Helping you get More Clients, More Sales and More Profits

Let’s imagine for a moment that you are a ruler of a country 500 years ago.

Let’s also imagine that your peaceful existence has been disturbed. You’ve just found out that your land has been invaded by barbarians. Knowing full well that talks are going to be pointless there is only one choice…you have to go to war.

So you summon your two most trusted generals and ask their advice. The first general tells you “You have to amass as many troops as possible. Give them the best weapons and go and fight the enemy directly. There’s no other way apart from a full on attack”.

You turn to the second general and ask him for his view…this is what he says.

“You need a plan. You need to work out a way to position your troops so that you can destroy the enemy effectively. Furthermore this plan must be such that the land is never vulnerable to attack an again”.

Which general’s advice would you choose?

In fact…Do you know the fundamental difference between the two generals?

General A is a TACTICIAN. General B is a STRATEGIST.

So what does this have to do with your business?

Everything!

In business terms a tactician is the person who believes that you need to work harder, hire more staff, make more phone calls, write more letters and advertise more. In a nutshell they believe that working harder at what you are already doing is going to be the keys to your success. They subscribe to the more is better philosophy.

A strategist is someone who believes that you need to work smarter. You need to plan how you are going to make sales and set goals. They also believe in hard work. But there has to be some greater purpose. They believe that you need to have an overall vision for where your company should be in 1,3,5,7,10 years from now.

If not, then why are you working so hard? Go back to being an employee and save yourself the hassles and heartaches that most small business owners have to deal with.

Every business needs both. A strategist is the planner but without a tactician to implement the plans the strategy (even if it’s brilliant) will go nowhere. On the other hand if you have a tactician who just believes in working harder with no plan or strategy. We’ll that’s no way to go either.

Which one are you?

Most people are either a strategist or a tactician. In large corporations that’s the difference between the executive (strategist) and the sales manager (tactician). It’s the difference between working on your business and in your business.

For most small business owners you’ll have to become both.

Ok enough theory. Let’s put this into practise.

A Service based industry

A strategist will ask “How Can we position/re-invent ourselves in the Market so that the customer think we are the only ones for the job?”

They may provide useful information to the customer. For example if you are a recruitment consultant you could write a report showing companies what qualities to look for in staff. Or they could hold a FREE mini workshop. On the flip side you could offer candidates FREE report giving them “10 Tips to Make Your CV Stand out from the Crowd”.

The tactician will be the one informing people of the service that you offer, make the phone calls offer the report. What you will do is set yourself up as the recognised authority in your potential clients mind.

Remember that you are helping the customer first. In their mind you have established yourself as an expert. Who do you think they will come to when it’s time to hire someone?

A product based industry

For example, if you are a furniture store. The strategist may decide that you want to give people the best buying experience that they’ve ever had. That way anytime they need furniture they will come to you FIRST.

You can achieve this by offering a report on how to buy the right Sofa, Table etc. for your home. It will explain the different types of wood, material used. How to clean and caring for the furniture? What shades go with what colour so you don’t have to spend a fortune re-decorating your home.

The tactician will implement these. They will be kind courteous to the customer. Not pressure them. Give them space. They will listen; I mean really listen to the customer.

Are you starting to get the picture?

Even if you don’t sell what they are looking for they will still come. You’ll have to literally push them away.

Do you know how I know this? It’s because I always go back to the same furniture shop FIRST when I want to buy furniture. Guess what? They are about 20% more expensive than most. It’s insane. But it works. And that’s what counts.

Distinguish Yourself From Your Competitors.

It just takes a little thought up-front to set you apart from your competitors. Reason being is that most small business owners don’t really take the time to do this stuff.

And that’s your opportunity!

As a business owner you need to be resourceful if you want to grow your client list. One of the most effective ways to get easy access to a volume of qualified customers is to set up joint venture partner agreements. Naturally you need to be selective about who you choose to work with as their conduct will reflect back on your business. But if you get it right it can be a very successful way to grow your business.

