The Magic Of Retention

magic-of-customer-retention (Why an existing customer is way better than a new one)

I’d bet you a lifetime supply of pizza that (or anything else for that matter) if you have been in business and have studied marketing at more than a superficial level, that you’ve heard the cliché that it is seven times easier to sell an existing customer than it is to sell a new one.

Depending on your market in can be higher.

According to one of the world’s most highly paid copywriters (actually getting paid to write copy, not selling products with his copy) Clayton Makepeace:

“Existing satisfied customers are about ten times as responsive as cold prospects.”

“So why wouldn’t you be willing to spend FOUR Times your cost of acquisition cost to keep them.”

You are still ahead because your existing customers are so much more responsive.

That means four times your acquisition cost can be invested each year to keep your customers happy, responsive and looking forward to receiving marketing from you.

You can do this all sorts of ways:-

  1. Provide high value non-sales driven content
  2. Invest in gifts just for being your customers such as:-
    a.) Customer appreciation nights
    b.) Any sort of unrelated gifts that would be appreciated by your market – they would see as ‘Cool’
    c.) Free trial of use of your products
    d.) And so on
  3. Lost customer reactivation campaigns

As long as your customers remain responsive why wouldn’t you try really hard to keep them? It takes time to get a new customer to become really responsive to your marketing and to build up a relationship as strong as your have with many of your high value existing customers.

As part of our newsletter suitability audit we can help you work out what it makes sense to spend on customer retention vs. their lifetime value.  To arrange a newsletter suitability audit call 1300 120 006 or else go to www.newslettermarketingsystems.com.au/get-started We are looking forward to helping you get more out value out of your existing customers.

Making Personal Change Inevitable (It only takes a $10,000 cheque…)

making-personal-change-innevitable Recently I have become rather obsessive about my time management and productivity, I’ve invested a lot of my time listening to recordings of Eben Pagan’s productivity course ‘Wake Up Productive’ (Which I highly, highly, highly recommend to anyone and everyone).  I become engrossed in this course.

I learned a lot about myself and my habits, I realized how unproductive many of my habits were… So I created a rather extreme weekly routine, one that has my eating, drinking, breathing, meditation, working, and education all planned out. It’s so extreme it even tells me how many times I need to be chewing my food and how many deep breaths to take…

I asked myself: HOW CAN I LIVE LIKE THAT? So strict, so regimented? Well the reality is, I will only be following the strict routine for 30 days, then it will start to become new habits, eventually it will start to feel weird to not do it that way. Zac and I already have that sort of extreme structure in one area of our lives. Getting our client’s newsletters our on-time every month.

My aim is to re-calibrate my ‘default’ habits to something planned and productive, something that’s motivating and healthy. Something purposeful, not accidental.

Most of us have probably tried to stick to a healthy diet or exercise routine and know how hard it can be. (http://www.youtube.com/watch?v=5RLAGxUbp-U – this video perfectly explains my attempts at healthy eating in the past) – So you can imagine how hard it is to totally overhaul all my old habits.

What can I do to ensure that I don’t fail… How can I make my success inevitable?

The answer is accountability, reward and punishment! – using Eben Pagan’s model of inevitability thinking I have taken dramatic action to make sure there is absolutely no way I can fail. Because I know I am 100% capable of doing everything I’ve set out in my routine, it’s just my old habits that stop me most of the time.

I have written a $10,000 cheque to a political party that I don’t support and given it to a trusted friend who is keeping me accountable to my commitment. If I do not report to her about my daily results, she is to hand the cheque over as a donation.

Not to get out of bed in the morning at 6am, will cost me $10,000. Eat a greasy cheese-burger, or if I don’t do my daily exercise it will cost me $10,000. On top of this, I’m rewarding myself at the end of the month with a full body massage, plus all the health and wealth benefits that will come with establishing new habits.

This may seem extreme to some people, but it works. I know I won’t lose the $10,000 because I am confident in my ability, I know that the main reason I revert back to my old habits is because there is no short-term consequence… Now that there is a consequence I find change extremely easy!

