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Attract Customers With a Steady Stream of Customer Referrals…Starting Today!

September 30, 2011 Leave a Comment

More customers. Better customers? This is good, right?

Because most business owners I talk to are quite willing to offer a discount or have a sale to attract new customers.

But virtually none of them have any kind of system in place to get referrals. And some balk at the idea of offering an incentive for referrals…

None of which makes much sense when you think about it.

(Excepting professions where it’s not legal, of course.)

I mean, discounts are fine and sometimes a necessary evil, but you also risk attracting customers who are…

  • Going to balk at paying your normal rates next time around
  • Just hopping from bargain to bargain and provider to provider
  • The biggest pains to work with (bargain shoppers often are)

So discounts may provide a short-term infusion of cash, but they’re not the best strategy to get long-term customers.

On the other hand, referred customers are usually an all-round better quality customer. They tend to…

  • Spend more…now and over the long haul
  • Stay longer and become loyal customers
  • Be easier and faster to close–because they already have a degree of comfort and trust with you

In fact, a study in the Journal of Marketing earlier this year tracked the results of a bank’s incentive program for customer referrals–which gave referrers a $34 bonus–for 3 years.

And they found the referred customers were…

  • More profitable customers for up to 2 years
  • 18% more likely to stay with the bank over time AND
  • Generating lifetime customer values at least 16% higher

As a result, the bank was averaging a 60% return on their investment (the referral incentives).

I know–you’re not a bank. But the same principles still apply…investing a small amount to motivate people to send you quality customers will pay big dividends over time.

Go Beyond the Box for Customer Referrals

We tend to think of referrals as coming from customers, but in reality, the world is your referral oyster.

Everyone you meet can be a great source of prospective customers, JV partners and more. They just need to know who to refer and what to say.

Chuck Austin is long time sales pro turned consultant who’s become a referral master and has put together a product to help you do exactly that.

Ultimate Offline Referral Machine for customer referralsThe Ultimate Offline Referral Machine shows you how to network your way to a steady stream of customers without feeling like a beggar or a pest.

You’ll also discover…

  • 3 systems to tap everyone you meet for potential customers
  • What to say to more effectively ask for referrals
  • Different types of incentives and how to best use them
  • How to stay top of mind so they keep sending referrals in the months and years to come
  • Quick suggestions and wording on how to motivate current customers to refer others to you
  • And more!

Audios and worksheets are the core of the program, but there are overview guides, tips and a promotion example in PDF format as well. He’s also put together a site that will be updated with webinars and more materials over time.

After going through the copy he sent me, I think the Ultimate Offline Referral Machine is an amazing value–he’s going to be relaunching it for $47 in October. But you can get it for much less if you act fast…

So hop over to check out the 2-minute Ultimate Offline Referral Machine video he put together and get your copy now!

(Yes, affiliate links are included above. Feel free to go directly to the site if you have a problem with that.)

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How Can a Productivity Website Be Non-Productive?

August 23, 2011 1 Comment

A lot of people seem to think that when I do a sales page or website review, I only look on the actual words on the page. But nothing could be further from the truth

In fact, my Sales Copy Investigation page talks about how copy is just one of four key areas I look at–the other three being marketing strategy, offer and formatting–because ALL of these are critical to maximizing your sales.

So, yesterday I went to check out the a website for productivity products I read about in the Levenger catalog. (Love that store!) and I was a bit shocked–it definitely wasn’t their website that got the store’s attention.

Now, when you first land on the Action Method site, it doesn’t seem too bad. “Capture tasks, collaborate and get organized with Action Method” isn’t the most attention-getting headline in the world, but you do get the gist of what the site’s about.

website review action method productivity application

The “A suite of products, always in sync” subhead along with a big graphic image showing the app on a variety of devices tells you how they think they stand out from the crowd.

But is that much of a differentiator these days?

What’s the Strategy, Kenneth?

After all, a ton of task managers come in online and mobile versions. What IS different is they have paper products too–you’d be surprised how many people are sticking with or going back to good old pen and paper these days. But those aren’t included in the image.

