What are you doing to proactively manage, protect and monetize your most valuable asset– your reputation?
The first R is reputation. As we discussed earlier, it has never been easier for potential customers to find out what others think about your business. This is both good and bad (depending on what people find).
As you know, nowadays people search online before they buy. We know that people put a lot of stock in what they find and read online. A recent Nielsen study shows that 74 percent of U.S. consumers choose to do business based on online feedback– even when it’s feedback from total strangers!
According to Nielsen’s summary of their poll data, recommendations from personal acquaintances and opinions posted by consumers online are “the most trusted forms of advertising.”.
Look who’s talking (about you).
A sample of who’s talking about your business:.
- Disgruntled employees.
- Ex spouses.
- Former business partners, investors.
- Trolls (the permanently aggrieved).
This probably isn’t anything new to you, and there’s a decent chance that, like most of the businesses I talk to, you are not very pleased about some of the things people have written about your business!
This brings up a larger point:.
Whether it is positive or negative in tone, most of the content about your business that is available online is not even being created by you anymore!
Consumers are critics and publishers now. They all carry tiny “printing presses” in their pockets!
Reputation: more important than ever.
To be sure, businesses have always relied on their reputation.
The stakes are even higher today because of how easy it is for consumers to find information about local companies before they buy.
What’s more, as we’ve already discussed, negative reviews can get lodged in the search results, hanging like an albatross around your neck and dragging down sales.
Are you “Googleable”? How many pages of Google are you on? (You may include Search, Maps, and Google Local citations in your answer).
Study: 90 percent of consumers online trust recommendations from people they know; seventy percent trust opinions of unknown users.
What are you doing to ensure that more people know about you today than yesterday?
The second R is reach. It’s my experience that a business that wants to grow needs to make sure that more people know about it today than did yesterday.
If you’re not meeting new people and telling them about your products and services, you’re not developing a pipeline of potential new customers and you are going to see fewer sales in the future as a result.
This sounds pretty obvious, I know. But I’m always surprised when I talk to local business owners and ask them about their promotional efforts.
When I look at the pipeline-filling activities of local businesses, I see mostly a scatter-shot approach.
A campaign here and there … with only a vague idea on whether they are getting a positive return on their investment.
No wonder so many businesses become skeptical of marketing:.
They’re doing it wrong!
Very rarely do I see coordinated, systematic and metrics-driven efforts to reach a wider audience and drive more prospects (i.e. people who are interested in what you’re selling) through the front door.
This kind of focused, ongoing and intentional approach is exactly what’s necessary to reach more qualified prospects in a cost-effective– not to mention satisfying!– manner.
A once-in-awhile, ad hoc marketing strategy is not going to get the results you need to achieve consistent business growth.
Do you have a method to build a continually growing prospect/client email list?
What are you doing to upsell, cross sell and repeat sell to maximize the lifetime value of your customer base?
The third R is resell. Once you’ve done all of the hard and often costly work of getting a customer, you need to make sure to maximize the lifetime value, or LTV, of that customer.
Whatever metaphor you want to use … mining your backyard … picking the low hanging fruit … the point is the same:.
It makes more sense (both financially and from an efficiency standpoint) to fully capitalize on your existing customer base than to be constantly on the hunt for new customers.
The more value you can generate from each customer, the less you have to spend on marketing, which means you can increase your profit margins and/or reinvest the savings into your products and services– in the process making your business even more attractive to your customers!
In practice, this can mean increasing the dollar value of each transaction or increasing the frequency that customers buy, either by offering add-on services or upsells or cross-sells.
McDonald’s offers the classic example: ‘Do you want fries with that?’ ‘Do you want to supersize your order?’.
These days there are so many cost effective and trackable ways to bring customers back to your business.
To give you just one example, consider SMS coupon campaigns. With monthly costs lower than $ 30 to send 1000 text messages, and average redemption rates of 20 percent or more, it potentially costs less than 30 cents per customer in your door!
Despite having easy access to new and cool tools, most business in our area are leaving money on the table because they’re not maximizing the resell potential of each customer.
Do you ethically (but effectively) prepare buyers from their very first purchasing experience with you to keep coming back to purchase over and over again?
What are you doing to use your successful relationships to create new, organic opportunities so that you can spend less and make more?
The fourth R is referral.
Since you’re doing such a great job taking care of your customers and keeping them happy, the next best thing you can do is set up systems to maximize the benefit you get from them? So that they are doing the marketing for you!
Well, it’s well known that if you just leave it up to people to do referrals for you, very few will– even if they are very happy with you.
You have to make it very easy– almost effortless– for your happy customers to refer your business if you really want to maximize the referrals you generate from them.
A study from Lee Resource Inc. found that attracting a new customer can cost five times as much as keeping an existing one.
Referrals make great customers.
We all want referrals because they help us save money on marketing?
Well, there’s even more to gain from referrals than cost savings:.
According to a case study noted in the Harvard Business Review, customers that come from referrals are, on average, about 18 percent more likely than others to stay with a company and they generate 16 percent more in profits!
And according to several case studies reported on by the website TechCrunch:.
Friends referred by friends make better customers.
They spend more (a 2x higher estimated lifetime value than customers from all other channels at One Kings Lane); convert better (75 percent higher conversion than renters from other marketing channels at Rent the Runway); and shop faster (they make their first purchase after joining twice as quickly than referrals from other channels at Trendyol).
Why are referrals so powerful?
Because they channel the power of social proof. Social proof is a fancy way of saying that we humans are easily influenced by each other.
We’re pack animals.
When a member of our pack (family) or tribe (social circle) recommends a product or service, we take that recommendation very seriously.
Similarly, when someone in a position of power, prestige or authority recommends something, we are very quick to act on that recommendation.
You see the applied power of social proof everywhere: in TV ads, when you see a celebrity endorsing a product; on the radio, when the person hosting the pledge drive tells listeners that so-and-so donated $ 50 to NPR; on the back of a novel you’re reading, when you see testimonials from other notable authors; and on the web, when you visit sites like Yelp.com to read consumer reviews of local restaurants.
Moving from passive to active, ad hoc to systematic.
Almost without fail, most businesses I talk to have no clear referral generation system.
They essentially think that referrals are something that you simply wait and hope for … but the reality is that referrals don’t just happen, you have to go out and get them!
And if you’re going to spend the time collecting them, you need a system that effectively channels your efforts into tangible results.
Get in touch today and we’ll discuss the process with you in more detail and provide a completely free price quote.
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