“Lifetime Value of An UNHAPPY Customer But there’s one catch:
During A Five Year Relationship” You Must Pay Attention to Your Clients!
Let’s look at a typical unhappy or dissatisfied customer… Don’t just “close the sale,” and never talk to them again… and then
expect that when next year rolls around they will still have your
business card in a safe place and just call you. Forget it, it will rarely
happen. You also won’t get referrals from these people if you ignore
them.
A. Value of a Satisfied Customer = $3,000
B. Studies Show That a Dissatisfied Customer Tells 12 Prospects =
12 Prospects
C. Percent of Negative Referrals That Don’t Become Customers = 25%
“How do you communicate with your Clients enough so they don’t
forget about you??”
D. Lost Customers Because of Negative Referrals (B x C) = 3
Customers
E. Value of Lost Customers Because of Negative Referrals (A x D) =
$9,000
F. Total Cost of One Unhappy Customer (A x E) = $27,000
G. Total Cost of Ten Unhappy Customers (F x 10) = $ 270,000
To begin with, each of your Clients, on average, should refer three
new people to you over the course of a year. There is absolutely no
marketing cost to sell these referred Clients! The only cost that you
have is the Referral Reward. If you give your Clients a “Referral
Reward” (like cash or a gift card, a certificate for dinner at their
favorite restaurant, or even a spa treatment) every time their referral
results in a job, then you’ll only have a cost of between $25-75 per
NEW Client from referrals. I’d buy Clients all day long for $25-75
bucks!
Second, if you provide exceptional Client service then your Clients
will call you back. This is where things get exciting! These are easy
sales and they also have zero marketing costs attached to them.
Now, I’m overlooking one more major profit center... If you treat
your Clients properly, they will buy not just your main product or
service, but other complimentary products or services you can offer
as well (or any affiliate offers you want to provide them), for the rest
of your life.
MEET
JOE POLISH
So, the big question is…
Here are some answers: a monthly newsletter, a podcast, birthday
and anniversary cards, other direct mail, email, social media
engagement, straight to voicemail broadcasts, text messages and
more…
Be honest, don’t you enjoy when you get a hand written thank you
card, an anniversary gift or Facebook message? Don’t you feel a little
special when you can tell a company you do business with actually
cares about you? Doesn’t it feel “relationship-forming” when you
engage with and relate to the content that a company you do business
with publishes? Don’t you start to feel like you have a bond with
them (even though you don’t talk with them face to face all the
time)?
Well… You’re not that much different than your Clients!
I recommend that starting this month you either put together your
own informational and friendly Client newsletter, or create a
Facebook Company Page and friend you Clients, or create a system
to send out handwritten thank you cards and birthday cards to your
Clients (or all the above),
Whichever way you decide to go, I suggest you start immediately!
If you follow my advice and calculate the Value of a Client to YOU,
then spend some money on acquiring new Clients, and keep in touch
with them, I imagine you could double or even triple your business
in the next six months.
J