There are numerous marketing systems and methodologies in the marketplace but what makes all of them work is your involvement with your customer or prospect. I believe to a certain extent all systems will work or won’t work based on the level of  involvement. What most systems will do is help you develop certain touch points that will identify and link your product or services to your customer base. How well you can make this authentic and even transparent can be very important. Point in case is social media. It is OK to schedule tweets and blog post to become more efficient but without some actual real-time conversation it is soon recognized by your followers that this is indeed just a platform for you to blast out your message.

I have included a description of the first two  stages of the Value Stream Marketing process:

The Define(Involvement) Stage: The Define stage typically asks us to start with a problem statement. In the marketing sense, can you define the problem that you solve for your customers clearly? Where the problem statement describes the pain, the next statement should describe the relief that is to be expected. After that, we go into a process that is typically defined as Voice of the Customer. There are typically two major categories that are required; Output requirements and Service Requirements. The output requirements relate to the final product or service that is delivered to the customer. The service requirements relate to how the customer would like to be treated and served during the process. The final step in the Define stage is to document the process. Typically, this is done with a high level process map. Don’t worry about it being completely correct as we will use it and develop it further in the remaining processes. More on this Subject: The Marketing Funnel using Six Sigma DMAIC – Define stage

The Measure(Influence) Stage: In the DMAIC methodology we use tools such as Critical to Quality and other tools to determine what is important to a prospect. Instead of thinking about this step from an internal point of view step back and consider what the prospect would use to measure your product or service and make the decision to move through the funnel. Developing measures with customer input will certainly help a prospect move though the funnel. At this stage, do you know how a prospect is measuring you? What is the most Critical to quality standard that influences your product or service? What is more critical than others? The old saying is that people perform by how they are measured? If your company is based on how they are being measured, do you have measurements in places that influence your performance? More on this Subject: The Marketing Funnel using the Six Sigma DMAIC Methodology – Measure stage

These are a couple of the DMAIC principles that you can use to guide someone through your marketing stages. But what are the marketing concepts that you are using in these stages? These concepts are many of the building blocks in the Lean Marketing House Foundation and are the basic marketing tools that you are familiar with when evaluating your marketing. From the general terms such as; Advertising, PR, Social Media and Referrals to the more specific tools that you use such as; Public Speaking, E-zines, Blogging and White Papers.

A Value Stream Marketing Concept: The one concept that many fail to consider is the In direct marketing of “Staying in Touch” with your customer base. Many times your customers are just folded back into the above mentioned terms or with your regular prospects. I would like to challenge your thinking on how you can become involved in your customer’s communities. Becoming active in these areas will not only increase your involvement with your customers and other prospects but there is nothing more effective in making your marketing more efficient. Understanding their needs, what they are looking for, where they are being undeserved is the single greatest marketing concept that I know of. So, if I ask this question: Where are your customers being undeserved? Can you answer it? And/Or, is that a market you have the ability to take care of or build a future alliance from? (Related Book Seeing What’s Next: Using Theories of Innovation to Predict Industry Change)

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Can you retain this customer?

Do you really look at this as a consideration when developing your marketing segments and the value you place on acquiring a certain type of customer? Most of us look at repeat and referral strategies across the board for every segment. Though, I would not disagree that we should have a strategy for each but consider the segment or that type of customer that you acquire that always seems to give you the benefit of the doubt or refer business to you. Should you not be biased in how you allocate your resources to that segment? Would it not be beneficial to offer certain incentives to that segment? Is this not the measure that most determines the profitability of the customer? My first question to most new clients: Do you have customers that refer you, and why? That is the strongest indicator on the health of the brand.

A great book on the subject is The Ultimate Question by Fred Reichheld. The Net Promoter website is a great place to start. To calculate your company’s Net Promoter Score (NPS), take the percentage of customers who are Promoters and subtract the percentage who are Detractors.

When John Jantsch author of Duct Tape Marketing, talks about the Marketing Hourglass, he says, “The top half indeed resembles the funnel concept, but the expanding bottom half, to my way of thinking, adds the necessary focus on the total customer experience that ultimately leads to referrals and marketing momentum.”

