A business is a bucket in which alchemy is to occur. Into the bucket we pour ideas, energy, work, ad dollars, marketing dollars, costs of attracting customers, costs of pursuing sales in hope of stirring into profits, maybe wealth. Most business owners are very focused on the pouring into the bucket. Few focus on exactly what happens inside the bucket. That’s supposed to take care of itself. But it doesn’t. It’s important to have a full and accurate understanding of the investments being made. It’s then important to have a strategy in place for fully and comprehensively converting those investments into the greatest possible gains.
Often, I find business owners with more holes in their bucket than they’ve got bucket! People read your ad, get your letter, see your sign, find you online, etc.; they call or visit your website; call or visit your place of business; they ask your receptionist or staff questions; and that’s it. There’s no capture of the prospect’s name, physical address, or email address, and no offer to immediately send an information package, free report, or coupons. This is criminal waste. I’ve been poor, so I abhor and detest and condemn waste. Just how much waste are you permitting to slop around in your business? Probably a lot.
You don’t just pay for the customers you get when you invest in advertising and marketing. You pay a price for every website visit, for every call, every walk-in. Every one. Doing nothing with one is just like flushing money down the toilet. To be simplistic, if you invest $1,000.00 in an ad campaign and get 50 phone calls, you bought each call for $20.00. If you’re going to waste one, take a nice, crisp $20.00 bill, go into the bathroom, tear the bill into pieces, let the pieces flutter into the toilet and flush, and stand there and watch it go away. If you’re going to do nothing with 30 of those 50 calls, stand there and do it 30 times. Feel it. You probably won’t like how it feels. Good. Remember that feeling every time you fail—and it is failure—to thoroughly follow-up on a lead or customer.
How to Find an Extra Million Dollars in Your Business
Could you use an extra million bucks?
If in doubt, ask your wife or kids about it. If put to a family vote, maybe to a vote of your vendors and bill collectors, I’ll wager the answer is a yes. And less facetiously, more practically, would your future benefit from getting an extra million dollars put into your 401(k) or other retirement savings account? Well, I’m happy to direct you to where that extra million is hidden inside your business. It’s in the follow-up that isn’t happening.
Many times, owners of profitable ad and marketing campaigns are terribly slothful about this. If they spend $1,000.00 to get 50 calls, only convert five to appointments, and only acquire two as customers—but those customers are worth $1,000.00 each, they turn $1,000.00 into $2,000.00 and are pretty happy about that. But each call cost $20.00, and 45 didn’t turn into appointments—that’s $900.00. Nearly as much waste as profit. But the total reality is far worse than that. If with diligent and thorough follow-up, another five appointments and two customers could be had, he’s let $900.00, plus $2,000.00, slip through holes in his bucket. If each customer can be made to refer one, and an endless chain of referrals created, the $2,900.00 in waste goes to $4,900.00, then $6,900.00, then $8,900.00, then $10,900.00. Let that happen once a month, it’s $109,000.00 that should have been in the bucket that leaked out onto the floor. In ten years, it’s a million dollars. It’s my experience that in just about any small business, over a ten-year term, there is at least one million dollars in lost money to be had. If you own a small business and would like to retire as a cash millionaire, here’s your opportunity.
This is how to use this book to make millions. Direct marketing is never just about acquiring customers—what we call “front end.” It is as much or more about retaining, repeat selling to, cross-selling to, and ascending customers on an ongoing basis—what we call “back end.” It is also the means of building a system to prevent leads or prospects, who could be converted to customers, from getting lost and coming and going unnoticed. See Figure 5.1.
FIGURE 5.1: Holes in the Bucket
Here are some of the holes in business buckets, through which money leaks:
1. As just described, the person who calls and asks questions, stays unknown, and gets no follow-up. Remember, you paid for that person. If you don’t capture his contact information so you can do follow-up marketing, you wasted your money.
2. Little or no follow-up on leads obtained at trade or consumer shows. This is particularly abysmal. In my most recent experiment at a big, local Home & Garden Show, I visited nine competing companies’ booths, very clearly presented myself as a viable prospect for their products, made it clear I was not interested in lowest price, and made sure they had my complete contact information (except email, which I do not use).