There’s also nothing about how the purpose of the Action Method is to make everything a task and focus exclusively on tasks.

While it’s not good to get philosophical on your home page, right now, there’s nothing that explains what sets Action Method apart or why it might work for someone who’s failed at keeping up with other solutions before–which is very  likely with this type of application. (And yes, I speak from experience here. LOL)

The Method Behind the Madness

Scrolling down the home page, there’s an interactive graphic that shows you features of each format. But you still don’t get any sense of what the Action Method IS–how it works and how you can use it to simplify your task management.

website review screenshot 2 for action methodUnfortunately, that doesn’t improve as you go through the site.

I searched for a FAQ, which is buried in teeny type at the bottom under a lot of other gunk. Yes, gunk, because 95% of it has to do with the company’s other products and services and clicking the links takes you away from the Action Method site.

And what IS there about this product doesn’t inspire confidence. I perked up to see the fourth item about a 48-hour August sale in the News and Blog listing on the lift there. Too bad it’s from 2009.

website review screenshot 3 action method productivity application

Also, the FAQ takes you to a support area where two of the top three Tips & Tricks listed on the front page are “DOA?” and “Anyone still around?” Nice.

If you dig around for awhile, you’ll find a couple of pages on the company’s blog (not the product blog listed in the top navigation, another blog the company has) that talk about it. But again, they don’t really explain how it’s supposed to work in simple 1, 2, 3 terms–it’s more of a theoretical overview.

Make ‘Em an Offer They Can’t Find

The blue “Sign Up” button near the top of the home page takes you to a page that kind of asks you for your email and password.

I say “kind of” because there’s no call to action in text–just a couple of boxes with the words “email” and “password” inside of them. Which wouldn’t be so bad if the boxes weren’t black-on-black, blending right into the black page. If you just hit the big blue “Continue” button, then red bubbles pop up telling you those fields are required.

There’s also no mention of price. Is it free? That’s fine–just say that here.

But if you…

  • Go back to home page
  • Click on “Learn More” under the Online option
  • Click the “Get Started” button on the Online page
  • THEN you get a page that discusses pricing

Now, I have no problem with applications that charge a fee, but burying your pricing is NOT a smart thing to do. You’re going to get some unhappy folks who sign-up first and then find out they don’t get full access for free.

Last I checked, annoyed is never a good way to start a long-term relationship.

Your offer should be crystal clear with a strong call to action that not only tells them exactly what to do, but gives them a believable reason to act now–before they leave the page and never return.

In this case, just flat out telling them to give the free version a try would be a big improvement because then you could follow-up by email–reminding them to actually use it and upselling them to a paid account.

Wrapping Up…

In short, the Action Method site needs to work on all four key areas…

  • The strategy–especially regarding differentiation
  • The formatting–like clearing away all the gunk at the bottom and creating a sensible navigation
  • The offer–actually making a clear offer and giving them a reason to buy now
  • The copy–communicating all those things plus what the system actually IS in a more appealing, persuasive way to their audience

play buttonWant your own (much more in-depth!) website review? Sign up for a Sales Copy Investigation! Or find out how to make killer offers with the last day of introductory pricing on The Sales Supercharger!

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Marketing to Baby Boomers — Are You Missing Out?

April 5, 2011 Leave a Comment

eMarketer had a good article this morning about how many businesses are missing the boat when it comes to marketing to Baby Boomers.

Here’s the short story…

Baby Boomers spend more time and more money online than any other age group–between 36.5 hours and 39.3% hours per month, and spending$650 on average over a three-month period in 2010.  In comparison, Generation X internet users spent $581 and millennials spent $429.

They’re increasingly surfing the internet from their mobile phone  too–about 25% of them are mobile web friendly and that number is expected to soar to 40% by 2015.

  • If you’re marketing to consumers online and not paying attention to Boomers, you’re seriously missing out.

Boomers don’t mind being marketed to and have actually come to expect it. After all, they grew up “being chased by marketers and advertisers that tailored products and brands to appeal to them.” But now, they feel marketers have forgotten about them–as even the big Boomer-focused trend from a few years ago has fallen off. 