There are two ways in which you can set up a joint venture. One way is to link up with other businesses that regularly refer business to you. The second way is to use gifts and free offers from joint venture partners as a way of building relationships with your customers.

Creating an Irresistible Offer

If I were to come to your business and offer you a way to build customer loyalty without any cost to your business, would you take it? Of course you would. Most business owners would jump at such an opportunity. If it is something that you know your customers will love, that they will see as great value, the gesture of giving them a free gift can help you build better relationships with them.

For the business offering the gifts to their clients it’s a way of adding value to what they are already purchasing. For the business that has supplied the gifts, it gives them exposure to qualified customers that might otherwise not know about your business. The customers are happy because they are getting something for free and they feel important. Both businesses win because they are building relationships with clients and building their client lists.

For service based businesses this type of joint venture can work really well. For example if you have a consultancy, you can offer an obligation free session. Or you can offer a free training session. While it may take up some of your time, it is not really costing you anything materially. Remember that the objective is not to sell during these sessions. Instead it’s to offer customers something of real value.  Regardless of whether they buy from you or not they must walk away feeling that the experience was really worthwhile.

Rewarding Referrals from Joint Venture Partners

One way in which I get new customers is to offer a free marketing audit and I use joint ventures to help me promote this. For example I have a publication that I work with called Grapevine. They send out letters to their customers telling them about my free marketing audit. For any of their customers that take up the offer and become clients of mine, I pay them a referral commission. It’s a win-win for everyone. If the client chooses not to sign up they still got valuable information which they can use.  My joint venture partner has still added value to their client which helps improve their client relationships so they also win. If the client signs up they get a commission which has cost them very little to earn. I’ve gained a new client, and yes I’ve paid to acquire the client, but it’s a far better return on investment to pay a referral commission after you’ve got the client than to pay for advertising with an unknown return.

Joint ventures use business synergy to boost business growth. There are many ways in which you can apply this strategy to your business. The above are just two examples. Be on the lookout for joint venture opportunities, it’s a proven way to grow your business.

A key to finding successful gestures is to really get to know your clients. Find out what is important to them, what they enjoy spending time doing, or what they would love to do but feel is too extravagant. If you offer things that are specific to your client’s interests it shows that you care not only about the business they bring you, but also shows you genuinely care about them.

The type of thank you gestures you can offer to your clients may differ from business to business. Get creative and think outside the box. You want it to be something that your customers will appreciate so much that they will tell all their friends about it. Here are five great customer thank you ideas to get you started:

1)    Hire a Sports Car for a Day

One technique that I’ve been found to be very effective is to spoil my VIP clients and arrange the hire of a luxury sports car for a day as a reward. It works so well because it’s a real treat for the person driving the car, plus they tend to tell all their friends about it. It gets the word out about your business and offers an incentive to prospective new clients to sign up. After all who wouldn’t want to be able to drive around in a luxury sports car for a day?

2)    Give a Discount Voucher

For retail stores a good idea is to reward customers with discount vouchers. For example a clothing boutique could offer a bring-a-friend discount voucher. Reward existing customers when they bring a friend shopping with them. You can give both of them a discount voucher. This one is sure to go down well with the ladies as typically ladies love shopping together and they love getting a discount. You get more customers coming into your store and then friends about you when they leave with their new purchases.

3)    Give a Free Product or Service

If you have a service business you may be able to reward your customers without much outlay to your business. For example: A beauty salon could offer clients a free manicure or 30 minute back and neck massage if they refer 5 or 10 new clients. The chances are if they are regular clients they would recommend you in any event. But by rewarding your clients you take the relationship to a whole new level.

4)    Give away a Complimentary Voucher

There may be other businesses in the area that you can set up a joint venture with. A neighbourhood hair salon could offer a complimentary voucher for the nearby beauty salon for example. Or as a printer you could send your business clients a thank you note with a complimentary dinner voucher attached.