One of the key things that I have built into my routine is doing the most leveraged thing in my business, first thing in the day, and that is writing relationship-building content for my newsletter and ezine. By writing my ezine first thing in the morning.

To take advantage of our highly regimented process for getting your monthly customer newsletter in the mail then call 1300 120 106 or email info@newslettermarketingsystems.com.au and so that you can take advantage of our highly effective system in your business – growing your customer loyalty, repeat business, referral rates and more.

If you really are that great then PROVE IT!

When I was at a party recently, during a conversation a friend said to me “I can scull a pint of beer in less than 4 seconds”

I was pretty sceptical because he didn’t really look the part, So I said to him, “I don’t believe it, prove it to me?”

I was disappointed when he said “Sorry, I’m driving home today”, I thought, all talk, no show.

Then one of my other friends chimed in and said “He can, I’ve seen it! It’s amazing.”

Now I was still a little sceptical, after all my friend could be exaggerating. Then my friend pulled out his phone and said here watch, the he pressed play and I watched a video of this guy with a pint, he tipped his head back and 1… 2… 3… 4.

Wow I was impressed. Now I believed him!

This story is very similar to your business and your marketing. Unfortunately when you talk yourself up and say “Great Range, best prices, friendly service” you will be questioned at best.

So, if we can’t ‘brag about our strengths’ how do we convey these benefits to our customers? – Proof.

There are 3 main ways you can convey proof:
Testimonials – much like my friend saying ‘He can, I’ve seen it”, you can use testimonials to showcase your strengths by having your happy clients convey their appreciation for the massive range, the excellent service etc. in their message. Testimonials can be written, video or audio. Accompany them with as much detail about the person giving the testimonial as you can, eg: name, suburb, business name, website etc. It helps with believability because just as I questioned my mates comment about seeing my other friend, your customers are going to question your testimonials too, but it is a better than blatant ‘bragging’.

Before & After – If you do interior design, show before and after shots of your work to prove that you can deliver. If you are a real estate agent, show them a bunch of sold signs with you next to your happy customers. If there is any way that you can prove through images the results you deliver then do it. Think of ProActive with their before and after pimple shots or the weight loss adverts. Social Proof works.

Demonstration – Even before and after photos can be questioned, customers might think that maybe it’s not really your work or it wasn’t your product that got those results… So the next step up is like the video I was shown of my mate sculling a pint, a demonstration. This can be in the form of a video, a public demonstration, a taste test, try before you buy etc. You need to demonstrate to your customer before they will believe you. Have you ever had the Kirby Vacuum guys ever do a demonstration? You want to buy after they prove to you without a doubt what their vacuum can do, in your living room, on your dirty carpet… It’s the ultimate proof.

If you are not using proof in your marketing then you are probably leaving a wad of cash on the table because people are sceptical about your ability to deliver. Show them that they are wrong and prove it to them!

Closing the Loop on Your Marketing.

Last month I wrote a newsletter for my subscription newsletter clients about Customer Lifetime Value and how it controls your business. It determines how much you can realistically spend to get a customer.

The only thing limiting you increasing your customer’s lifetime values is you. Your creativity and your willingness to make it a priority. After all, you have more choices than you know. There is always going to be a way to increase CLV.

The higher your business’s Customer Lifetime Value the more you are able to create circumstances that will allow you to spend more to get each customer. This is the magic of Closed Loop Marketing. The more you can spend to get a customer the more customers you’ll get… the more it makes sense to find ways to increase CLV even higher so you make even more money and you can spend still more getting customers…

Being able to spend more to get a customer opens up new media opportunities. Media that was previously too expensive will be open to you. If it was too expensive for you it was probably too expensive for your competition so they aren’t using it. Making it much easier to cut through the marketing clutter, when you are reaching out to new customers.
On top of having more media open to you, your business can invest in better quality marketing through more testing and increased media investment which means that your response to each step will increase.