  • The bottom line–there’s a HUGE opportunity for those who are willing to target their products, services and marketing to them.  

BUT you have to be careful how you do it. “Boomers are immediately turned off by association with old age, infirmity and decline,” eMarketer says. So to “speak their language” and capture their attention, you need to turn these negatives into positives. 

  • For example, instead of talking about their fears of getting sick and frail, you stress the benefits  you offer that contribute to feeling healthy and strong. 

In short, if Boomers are part of your audience, finding ways to focus your products, servcies and markets on them could be very profitable for your business.

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What Advice for the Lovelorn Can Teach You About Pricing

October 8, 2010 Leave a Comment

I know this is a bit unorthodox…but here’s a snippet of an online  conversation I had with a self-employed friend about dating that perfectly illustrates a point most of us know all too well but still occasionally ignore…

Him: Is it true that the more a woman likes you the slower she is to respond to your messages?

Me: No, I’d say not true
Me: Who says that? One of those divorced ladies who wrote “the Rules”?

Him: Some writer named Jenni.

Me: Some girls will play those games
Me: But most will not unless a friend is sitting right there telling her she’ll look too eager if she replies right away

Him: Don’t know who to believe now.:)

Me: Yeah–me versus some dimwit who gives love advice on the internet*
Me: Who’s probably a guy pretending to be a girl

Him: She gets paid for it.

Aha! So on the one hand, he has an opinion from a friend–someone who is usually on the same page as him. Someone who’s fairly active in the dating scene and has a sense of the type of girl he’s looking for.

On the other, he has an opinion from someone he doesn’t know at all. She could be a total man-hater who sends guys scurrying away. She could be writing for a completely different audience–like teenagers.

And yes, she may not be a “she” (you’d be surprised how often men pretend to be women on Internet sites about dating!).

But none of that matters much because she’s being paid to give advice. (Although he’s not the one paying in this case.)

And in the end, whether it’s advice on dating, business strategy or basketweaving–people value something paid for much more than something free.

*Apologies to anyone who may happen to be an Internet love advice columnist! I’m referring to all those affiliate sites masquerading as expert dating advice where the articles are written by whoever was willing to accept $2 for an article that day.

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How to Get Customers to Spend More Part 2

August 24, 2010 3 Comments

Last week we talked about two of the psychological buying triggers mentioned in a Ladies Home Journal article on spending less that could be used to get your customers to spend more. Here are the three more tips they gave, along with how you can leverage the relevant buying trigger in your business.

Get Rid of Temptation
Well, we didn’t really need a magazine to tell us that an endless stream of emails and direct mail from your favorite companies intensifies your urge to splurge.

Or did we?

Because if anything, most business owners don’t mail or email their customers enough. The fear of becoming a pest seems to have reached epic proportions in the marketing world.

But there’s a reason why the saying “Out of sight, out of mind” has been around so long.

It’s awfully hard to “tempt” anyone into buying anything if you’re not communicating with them. Then when they do need something, they’re going to contact the first company that comes to mind–again, that’s not likely to be you if they don’t hear from you.

And with everyone’s inboxes flowing these days, they probably aren’t seeing every message you send anyway.

Still, you should mix it up by using more than one method of communication–such as email and direct mail. Not only will it keep them from getting tired of your messages, email and direct mail are proven to be more effective when used together.

Don’t Be Enticed By Free Trials

I can think of at least one book on my shelf that came from one of those “try it for 30 days and if you don’t like it, just send it back and you won’t owe a thing” offers. Or don’t send it back and they’ll just bill you for the book.

Offers like these have been popular for years because of what’s called “status quo bias”–people tend to stick with their current situation even when they don’t want it or its not in their best interest. (Thus, why most diets and other attempts to change habits fail!)

In other words, a whole lot of people never get around to sending the book back. (Like me in this case!)

But status quo bias can be a good thing for you, if you can create a monthly ongoing product or service and then give away free trials to get them started.