5)    Surprise your Clients with Treats

If you would like to reward your customers in a more informal way you could simply stop by with a delicious chocolate cake or pizzas for lunch. Often these spontaneous thank you gestures can be as effective as more formal reward programmes.

Remember that reward programmes help you to build your business, by building relationships with your customers. Money spent on rewards should not just be seen as an expense, it’s an investment in the future growth of your business.

Every business is unique and you may find that your customers respond differently to reward programs that you may offer. Sometimes a subtle approach to saying thank you is a better option for your business than a formal reward programme.

Low Key thank you gestures can be just as effective as formal reward programs. When gestures are subtle or more informal they often come across as being more genuine. For example if you know one of your customers is a coffee connoisseur you could keep an eye out for a particular brand or blend. When you find one you can keep it aside as a thank you gift. When there is an occasion to reward your client for referring business to you, a gift that reflects their personal interests will go a long way towards building good relationships. That type of gesture shows that you genuinely care and take an interest in your customers.

If your clients happen to be government departments or even a large corporate, overt thank you gestures can sometimes be frowned upon. Some organizations, in an effort to clamp down on corruption have strict policies against employees receiving gifts. So how can you still let your customers know you appreciate them without it coming across as a bribe? Here are some ideas that have proven to work:

Sweet Treats

Stop in at the local bakery and collect a batch of donuts, croissants or muffins. Then take them with you when you stop in to see your clients. Say something like, you passed the bakery on your way to see them and the goodies just looked too good to resist. In this way you can reward your clients and let them know that they are appreciated in a way that can’t be misinterpreted.

Handwritten Notes

These days it’s quite rare to get a handwritten note. Most people communicate solely on email. So when you take the time to write a short note expressing your appreciation to a customer it is sure to get noticed. It’s a gesture that shows your clients you appreciate them enough to take the time and effort to do so.

Calls to Celebrate

Use occasions to show your appreciation to customers. These needn’t be tied to specific referrals. You can use publically celebrated events as an excuse to reward your customers. Spring day, Valentine’s Day, Easter or Christmas. These are occasions where you can treat your clients with chocolates, flowers or biscuits and say you’re celebrating with them just because of the occasion. You could have personalised labels made for chocolates or order some special home baked treats. These are small gestures that your clients are sure to appreciate.

Keeping in Touch

Sometimes a simple phone call to customers is enough to show that you appreciate their business. Any small gesture that helps you build relationships with your customers will make them more inclined to send referrals your way.

Remember the purpose of thank you gestures is to make your clients feel important and appreciated. When you keep that as your focus you will find that there are many creative ways in which you can shower your customers with subtle thank you gestures.

When starting out with a rewards programme one of the most important things to keep in mind is the lifetime value of your customers. What did it cost you to acquire each customer? What are your customers’ worth to you? And what would you be willing to pay to gain two or three more customers for every one you have on your list?

Customer rewards programmes harness the power of word-of-mouth marketing. It’s one of the most effective ways to grow your business. How you choose to reward your existing customers can have a direct impact on the growth of your business. Let’s have a look at some of the numbers if you were to set up a VIP customer programme.

Why a VIP Club is a great Marketing Tool

If you create a VIP Club and just 20% of your customers sign up, you have the potential to grow your customer list by 40%. If every VIP club member refers just 2 new clients, these are the results you can achieve.  If 40% of your clients sign up for the VIP club and they each refer 2 people your business can grow by 80%.   If half your customers sign up you can actually double your business. That is how simple and effective a referral and reward programme can be.

Not many businesses are doing this, and this is why you can gain a competitive edge for your business by offering a rewards programme to your customers.  You need to consider your price points. What your average customer would spend with you, and what they would consider a worthwhile reward? You could give away some of your own products or services that have a high perceived value but that in reality don’t cost you much to deliver. As another alternative you could give away discount vouchers for both the existing customer and the person they’re referring. This entices both to come into your store to shop with you.

