kiosks or emailed to customers after a stay or boatyard service, phone survey followup for larger jobs or high end operations. 

The best way to keep your operation profitable is through referrals.  By building an army of those “Very Likely” to recommend you, there is no reason to have a huge marketing budget, put big advertisements in cruising guides, or buy google ad words.  People in boating love to talk about experiences.  Their boating or yacht club gathers are your greatest marketing opportunities and it’s free!  You much rather have the member bragging about their recent decision by saying,  ”Boy, marina xyz was the best I have been to.    A true 5 star. Thier customer service was unbelievable and they …..  The facilities were incredible and they had……..  The most outstanding thing was……

The flip side could be “Never go to XYZ marina.  The bathrooms were always out of toilet paper, I had to …  The showers were cold at 6AM causing me to …..  I had to wait 20 minutes for the obnoxious kid on the gas dock to……

Remember, your best source of referrals and repeat business is to make experiences memorable in a good way.  Give them a reason to brag about their great choice when sipping wine with their boating friends.  The only way to make this happen is to keep the pulse of your operation through the eyes of your boating customers.

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A few years back a great book was published, The Ultimate Question by Fred Reichheld. He explains how several well known leaders in their industries leverage customer loyalty to drive profitability. It makes so much sense. If customers love your product and feel unique and special, they will recommend you.

Think about your marketing budget. What if you could get rid of the budget because prospects keep knocking on your doors? Enterprise Rent-a-car™ is praised in their industry for profitability and embracing the concept of customer loyalty. It is no surprise they have become the #1 rental business in the world.  Their advertising budget is a fraction of their competitors’.

What does this have to do with the printing industry? The best run printers have lower marketing budgets and leverage referral programs to keep customer’s promoting. This doesn’t happen overnight, but is part of their long term strategy.   ABC Printers tracks performance, reads customer comments daily, sets up teams to correct problems, engages the customer with this first hand feedback, sets up referral programs, and promotes customer loyalty.   They know when loyalty is dropping, and more importantly they address the issues immediately.  The operation remains customer focused and it pays off.  

We changed the name of the real printer to ABC Printers to protect identify.

How do you know if your customers are promoting you? The best way is measuring sources of incoming business. Recently one printer measured that 17% of their customers came from referrals while another was over 40%. What a difference. What a great way to save marketing dollars by having prospects knocking on your door. It is not surprising that the printer with 40% is growing during the recession while the 17% printer is hanging on.

How do you measure the customer referral factor in your business? There are two ways. First, any good CRM (Customer Relationship Management) system has fields to flag the source of new customers. Measure both internal referrals within your larger shared accounts and external referrals or new business relationships. Second, printers should ask after orders are delivered if the customer will recommend you to colleagues and friends. Do this on a continual basis, but respect your high volume customers. Surveying once a month is acceptable if the survey is short and done professionally. Only the highest ratings should be considered promoters of your business. Based on our print buyer surveying the average printer receives an 82%. This means that 82% of their customers are very likely to recommend. The best printers are above 90% and the lower tier is just north of 70%. The fascinating thing about the concept of creating raving fans or delighted customers is that major corporations such as Enterprise Rent-a-car, Southwest Airlines, and Intuit continue to grow profitably by viewing the long term value of a customer and measuring their referral scores.

In the printing industry we offer printers a program, CustomerPulse, which calculates the industry referral index on a monthly basis.  Frankly the bar is higher for the printing industry than just about any industry out there.  The ability to move to another printer is easy in many instances and most print buyers already buy from multiple printers.  Also, the Business to Business dynamic needs to be taken into account.

Be truthful with yourself when measuring customer loyalty or tendency for customers to refer you.  One printer shared that their score was over 90%, but it was based on 50 surveys a month out of the 4,000 individual businesses buying from them monthly.

Start measuring referral sources and measure your customer loyalty and referral index on a continual basis.  It will help your long term profitability.