Don’t get me wrong–I’m against selling people things they don’t want. However, there have been times when I didn’t have time to try, say, a membership site during the free trial. But then continued emails from the site prompted me to start using it and I was quite happy I did sign up.

Note…ALWAYS make sure it’s clear they are signing up for a monthly service that will continue if they don’t cancel.

Know your Limits
Apparently, there may be a limit to the amount of self-control we can exert during a day. Once you reach your daily quota, you’re more likely to overspend.

University of Minnesota researchers found people who had to perform tasks involving self-control before shopping were more likely to make impulse buys and to spend more than those who didn’t. It’s that old “Well, I worked out this morning and ate healthy all day so I can afford the hot fudge sundae” reasoning.

And the self-control you exert does NOT have to be money related. So getting the salad instead of the burger you really wanted at lunch could cause a spending binge later.

What does this mean for you? Next time you’re scheduled to speak to a group, brainstorm some creative ways to incorporate exercises involving self-restraint into your presentation. (Or make sure yummy desserts are offered!)

Another way to leverage this is to make down-sell offers to people leaving your sales pages. Because people who are interested but didn’t buy will feel they’ve earned the right to buy a less expensive alternative that also meets their needs.

And if you missed last weeks’ tips on putting psychological buying triggers to work for you–Keep Your Hands to Yourself and Pretend You’re the Lone Customer–check them out for more sales-boosting ideas.

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How to Get Customers to Spend More…Courtesy of Ladies Home Journal

August 20, 2010 Leave a Comment

I was waiting in the doctor’s office to get my broken foot checked recently when a cover line on Ladies Home Journal caught my eye–”Save More Money Without Even Trying.”

(By the way, cover lines–the one-liners on the front of a magazine–are great places to get headline ideas because magazines rely on them to sell store copies–which are usually more profitable than subscriptions.)

The article itself, “Why You Spend More Than You Think,” talks about psychological triggers that encourage people to buy in an effort to help readers cut their spending. But I’ve taken some of their tips and turned them around to show you how you can use these triggers to help you increase your sales…

Keep Your Hands to Yourself
The longer you hold a product, the more you’ll want to buy it. Even if it’s just for a few fleeting seconds, having the product in your hands makes you start feeling like it’s already yours.

That’s why car salesman are so eager for you to take a test drive…Let’s face it, for the vast majority of people, the way the car handles isn’t going to make or break the buying decision. mind.

But when you get behind the wheel, you start seeing yourself driving it to work, running over to the kids’ school or cruising along to the beach. It starts feeling like it’s yours, which makes it a lot harder to walk away and leave the car on the lot.

If you’re selling a service, this isn’t quite as easy to do. Yet two ways you can use this to your advantage are…

  • Giving prospects a sample of your service–again, it helps them see more concretely how it will help them and how they’ll benefit if they keep using it
  • Including details and powerful words in your copy to help them experience how they’ll look, feel and be after using your service

Pretend You’re the Lone Customer
Customers are more likely to choose a pricey brand over a cheaper one if other shoppers are nearby because they’re concerned what the other shoppers will think if they go for the cheaper one.

Yeah, this sounds a bit vain, and I know, you’re not like that. But remember these are common triggers–that does not mean they apply to everyone. The question is do they apply to your audience?

Regardless, this is a great strategy to consider when you’re selling at a live event. People will naturally talk to others when they’re waiting to turn in their order form or with other attendees afterward–and some do want the bragging rights of saying they’re getting the best, most exclusive option you offer.

So make them happy and be sure to offer several packages at different price points, including a VIP level option they’ll be excited to tell everyone about.

Since this is getting long, I’ll save the last three strategies for Part 2 of How to Get Customers to Spend More, which will be posted next Tuesday!

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Pricing Strategies for Your Services Wrap-Up

May 18, 2010 1 Comment

In this series about hourly rates and pricing strategies for freelancers or small businesses, we’ve looked at:

 

9 Reasons to Stop Charging Hourly Rates

4 Reasons Why Hourly Rates are Bad for Clients Too

Charge What You Deserve–Project Fees & Flat Fees

Packaging Your Services

Should You Be Paid for Performance?