Creating Reward Levels

When deciding how many referrals per customer to reward, calculate the value in terms of profit that you would get from each. If you want to be generous in your rewards you may need to make the incentive for referring 4 or 5 new customers. For example refer 4 customers and get to drive a Porsche Boxster for a day. If you make a profit of £50 per person, that’s £200. Hiring a Porsche for a day as your customer reward, costs around £180. In this reward programme you would gain 4 new customers, be able to give a generous reward to your referring customer, and still make £20 profit. If you want to keep your rewards simpler like a discount voucher or bottle of champagne then you could reward every referral. Remember to build in enough profit so that the rewards don’t strain your cash flow.

The great thing about a reward programme is that it is a win-win for everyone. Your customers get rewarded for sending you new clients, and you get to grow your business in one of the most cost effective ways. If you set your incentives right, you can soon be doubling your business.

As with most things in business, if you don’t have the right motivations, then these reflect in your actions and can sabotage your efforts. Remember that while an increase in sales is a benefit that results from an active customer referral program, it should not be your primary objective. Your main objective should be building relationships with both new and existing customers.

What you need to look at is the lifetime value of a customer. Then consider how much it costs you to acquire each new customer. Advertising can be expensive, and even if you do your research, there are no guarantees that it will bring you more new customers. However, investing in an active customer referral program, if done properly, can deliver more guaranteed results. Here’s guide to avoiding common mistakes made by businesses when setting up referral programs:

Mistake 1 – Look at the reward cost as an expense rather than investment

If you make £200 from four new customers and then choose to spend £180 of that in rewarding the referring customer, there is the temptation to think that you are losing out on £180 worth of profit. You instead need to look at it from a perspective that you have gained four new customers and have still made £20 profit. Consider how much it would have cost you to acquire those four customers through other means. Adverts aren’t that cheap, and there is never any guarantee that they will work. You may get one new customer or maybe two. But you may also get none and then you still have to pay for the advert regardless. The bonus with an active customer referral program is that you only pay out the rewards after you have already gained the new customers. The reward is not a cost. It’s an investment that has already been realised.

Mistake 2 – Make your Pricing too cheap

You want to offer customers a fair deal, but don’t make your pricing margins so tight that offering rewards really squeezes your cash flow. You want to be able to be generous to your customers, so build in enough profit margins to be able to do so effectively.

Mistake 3 – Think you’re going to get the business anyway so why reward customers

A second common mistake is to think there’s no point in rewarding business that you already have in the bag. Remember though, that a customer referral program is about connecting with people and letting them know that they are important. If you have a long term contract with a customer and they refer lots of business on to you, then vouchers or an incentive may not appeal to them. But a special gift once every few months or so will let them know that you care and that they are important to you.  People will like to know they are appreciated. These small gestures don’t need to cost a fortune, but they will do a lot to help build your relationships with customers.

Active customer reward programmes are one of the most effective ways to grow your business. Being aware of these three common pitfalls, can help you to avoid them and create a more successful client loyalty programme.

When you set up formal reward programs essentially what you are doing is setting up a VIP club for your business. You are showing customers that they are important to your business and demonstrating this by giving them special rewards that are exclusive to them. Now some people are uncomfortable with this concept. They feel like they are bribing clients to give them referrals. But I can promise you your customers will love it. Remember that these are customers that are buying from you anyway. All you are doing is implementing a program that shows them how important they are to you by saying thank you.

Here are a few tips to help you set up a successful customer VIP club:

Create some Prestige

You want to create an air of prestige so give your customer referral programme a special name. Something like: The Ambassador’s Club; The Privilege Club; or the VIP Club.  Make sure that the name is something that makes clients feel important. The more important they feel, the more likely they are to actively participate in your customer referral and loyalty programme.