And what follow-up did I get? By mail? Zero. By phone? Zero. Each of those exhibitors paid to get me, then they did nothing with me.
3. No follow-up on referrals. When Betty says, “I told Billy about you. I hope he gives you a call,” the correct response is not: “Thanks, Betty. I hope he does too.” That’s the common response, but it most certainly is not the correct response. You ask for and get Billy’s address so you can send him a copy of your book or information package, with a note mentioning Betty’s recommendation or a note from Betty, and an offer or offers (Rule #1). If Billy fails to respond, you send him a second letter. And a third, fourth, fifth. With offers. And you put him on your newsletter list and send him your monthly newsletter. With offers. You enroll him in your six-week email “course” tied to your product or service. That’s follow-up.
Resource Alert!
REFERRALS PROPERLY MANAGED can, alone, increase most businesses by 20% to 50% year-over-year. The No B.S. Guide to Maximum Referrals provides a comprehensive blueprint for achieving this kind of growth from financially efficient internal marketing instead of costlier and more difficult external advertising and marketing.
4. No immediate follow-up to new customers. Newly acquired customers need to become frequent and habitual repeat purchasers or ascend to higher levels of membership or somehow move from first transaction to committed relationship. This means they need to be quickly thanked, welcomed, and brought back, moved up, or otherwise committed. Think about the last five times you patronized a business for the first time—store, restaurant, service company, professional practice. What formal thank you did you get? In four or five out of five, none. What “welcome to the family” gift did you get? None.
5. No prevention or organized rescue efforts related to lost customers. For more than 30 years, surveys have consistently revealed “indifference by provider” as, by far, the #1 reason customers leave a business and drift elsewhere. Not some egregious act of incompetence or negligence or insult, not cheaper prices, not anything major. Just a sense of indifference toward them. That left them open to easy seduction. The best answer to lost customers is, of course, not having any. That requires very frequent, very consistent, and interesting online and offline communication. I teach 52 contacts a year, although I do more and GKIC does more. But on-time rescue efforts also work. Every kind of business has a set time by which a customer should be back—for the clothing store, it’s once before each season; for the diner, it might be every morning; for the auto salesman, every three years.
Whatever it is for you, alarm bells should go off for every customer not back before his stamped-on expiration date, and that alarm should set in motion a flurry of marketing and follow-up activity.
There are other holes. I’ve just named five. You have to find every hole in your business and plug it.
What Does Follow-Up Look Like?
There are hundreds of variations of follow-up campaigns and strategies. One of the most reliable is structured in four main steps—although, mixing in low- and no-cost online media like email, each main step may have a handful of contacts, not just one. Today, you have many opportunities to create closed loops, to keep re-engaging prospects. Email and/or mail might drive to a specific website housing a video sales letter or voiced PowerPoint presentation; the viewing of that triggers an email sequence and an outbound telemarketing call; a no-sale by that sequence and call triggers another predetermined sequence driving to a different website and video sales letter. It can all be automated. I currently have a client using four such closed loops, one after the other, each starting as the prior one ends, and, in total, encompassing 48 online contacts, 11 offline contacts, 4 online presentations, 2 phone calls, all over 12 weeks. This is all deployed with precision: every follow-up contact is set for the fourth day, sixth day, ninth day, etc.
Here is a simplified, abbreviated look at a four-step follow-up campaign.
Step 1: Re-State, Re-Sell, and Extend Same Offer
Whatever they didn’t do or buy is presented to them again in the best way possible. There is acknowledgment at the start that they are getting your letter or other communication because they didn’t buy. The message will acknowledge that there are x-number of reasons people don’t respond or buy at the first appointment, visit, conversation, etc., and these reasons are then answered and made to go away. The original offer is made available, with a new deadline for response.
Step 2: Stern or Humorous “2nd Notice” Tied To Onrushing Deadline
Classic themes and opening gambits include the good-humored, like “Are You Lost?” or “Frankly, I’m Puzzled,” to the serious and stern, like “I’m Deeply Concerned about Your Failure to . . .” or “Are You a Man or a Mouse?” The offer is again presented, the deadline emphasized. Sometimes, the offer is slightly altered, perhaps with longer installment financing or a new or additional gift with purchase.