 

But now you may be wondering…Are hourly rates ever a good idea?

The answer is yes—hourly rates can be a good approach when there are too many unknowns about a project.  For example, if the prospect is being very vague or you haven’t done anything similar before.

In cases like that, where the time required and/or extra expenses you’ll incur are far too difficult to predict, charging an hourly rate may be the safest approach for you.

But most of the time, you’ll find it much easier and more profitable to use one of the other pricing strategies above.

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Pricing Strategies — Performance Pay and Retainers

May 17, 2010 Leave a Comment

There are two final alternative to charging hourly rates–performance pay and retainers. Like the name implies, performance pay means a good chunk of your income is based on the results you achieve–whether it’s called a commission, royalty or some other name.

In theory, it’s a great idea—the more the client benefits from your work, the more you make. But it’s much more complex than project fees or package pricing.

Pros of the Performance Pay Approach

  • Earning far more than you would have made with a flat fee if your work hits a home run for the client
  • Signing on clients who may not otherwise be able to afford you
  • Definitely getting results you can use for future testimonials (since it can be so hard to get them otherwise)

Cons

  • Possibly doing a lot of work for very little money if the project bombs
  • Others killing your results because they’re not doing what they’re supposed to do (unless you have full control of the project)
  • Relying on the client to compensate you accurately unless you have direct access to the results
  • Getting a smaller upfront payment than with a flat fee arrangement
  • Estimating is exponentially more difficult, since you’re trying to predict earning potential

In my opinion, the cons of the performance pay approach far outweigh the pros unless you’re working with someone who has a proven track record (although no one is failure-proof) and who you’d trust with your first born. Of course, it’s still smart to “trust, but verify” as they say.

Retainers are arrangements where a client pays you a set amount every month for specific services.

Pros of the Retainer Approach:

  • Receiving steady income throughout the year
  • Getting paid whether or not the client uses you
  • Becoming more of an advisor to the client, instead of “just” a writer/designer/coach or whatnot
  • Having little to no learning curve with the projects each month, so they should take less time than the same project with a new client
  • No surprises at invoice time since both of you know how much they’ll be paying from the start
  • No estimating, once the initial contract terms are set

Cons:

  • Clients who feel entitled to all of your time and/or expect you to jump the moment they need you
  • Some clients will demand detailed records of your time spent
  • Having to “eat” the extra hours if you underestimate the time it’ll take for all included projects
  • Needing to sharpen your skills at defining the scope of the project so it’s crystal clear what is and isn’t included and you avoid the sting of “scope creep”
  • Renegotiating the contract terms ( and your compensation) every year
  • Being “locked in” to working with that client may be a problem if you suddenly need extended time off or decide to move your business in a different direction

Personally, I’ve always felt the cons outweigh the benefits of the retainer approach because you’re essentially at the client’s beck and call…making it hard to plan your time and putting you at risk of doing more work than you originally expected.

However, it can work in a situation where you’re doing the same exact projects month after month…and you’re good about drawing the boundaries when necessary.

Finally, we’ll look at whether hourly rates are ever a good idea.

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Pricing Strategies — Service Packages for More Income

May 13, 2010 Leave a Comment

package rates for self-employed

Service packages take the flat fee pricing strategy a little further and up the perceived value by combining your service with other relevant services and/or products–usually for a bit of a discount.

Packages also allow you to give prospects several options to choose from instead of just one–which means they’re much more likely to buy because you’ve doubled or tripled the odds of finding one that suits their budget.