Play Open Cards

It’s very important in a customer referral program to be open and honest about the rewards you are offering existing customers for their referrals. Be sure to tell your customers to let any referrals know that they will also be benefitting. This protects your prospective new customers from feeling they are being misled or manipulated. This strategy also has added benefits. When new customers hear about the referral program it may get them thinking that they could also sign up to the VIP club and reap some of the benefits.

Choose your VIP Club Members carefully

Ultimately you only want clients in your VIP club that are absolutely delighted with your products and services. You want customers that really love you and buy from you regularly.  That way when they give client referrals it is a natural extension of their customer experience with you. In other words they are people that would naturally refer people on to you. The only difference is that now as members of the VIP club you are rewarding your loyal customers.

Remember that a client referral program is about rewarding your existing customers and building better relationships with them. If you do this properly referrals will seem like the most natural thing for clients. Your programs should not say: “Buy from me and I’ll give you this.” Instead it should say: “Use me, and as a thank you, you can benefit from these special privileges.” It’s all about using the right approach and building relationships with customers.

The thing with referrals is that people know that their reputation is also on the line. Most people won’t make a recommendation unless they know it’s a business, product or service that they can trust. If you have built a good relationship with your customers they know you won’t let them down if they refer people to you. This is what makes referrals so powerful. It is about building trust with prospects even before they come in to buy from you. It is one of the strongest ways you can build your business.

Let’s face it, there is limit to the amount of money a client would be prepared to spend with you over time. But there is no limit to the amount of referrals they can send to your business. This is why it’s important to set up an active client referral program and reward customers. Not just for buying from you, but also for referring new customers to you.

Many large supermarket chains and franchises have implemented loyalty programs where they give customers cash back. Customers swipe their loyalty cards and then receive a percentage of cash back in vouchers or credits over a period of time.  You can apply a similar principle in your business. But instead of rewarding customers for just spending with you, you also reward them for referring new business to you.

Ideas for creating Formal Rewards for your Customers

Be generous in your rewards. Make it something that will be really worthwhile and that will get people talking. For example: If a customer refers two new people to you, send them a bottle of champagne as a thank you. If someone refers four new customers to you, you could hire them a Porsche Boxster for the day. Now before you think that this idea is over the top and you’ll never be able to afford it, let me explain.

Let’s say that your profit per new customer is £50. For four new customers your profits would be £200. To hire a Porsche Boxster for a day costs approximately £180.  This means that after you’ve paid for the generous reward, you not only have four new customers, you still retain £20 of profit.

Now think how nice it would be to drive a Porsche Boxter for a day and how much your customers will talk about it. Chances are they will make a point of heading out on the town and wherever they go their friends and acquaintances will ask how they came to drive the Porsche. Each time they will tell people about your business and your reward program.  I can almost guarantee each person they tell will be thinking: “Maybe I should buy from that company and refer some people. It would be great to drive a Boxster for a day.”

Another idea for retailers is to give a discount for every client referral. For example: A clothing boutique could offer existing customers a £20 discount voucher for every customer referred. Plus the new customer being referred gets a £20 discount as well. It’s a win-win for everyone. It also provides an incentive for new referrals to refer other people to your shop. The more referrals they send you the more vouchers they earn. In the process you are building good relationships with your customers and at the same time growing your business.

Smart Marketing with Client Referrals

The idea behind giving formal rewards is that you are actually enrolling customers to be walking adverts for your business. Instead of paying for adverts, you’re rewarding customers for referring business to you. It’s a smarter way to spend your marketing budget and a great way to build stronger relationships with your customers.

It’s the small things that can make a big difference. Just letting customers know how much you appreciate them can make them more loyal to you. Remember that your client base is one of your business’ most valuable assets. Looking after your customers and building relationships with them is one of the best things you can do to grow your business.