Step 3: “Third and Final Notice”
This ties to the deadline and the disappearance of the offer. For a pest control company offering termite control to its route customers, I designed this Final Notice to come from the company’s attorney, in a law firm envelope, explaining that, in order to safeguard the pest control company from any liability for negligence in not fully protecting its customers’ homes, it was required to clearly notify them of the hazards and costs of failing to treat a home with termite protection.
One great example of a good-natured sequence covering these three steps is in my book The Ultimate Sales Letter (4th Edition)—the famous Giorgio Italian Restaurant letter sequence.
This has been a direct marketing staple for a long, long time. The very first Direct Marketer of the very first (albeit dubious) “cure” for what we now gently call E.D., or erectile dysfunction, Dr. J. R. Brinkley, a turn-of-the-century promoter of goat testicle grafts to men, generated leads by radio, print advertising, direct mail, and publicity, asked them to travel from hither and thon to his clinic, and followed up on the recalcitrant prospects with sequences exactly as described here. His marketing was so fascinating and so far ahead of its time and so remarkably effective, Chip Kessler and I wrote an entire book about it, rich with actual samples of Brinkley marketing gleaned from a historical society’s archives: Making Them Believe: The 21 Lost Marketing Secrets of Dr. J. R. Brinkley.
Step Four: Change the Offer
Sometimes the offer can be altered relatively easily—by offering new or more extended installment payment terms, by swapping out a bonus for a different bonus, that sort of thing. Other times, the unconverted prospects are telling you they don’t like your solution to their need, interest, or desire. That doesn’t mean the need, interest, or desire is gone. Mary responded to your ad because she wanted to lose two dress sizes before her friends’ annual July 4th beach party. You offered her six weeks of supervised exercise in a gym. She rejected you. She still wants to lose two dress sizes by July 4th. She doesn’t want to come to a gym three times a week. She might buy at-home personal training or a diet plan or pills or a gadget. Some business owners are limited to Steps #1 to #3 and, as a practical matter, can’t do #4. But a lot more can, if they would, than do. Trade schools began offering the option of online training for this reason. The “online university industry” is a response to the same rejection of offer but continued desire for solution with regard to post-high-school education, career training, and degrees. Weight Watchers, famous for weekly meetings complete with weigh-ins, also added the alternative of online coaching and support for the same reason. Big direct marketers in the same interest category achieve this 4th step by swapping lead lists. People who respond, for example, to advertising about a money-making opportunity in real estate and stubbornly reject the offer are turned over to a marketer of a money-making opportunity in homebased ecommerce, in exchange for that marketer’s list of prospects who have rejected his offer.
Important Reminder: Obey ALL the Rules
All your follow-up efforts by any and all means—even direct conversation by phone or face to face—should adhere to all ten of the Rules that I’m presenting.
Resource Alert!
Right about now, it may occur to you that the level of complexity in the precision-timed, multistep, multimedia marketing and follow-up campaigns I’m suggesting is beyond your capabilities—and you may be right!—but you do not need to remain hobbled; there is help to be had. There are marketing system automation experts, services, and software specifically facilitating all this for small-business owners.
I recommend investigating:
Infusionsoft: the leading and arguably only software built from the ground up to automate Dan Kennedy-Type Marketing, https://ww2.infusionsoft.com
eLaunchers.com: Certified Infusionsoft Consultants and much more are available to design and build custom online/offline marketing systems, facilitate off-shelf online/offline marketing systems and campaigns, and design and host sites (elaunchers.com/kennedy).
GKIC: A comprehensive support company, network, and membership organization for entrepreneurs committed to direct marketing. It is a portal to selected, expert vendors, and its own web services division offers audits and assessments of existing websites and linked marketing (GKIC/COM/WEB). All new GKIC Members are invited to FAST START/IMPLEMENTATION BOOT CAMPS (see page 229).
Dan Kennedy: For businesses of sufficient size, with opportunities of sufficient size and scope, I accept private clients for strategy consulting, marketing system development, copywriting, video sales-letter scripting and production, and coordination of a “project team” of best vendors, as needed. There are also a number of industry-specific groups that I provide such services to that you might join, in fields such as dental practice, orthodontic practice, financial advisory practice, and others. You are welcome to contact my office directly with any query, via fax: (602) 269-3113.