You’ll also be able to afford more follow up. Higher CLV means that you can afford to chase each lead for longer by having more follow up steps. Dan Kennedy talks about one of his students that added 6 follow up steps to his marketing and added 50% to his turnover. Higher CLV means that adding those six steps is far more likely to pay off big time and warrants you investing in them.
The single biggest cause of low CLV is customers wandering off because you don’t put a fence around them and make retaining them for life a priority. Ben and I recently did a webinar for a client where he explained 5 strategies for monetising your existing customers. But none of them will work if you aren’t building an ongoing relationship with your customers. Using those 5 strategies in your business will radically increase your CLV beyond what it is currently.

Click Here and you can read about the 5 strategies you can use to increase your CLV and how you can start building a relationship with your customer today – so those 5 strategies pay off for you big time.

The Irresistible Force In Business

A couple of weeks ago I saw a documentary called ‘Life After People.’ Grim title. But the gist of the documentary is about what happens on earth after humans suddenly become extinct.

Perhaps the most amazing thing about the documentary is that after 500 years, an alien coming to earth would never know that human civilisation had even existed.

The final scene in the documentary is 500 years after the extinction of humans. The Hoover Dam Shatters. A massive wall of water thunders towards the Pacific Ocean and the wetlands at the mouth of the Colorado River return. The last human monument gone – not a trace of civilisation left on the planet.

It talks of the massive power of persistence. Drip enough water on a stone and it erodes away, but it takes time. Lots of it.

Over time, water carved out the Grand Canyon. It will destroy The Hoover Dam – the most permanent structure modern man ever created.

Your newsletter works the same way – given enough time it can carve out your Grand Canyon – and in it will flow ‘a river of customers.’ Coming directly to you. Customers that are willing to pay any price you ask. And are ready to buy now.

The problem is one of time and persistence. A mentor of mine is fond of saying “Most people over estimate what they can get done in a year but underestimate what they can get done in 5 years.”

In our newsletter suitability audits we spend a lot of time showing customers just how little a newsletter has to do in the first 12 months in order to get a return on their investment.

Many times we neglect to paint a bigger picture because of our own short sightedness and that of others. Nobody starts a business with a plan to run it for a year. They are looking for something to sustain them over their lifetime. But most of us only look to getting through the next week, month or quarter.

Rarely do we think about long term market dominance and forging a strategic advantage that nobody can overtake quickly.

Persisting with a newsletter will carve out a grand canyon for you. Give it the time to work its magic. You’ll be the dominant player in your market; you’ll have so much good will built up that customers won’t think of shopping around. You’ll be the one they buy from because in their minds you are the only one who is out there.

Think Big. See the Whole Picture.

Zac Nelles.

P.S. Michael McLean took this Long Term view of his business and now gets a return on investment of between 2:1 and 7:1 on his customer newsletter mailing it 12 times a year to all his customers. We’ve just posted an audio interview with Michael McLean. Download it and listen to it and I’d be surprised if you only come away with one good ideas you can implement in your business.

Santa Vs. The Easter Bunny

Who Is The Better Marketer?

With Easter been and gone Bluesfest over and a lot of time sitting in airports… As I’m writing this I’m in a departure lounge about to fly to Cleveland, Ohio for a 2 day intensive copywriting workshop with Dan Kennedy (24 others and myself – you don’t get a chance at that much of Dan’s attention)

I’ve had plenty of time to stop, reflect and occasionally do some thinking about useless things. One such topic was Santa Claus vs. The Easter Bunny and who is the cooler guy?

Santa keeps a list and whoever has been deemed to be nice gets a present.

The Easter Bunny gives EVERYONE Chocolate.

Both strategies have merit. But I think the Easter Bunny is the better marketer. Apply this to who you send your newsletter to… Everyone? Or just the ‘nice ones?’

Considering that you don’t know who is in a person’s network, it makes sense to be like the Easter Bunny at first. Send your newsletter to everyone on your list. Build up the emotional bank account.

If you get a referral from someone who you didn’t think was going to even become a customer you have done yourself a service. The cost will be well below what you can get a new customer from advertising.

You never know, some of those unconverted leads may become a customer too thanks to your newsletter.

Santa would say watch them and if they do something nice, reward them with newsletters.

I hope we are all grown up enough to know that the law of reciprocity is at work here. If you don’t give first it is unlikely that you will receive anything in return. So that is why the Easter Bunny is the better marketer.