In business one of the most effective forms of marketing is referrals and word of mouth. Yet few businesses have a deliberate strategy to use that as a marketing tool. The relationship that you have with your customers will determine the long term profitability of your business. So it makes sense to be more deliberate in building relationships with your customers.  You want to make them feel important.

Gestures that make Clients Feel Important

Take the time to get your customer’s contact details. Then after they have purchased from you follow up with a thank you note. You can send a quick email or text message, but to make even more of an impact send a hand written note. It’s so rare for people to receive paper letters or cards these days that your thank you note will certainly get their attention.

Make a point of keeping in touch with your customers. If they have purchased from you it’s likely they may be interested in information relating to your products or services. If there are any interesting developments within your industry, forward the information on to them with a personalized note attached. You can also create your own newsletters with relevant information that will be of interest to your clients.

Find out more about your customers, when their birthdays are for example. Then send them a birthday greeting that will reflect how important they are to you. You can also find out more about their business, and if you hear that they have landed a new contract you can send them a note of congratulations.

Why it’s Important to make Clients feel Important

Your customers have the potential to be the best advocates for your business. Their word of mouth referrals are ten times more powerful than any media advertising campaigns you’d invest in. When you create a special level of importance for your customers they become those advocates. These will be customers that love your products and services and use you a lot. Most importantly, they won’t be shy to tell everyone about your business.

The difference with investing in an active client referral program is that instead of taking these referrals for granted, you’re actually rewarding your customers for their word of mouth marketing. It is a simple way to boost their loyalty to your business. It doesn’t really matter if you choose to do this formally or informally. As long as you are making the effort to make your customers feel important. The free gifts, special offers and genuine gestures that you offer to your customers can be the best investment you make in marketing your business. Be deliberate in creating an active client referral program and you will be able to grow your business more successfully.

We teach our children to say thank you and I myself say thank you a lot.  And in business it’s really important to say thank you to your customers.  This is especially important for clients who refer you.  In many cases I heartily recommend a formal referral programme but this isn’t always appropriate for some businesses.  However rewarding clients who refer you is a great way to let people know that they are appreciated (and of course be more inclined to refer others to you).

Any reward or thank you offers you give to your customers are targeted at helping you build your relationships with them. Even small gestures like a simple thank you note, helps cement customer loyalty. The lifetime value of customers is one of your business’ greatest assets. In providing thank you offers you are securing that lifetime value, plus you are using it as leverage to help you grow your business further. Customers that know that their referrals are appreciated are far more likely to make more referrals to you. It simply raises the level at which you and your customers interact with one another.

How a simple Thank you got me a Large Contract

I once sent a thank you card to a client for putting me in touch with someone else. It didn’t generate any immediate business, but a few months down the line I got a call from the referral. They wanted me to do a presentation to their organization on how I could help start-up businesses, which were their clients, market themselves. In the end that lead generated £2500 worth of business for me. The thank you note had taken me only a few minutes to write and post off.  As this example illustrates, small gestures do work to help you grow your business. It may not be as direct as this example, but showing customers that they are appreciated definitely has an impact.

Today in business there is a great deal of indifference regarding customer appreciation. Customers are given a lot of attention up until the time they spend money, but after that there is little on-going connection.  Even if customers do return for repeat purchases, the attitude is usually: “Well they were going to buy anyway, so why should we spend money rewarding them?”

The Rewards of rewarding

By rewarding your customers you are really building a stronger business for yourself. Without your customers you wouldn’t have a business.  So it makes sense to look after them, build stronger relationships with them and reward them for sending more business your way. It’s a natural human tendency to associate with people and organizations where we know we are appreciated.  Saying thank you to your customers from time to time lets them know that you value them.

Think of it as treating your customers.  If you have a friend that is always there for you and goes the extra mile you won’t hesitate to go out and buy them a bunch of flowers or take them out to lunch to say thank you.  So do the same for your customers, it’s a great way to build relationships with them, and build your business.