Pros of the Service Packages Approach
  • Earning more revenue per client, as they pay more than they would have for just the service
  • Little to no learning curve with the additional projects in the package, so they should take less time than the same project with a new client
  • You become more of an advisor to them, instead of “just” a writer/designer/coach or whatnot
  • No debate over minutia like number of hours or hourly rate—just one total number, which is all they ultimately care about anyway
  • They’ll get better results by having more of a total solution to their problem, and be more likely to hire you again and recommend you to others
  • Potential to set you apart from your competitors, who offer piecemeal solutions
  • No surprises at invoice time since both of you know how much they’ll be paying from the start
  • If you spend too much time on one project in the package, you may be able to make up for it by spending less on another
  • Estimating becomes much faster and easier, especially if you develop a rate sheet for frequent projects
Cons
  • It’ll take a little more time initially to develop your packages
  • You’ll end up “eating” the extra hours if you underestimate the time it’ll take for all included projects
  • You may need to sharpen your skills at defining the scope of the project to make it crystal clear what is and isn’t included, so you avoid the sting of “scope creep”

So what should you include in your packages? Consider any add-on product or service that complements what they’re hiring you for. Especially ones that won’t take much of your time– such as an information product, critiques, access to calls you’re doing anyway and email access to you (which most will rarely take advantage of).

All of these can significantly boost the value of the package to your client without chaining you to your desk for more work.

Another tip…only offer two or three packages per service–any more than that will make them procrastinate about buying. And if you create three options, be sure to put the option you want most people to buy in the middle, because that’s the one prospects naturally gravitate toward.

Now that we’ve discussed service packages as a pricing strategy, we’ll cover two more ways to escape the dollars-for-hours noose.

Photo was taken by MarcinMoga/Lolek and posted on Flickr under a Creative Commons Attribution 2.0 Generic license.

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Pricing Strategies — Flat Fees & Project Fees

May 12, 2010 Leave a Comment

project hours, like a house under constructionPreviously, we talked about the pitfalls of hourly rates for freelancers and self-employed professionals and why your clients should hate hourly rates as well.  Now let’s talk about a popular alternative…the flat fee or project fee.

But first, I want you to think about this…If you buy a home in a new development, is the builder quoting you a price based on the hours everyone spent working on that home, plus the materials–or is he quoting a price based on what other similar homes in that area are worth?

Of course, he’s going to go with the latter  because it should cover all of his labor and other expenses and still allow him to make a profit. (Although that point may be debatable in the current real estate market!) So essentially, what he’s charging is a project fee–one price that covers the whole shebang.

You can use the same concept for pricing your services as well. And it’s a fairly simple pricing structure to transition to. If you don’t know what the true value of your services are (industry pricing guides can be quite helpful in this regard), you can start by just estimating the hours it’ll take and calculating the fee based on your hourly rate.

But then, you should add on to that “base” number to cover any expenses you expect to incur as well as premiums for rush jobs or what I call “the PITA factor”—when you suspect a client will be super high maintenance. In the end, you add it all up and present one total price to the prospect.

Pros of the Flat Fee Approach
  • No debate over minutia like the number of hours it takes or your hourly rate—just one total number, which is all they ultimately care about anyway
  • The potential to net more per hour if a project takes less time than you expected (which encourages you to be more efficient)
  • No surprises at invoice time since both of you know how much they’ll be paying from the start
  • You can adjust the project scope before you start the work if the client feels the total is too expensive
  • The price for the fifth time is the same as the first, because they’re not thinking in terms of the hours it’ll take
  • You never need to have that oh-so-fun “I’m raising my rates” conversation with current clients, simply increase the project price the next time they hire you
  • Estimating becomes much faster and easier…especially if you develop a rate sheet for frequent projects
Cons
  • You’ll end up “eating” the extra hours if you end up spending a lot more time than you expected
  • You need to define the scope of the project ahead of time to make sure it’s crystal clear what is and isn’t included, so you avoid the sting of “scope creep”
  • Occasionally, the total cost will be such a surprise they decide not to work with you. But isn’t that better than doing all that work only to have them balk at paying the full amount in the end?

Note that while you won’t be required now to track your time, you should still do so to see how close or off your estimate is and help you refine your prices for the future.

In short, if you’re still stuck trading hours for dollars like a car mechanic, moving to project fees may be the easiest first step toward getting paid based on the value of what you do–rather than the number of hours you work.

Next up is a pricing strategy that takes project fees to the next level and gives prospects more options to say “yes” to.

Photo taken by Brock Builders and posted on Flickr under a Creative Commons Attribution 2.0 Generic license.

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