But we know that if someone doesn’t give back after you have given them a lot consistently and persistently. (in money terms not because you are impatient and want a referral now) I mean years of newsletters – they are cheap to send each month. (If you had 36 chances over three years to get a referral from a customer for $72 would you take it?)

However, if they are nice and send us a reward in the form of purchases or referrals then they certainly deserve to be sent more newsletters so that they have a chance to reward us again.

But Best to be like The Easter Bunny with your past present and potential customers for now.

Happy Easter.

The 7 BIG Lies That Media Reps And Advertising Agencies Use To Hinder Your Success And Take More Of Your Money

Below is aa article that debunks the ‘false’ information about marketing that small businesses have unknowingly been ‘tricked’ to believe. Although most of these ad agencies and media reps are telling you lies, most of them truly believe what they tell you. They have not been taught any different and are passing on false information that is costing you BIG money.

I’ve come from a media and printing background so I’ve seen it first hand, I know the profits that are made from people being ‘oblivious’ to the truth. It’s time to take a stand and stop believing these lies.

BIG LIE # 1 – You Need To Spend A Lot Of Money On Advertising To Make It Work

Traditional advertising isn’t exactly cheap. But you don’t need to spend a fortune on it to get results from it. Most people have come to this limiting belief because they’ve tried different forms of advertising before and haven’t had any great results. This lie has become the reality for so many businesses because they’ve never been shown the ‘smart’ way to advertise. If you leave your advertising design to be created by: the newspaper, the yellow pages rep, the commercial printer or the graphic designer, you will never experience great results because, 1- They don’t know how to create ads that compel people to contact you. 2 – If they did know, they wouldn’t tell you because it conflicts with their “bigger is better” and “get your message out there” principals that they earn their money from.

BIG LIE # 2 – Get Your Message In Front Of As Many People As Possible

Many of us have been tricked into believing that if our ad is heard or seen by more people that we’ll get more results. We slap it on a billboard. Paint it on a park bench. Cover our cars in it. Put it in newspapers or place it on the radio. We do whatever we can to get our message in front of as many people as possible. This is the wrong approach. It wastes your money and energy and the results are usually very poor. Instead you should be crafting a compelling, targeted message to a small group of people who are potentially interested in what you do. Instead of just advertising here and there and praying to the advertising gods, you should be creating a strategic plan for your marketing where each ad has a specific purpose and everything is reliable, predictable and measurable.

BIG LIE # 3 – Bigger Ads Are Better. – If Your Ad Isn’t Working, Try A Bigger Ad

We’ve all heard it from the ad agencies; if we make a comment about the poor response we had from our ad, they will try to sell you that bigger ad. They are not interested in getting you results; they are interested in selling you more space. Certainly bigger can be better, if you have a successful ad, then if you make it bigger, generally it’s more exposed and you may see an increased response rate.  But the reality is – The smallest size ad on a page can have more eye appeal and garner more response than the biggest one on the page. It’s all about the message and the approach you take. By changing a single headline on an advert, I have seen cases it results in a 600% increase in the response rate. It didn’t cost a cent extra, whereas, if you went “bigger” with the same message – it would cost you more and probably give you similar results. So only once you “know” your ad works, then you test going bigger.

BIG LIE # 4 – Pretty, Colour Ads Stand Out And Get Better Results

You’re probably thinking “this isn’t a lie” – But if you approach your advertising from this angle, you will generally see poorer results. The average graphic designer is paid a minimal amount on an hourly rate with no incentive to get you results. They have a set formula they use to pump out ads quickly, this structure is “This is who we are, This is what we do/sell, This is how to contact us.” And then they pretty it up in colour. But this structure doesn’t work. Don’t get me wrong, pretty has its place, but in the cluttered advertising world, if it looks like and ad, then you’ve got less than 2 seconds to get their attention. An ugly ad can have and often does have a much better result. And in a pretty, full colour world, the monochrome ugly stuff stands out! Colour does have it’s place, but use it intentionally, not just beacause it looks nicer!

