Setting Up A Referral Marketing System
How many of your current customers have been referred to you by another happy customer? How many new customers can you depend on getting from word of mouth each month? Don’t know? Well, it’s okay. That just makes you normal.
Chance Marketing
Most lawn care operators are in the same boat. They use Chance Marketing – that is, just wait for chance to happen and referrals will somehow come along on their own. Can you afford to leave your business’ growth to chance? Not in today’s economy.
Do You Have Customers Or Do You Have Evangelists?
Of all the tools in your marketing tool bag, “word of mouth” or referral marketing is by far the most effective. When your satisfied customers tell their friends and neighbors about you, they aren’t advertising, they are evangelizing! They believe in you and their word is worth more to that potential customer than 10 or 15 exposures to your marketing message. How can you beat that?
Consistent Referral Results
If you don’t have a system in place to consistently, relentlessly get referral business from your satisfied customers, you are leaving a lot of money on the table. How much? I’d say at least $475 per customer per year. If your average account is $45 per service (conservative) and your average season yields 35 service visits, then your average customer is worth $1575 per season. If you use a 30% response rate on a fine-tuned referral system, that amounts to $475 additional income per customer per season. If you have 20 customers that amounts to $9500 you’re leaving on the table every year. If you target higher end customers and learn the art of upselling of course, your loss is even greater.
Your Referral Garden
Your customers are a garden and you have to cultivate the referrals. This means develop a system or systems to encourage them to share your name with their friends and neighbors. Referrals don’t just happen with enough consistency to depend on.
The Answer Then Is A System
- system
- Noun
- 1. a method or set of methods for doing or organizing something
If you want consistent, predictable results from your referral marketing, you need to have in place a system that works day in and day out. There are as many ways to implement a referral marketing system as there are creative marketers. The key, however, is to know your customer. Think like they think, and you’ll be able to develop a program that will pull consistent results.
One Quick Example
Need a little help to get started? How about this. Create a “New Customer Offer” such as a free 21 point lawn inspection, or free first fertilization application, or whatever your ideal customer would value. Print your offer on a sheet of business card stock (most word processor programs have templates for 8 or 10 business cards to a page, or search for free downloadable templates) along with your satisfied customer’s name. For example, one entire sheet of business cards would look like this:
First Fertilization Application
Provided Compliments of
Mr and Mrs Smith
Call 555-5555
So, you see. You give this stack of 10 cards to your customer, Mr Smith with instructions to pass them on to his neighbors and friends. In return, for every referral call you get, he gets a credit towards one free service. If you get a new customer as a result of his referral you’ll give him a $50 gift card to Long Horn Steak House or something.
So your cost is about 80 cents per sheet of business cards plus the value of the service provided to your new customer plus a gift card to your current customer. So for about $80.00 in hard costs, you get a new customer worth $1575 each season. More if you master the upsell. If you get no referrals, you are only out 80 cents for the stack of business cards.
The Power Of Referral Marketing
If you need help coming up with ideas or just want some concrete advice about how to use referral marketing to its maximum potential, check out this ebook from Vince Golder. It’s well worth the investment.
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