More BFOs from Day 1 of the 2016 BEF, Troy Hazard continued.
Troy told a story about car salesman who had sold him a luxury car in Australia where he lived before moving to the USA a few years ago. The salesman asked how often he traded cars in, Troy answered about every 4 years. The salesman began contacting Troy about every 6 to 8 weeks, by mail, email, telephone, you name it – when Troy moved to USA permanently the salesman continued kept in touch. After about 4 years the salesman called to say it’s time for a new car. Troy told the salesman that he permanently moved to US and salesman continued to stay in touch. On a family visit back to AU, Troy dropped into the dealer and asked the salesman why he continued to stay in touch, answer … “I sold more than 100 cars to your friends.” The business question to ask yourself is; How is my business staying in touch with our customers, members, advocates and raving fans? (See the following section – day one BFOs from Brad Sugars – The Ladder of Customer Loyalty).
Next, Troy urged us to always have absolute clarity of where the money/profit comes from. His example was an electrician who repositioned to being a Total Energy Solution.
Troy also told us about one of his companies that had five salesmen. Following a typical bell curve, at one end of the curve was a salesman who was only doing about $60,000 in commissions and was way below quota. In the middle were three salesmen at or slightly above quota, earning $100,000 to $125,000 in commission income. At the other end of the bell curve was a salesman who was pulling in about $275,000 in commissions. Troy then threw a trick question at us, asking who he fired. Most guessed the $60K salesman. In fact he fired the $275K salesman, explaining that he was disruptive, not a team player, stealing leads from the others, didn’t embrace the company culture, etc. The business question here is who on your team is not fully engaged with the mission/vision/culture of your business? By the way, he also fired the 60K salesman.
The final BFO from Troy Hazard was very simple; Change or Die, one change at a time!
Our next speaker was Brad Sugars, the founder and chairman of ActionCOACH. Brad opened with the statement that “Profit comes from REPEAT BUSINESS.”
Next Brad presented the ActionCOACH Ladder of Customer Loyalty.
The first rung of the ladder is Suspect – a target or an ideal customer.
Suspects are moved up the ladder to Prospect via marketing. Prospects have taken some action; responded to an ad, visited your store, called to ask buying questions, etc. The BFO here relates to the ActionCOACH 5 Way Formula, “if the Conversion Rate is low, the Target is WRONG!”Prospects are moved up the ladder via sales to Shopper. Shoppers have made their first purchase. The BFO that Brad mentioned here is “the 2nd purchase is 10 times more important than subsequent purchases.”
Shoppers become Customers when they make that all important second purchase. This is where you begin to build a relationship with your customer. Have a consistent point of contact and establish genuine know-like-trust in the relationship.
As you develop stronger and stronger relationships with Customers they can become Members. Members will develop a sense of belonging. The sense of belonging must be enhanced by superior, personalized customer service and continued relationship building. The BFO here is Great Customer Service starts with doing business with those you want to do business with (see Target above).
Continued relationship building and consistent superior customer service will result in your Members moving up to Advocates. A major BFO here is every customer defines customer service differently, that is why building strong relationships is the KEY. Advocates will refer their friends and network to your business.
If you consistently deliver exceptional customer service and continue to build relationships, your Advocates will become Raving Fans. Raving fans will refer all of their friends and their networks to your business.
Whew, this wraps up my BFOs from only the first day of the 2016 BEF. Stay tuned, there is much more to come.