BIG LIE # 5 – Use Images! – A Picture Is Worth A Thousand Words

This is a completely false statement, it’s true that images can be impactful, certain images evoke emotions and can make people feel a certain way. But the images that most businesses put on their advertising are pointless and just filling space. Images distract people from your message and the space is usually better utilised with more text, a testimonial or in some cases left blank. If you need to use an image make sure it actually ads to your message, evokes the right emotions, and isn’t just used to make the ad look prettier. If the image does not add to your message then lose it.

BIG LIE # 6 – With Advertising, You Can’t Expect Results Overnight

There are two kinds of advertising: branding and hardcore, retail-oriented, direct response, lead generating, low cost, overnight results-getting advertising. Building a strong, lasting, competitive brand image takes a long time. It’s built over generations with millions of advertising dollars. That’s why you don’t and can’t just brand your business. What you need is results. The good news is… results can happen overnight! – If your system is sound, your ads are positioned correctly and your message is crafted right, the results will be immediate. You can turn it on and off like a light switch. So stop trying to brand your business and focus on getting results instead. When you have a spare million then we can talk branding.

BIG LIE # 7 – You Can’t Control Word-Of-Mouth Advertising

We all rely on word of mouth advertising. It is by far the best form of advertising. Most businesses who fail at traditional advertising are only in business still because of this form of advertising. But almost everybody also agrees that it’s impossible to control. That’s a load of bull – started by the pay-per- advertise media. They don’t want you to find out that there’s a way to control the best advertising process of all – the one that’s 100% free.  There are many things you can do to encourage referrals. It starts by altering your internal operations to stand out and be remembered, give them something to talk about, provide unbelievable service, and deliver massive value. Then implement a referral system that encourages and rewards referrals. This is such a low-cost method that will have a massive impact on your business.

The 7 Key Actions To Get The Strategic Advantage in Business

Below are 7 key actions that I recommend to the majority of businesses that I talk to if they are looking to get the strategic advantage in business and want to dominate thier industry.

There are many other actions that will allow you to dominate even more, but these 7 are what I would call the “Key” actions that if done properly will make all the difference.

1.) Define & Promote To Your Clients, Why They Should Use Your Business Over Every Other Competitor

If you can clearly define a unique reason why prospective clients should use your business over every other competitor it will give you a strategic “angle” for all your marketing. You will no longer be comparing your business to other businesses based on price alone because you offer something unique that they cannot get with any of your competitors.

2.) Create A System That Attracts New Clients

What you need to create is a predictable, reliable, profitable marketing system that delivers you with an abundance of pre-qualified prospects who are ready to buy from you and only you.

3.) Build A Database Of Prospects & Clients

You need to build your database of prospects and clients so that you can market to them. If somebody enquires and does not proceed with the work, then chances are they may still be interested, just not now – If you have a database, it becomes much easier to contact that prospect again and get the sale “down the line”

4.) Create A System That Retains Customers and Build Relationships

By keeping in contact with your clients on a regular basis, they know you better and when it comes to your product or service, you are in to fore-front of their mind. The contact is not “sales” contact, it is friendly, educational and entertaining contact. This builds the relationship with your database. It can be done online, in print or even over the phone. You want to systemize this contact as much as possible and use a combination of different methods of contact.

5.) Implement Strategies To Generate Repeat Sales From Existing Clients

You need to build in systems that make your clients spend more money with you more often, there are a variety of different options such as loyalty programs, gift cards, special offers, buy 5 get 1 Free deals etc. By building this into your business you ensure that you extract the highest possible return from each client.

6.) Stimulate Referrals From Existing Clients

Word of mouth is still the best method of building your business, so it makes sense to put a system in place to stimulate it! You can create referral programs that encourage your existing clients to refer business to you and reward them for it. There are strategies that make it extremely easy to get the exact message you want to your clients “friends, family and associates” which takes very little time to implement.

7.) Stay Educated & Constantly Innovate To Stay Ahead Of Your Competitors

Don’t get complacent with your systems and success, always be on the look out for new ideas, new technologies, new marketing avenues. Get yourself a mentor who can keep you informed and educated about the latest marketing tricks and strategies.

The Most Important Business Lesson I Ever Learnt

Fresh out of University, I got my first job in sales. I started out as a door to door salesman selling roof restorations. I was okay at it, but not great. I realised 2 things very quickly #1 I could make better money by starting my own roofing business doing exactly the same thing I was doing I teamed up with a roofer to do just that.

The second thing I realised not long after I started the business was that I was selling all these jobs but I wasn’t building any equity in the business. I realised that when you sell a roof restoration you don’t need another one for about 15 years or more. So tomorrow, I had to do it all over again if I wanted to eat. If you sell a roofing business there really isn’t too much to it apart from the hard assets, some good will and whole lot of liability for the warrantees on the past jobs.

So I was out pounding the pavement day in day out and not building a business. I owned a job, nothing more. My income was going to be tied to the number of new customers I brought in and that if I really wanted stability I needed to be able to create additional sales from my existing customers.

I tried to overcome this by adding water tanks, gutters leaf screen and irrigation. But it didn’t really do the job. Gutters and water tanks are guaranteed for 25 years – same problem as the roof restorations.

I was never able to get the customers I had to provide me with predictable steady ongoing income – the real key to having a stable business. By the time the Occupation Health and Safety Laws came in I saw the writing on the wall for that business. Who would pay me an extra $5,000 for the privilege of doing a $3,500 job when there were sole traders around who didn’t need to charge the $5,000?

To this day that roofing business made me appreciate how hard you have to work to get a customer.

It also taught me that if I wanted another business, I needed to have a business that allows you to leverage your existing customers and to make customer retention a priority in your marketing activity.

To find out how you can get an iPad 2 and a $2,000 holiday voucher*, while at the same time locking your customers in for life, schedule a Newsletter Suitability Audit. To find out more, go to www.newslettermarketingsystems.com.au/get-started or else call 1300 120 006. Every day your hard won customers are defecting because you don’t have a system to keep them loyal to you. Put an end to it NOW.

* condition apply

The Three Customer Referral Types

Referrals are an important part of every business. In fact, most small businesses are built on referrals alone. Referred prospects are much more likely to do business with you because you have been recommended, they have a much higher initial trust with you and they have seen that you can deliver what you promise.

Many business owners believe that the only way to get a referral is to WOW the customer with great service and they will tell their friends. While this gets you referrals, it is not the only way to get them. I’ve discovered three main types of referrals, there are a few others, but these are the main three ways that referrals occur.

  1. Customer Tells A Friend or Colleague  – This type of referral usually happens because you WOW a customer and they are happy with your services. These referrals are the most genuine, there is often no reward and they are referring purely because they believe their friend or associate can benefit by contacting you. These people are MUCH more likely to convert into a paying customer than a cold prospect. The downside to these referrals is that you have no direct control over them, if someone tells a friend about you, you can’t follow up, you can’t market to them or build a relationship etc.
  2. Customer Tells You About A Prospect – This type of referral is often used by businesses who have a strong sales team. This method generally involves giving your clients an incentive to refer people to you. Usually you’d ask something like “If you know anyone who might be interested, give us their details and we’ll contact them on your behalf and if anyone goes ahead, you’ll be rewarded with x.” – These referred prospects are more likely to convert than cold prospecting because by mentioning their friend, you’re much more welcome when you make the first contact. It is a lot more work that the first contact method because YOU actually need to put in the hard work. The other benefit is that you have their details, you can follow up, market to them and you have control of the referral.
  3. Customer Tells a Friend AND Tells You – This is the ultimate referral. It combines the above two referral types. They tell their friend all about you and then tell you that they referred them and give you their details to follow up. I don’t know how many times I heard clients say “I referred a few people to you over the last few months, did any of them contact you?” in many instances the answer is ‘no’. If those customers told me immediately when they referred the person and gave me a phone number or email I can quickly flick an email or make a quick phone call to say “so and so mentioned you were looking for x, is there any advice or help I can give you?” – once again I’m in control of the situation and can follow up.

Referrals can be induced, it always pays to WOW your customers in every way you can, but if you want to put referrals on overdrive, build a relationship with them, train them to refer and implement a formalised referral incentive system where your customer AND the referral get rewarded.