Just considering these statements above you can see why I feel so strongly that you need to consider throughout the entire marketing process your ability to maintain and build that customer into a repeat/referral customer. The initial sale should be nothing more than allow your best advocates to experience the entire brand! If you have segmented your marketing channels into: Who you want as a customer (part 1) and Who wants you? (Part 2), the next logical step is, Who will repeat and refer?

Losing customers is the clearest possible sign that customers see a reduced stream of value from the company. It is simply the strongest indicator that a brand is in trouble, even if you are replacing the lost customers with new customers. New customers typically cost more to acquire having to go through, the entire hourglass and older customers are working in the bottom half of the hourglass. Since that is true, repeat customers tend to produce greater cash flow and profits than newer ones. Referral customers are also more profitable because they typically enter the hourglass not at the top but at a much lower stage.

Ask yourself, does retention and referrals matter? Put numbers to it. How much does it cost to obtain new customers, to retain old customers? Consider, do the repeat/referral customers have different purchasing patterns? What makes a repeat customer attract other customers?

How would you go about in gaining a repeat customer? I believe customers evaluate you based on three areas: Value for the price, Quality, Service. If you provide metrics that are very responsive to these areas and continuously educate to receive input from your customer base, you will go a long way in retaining clients. However, these measurement metrics must not be at the expense of your customers time and resources.

You should consider ways of making them a part of your operations, service, sales and marketing processes. As an example, you may notice less frequent contact or payments extending. Look at these as signs to engage your customer. Building quality measurement systems into your process may be the most important ingredient in your marketing hourglass.

Related Posts:

Determining your Customer Perspective – Who do you want?

Determining your Customer Perspective – Can you satisfy these customer segments?

The Eagles always understood!

Referral Machine Guide

Technorati : Buyer persona, Duct-Tape-Marketing, Net-promoter-Score, Referral, Repeat, Target Market

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You get the idea. But make sure everyone knows what you do, your capabilities and whether your willing to relocate. You would be amazed at how many people will pre-qualify you and may not think to tell you about a particular job. Also, ask them to tell others about you. Don’t give them one business card, give them a couple and make sure you have a page on the Internet where they can learn more.  Ask people to tell others! If you can only get a small portion of these people in the other circles to start looking, you will have the best marketing campaign going for you that money could buy.

How do you start? Start with your family and ask them to give out a few business card. Work at being easy to know and hard to forget. Be quick to understand others and listen to them. But always give them a card. Remember, people like to do business with people they like so work at pleasing others. If you touch your 300 people in a week, just think how many people you may have working for you.

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People want to increase e-mail mailing because it is free. But e-mail is not free. It takes effort, great content and current material. E-mail is struggling as a medium, it is still push marketing. But I have this junk mail theory, if it is cool enough, it is not junk. If an e-mail is worthwhile enough, it is not spam.

I believe an active small list allows you to target your message better and therefore have a more interested party. I would have a tendency to recommend not increasing their list but segregate it into more accurate groups. I think what makes a great list is creating more of a direct message to individual groups within the entire group. Than grow it by doing this:

A suggestion, create a referral program, it is referral week:
1. Segregate the list into groups.
2. E-mail only twice a month with more precise content.
3. Personalize as much as possible
4. Ask for referrals(forward e-mails) and if your friend signs up???
5. Become a guest writer on another’s e-mail. Leave them write on yours. Each of you, of course would get a link to that persons. Ask for a signup to yours inside the post.
6. People that have customer traffic, create an offer to acquire their e-mail, especially at point of sale or a computer that could print a coupon.
7. Get and post testimonials about your newsletter, everywhere.

If they want to create a better list, make a better offer to get the name or better yet content that someone wants to read. If you want to grow your list do it from within not by trying to acquire more.

And then to start blogging.

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Service, Product, Retail, Construction, Professional services, Employee, and Volunteer … it doesn’t matter. A referral system should include 7 basic steps that helps you identify and succeed in ways you never imagined. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization .

Step #7 – To bring your referral system full circle you need to devise two follow-up steps:

1. 1. Continue to market to your referral leads that don’t immediately turn into clients.
   2. Systematically communicate the progress of a referral back to your referral sources to keep them motivated.

Since you inspect a shorter sales cycle you sometimes will give up on a referral more quickly. Well, you may find out since they entered the Hour Glass or Marketing Funnel at a different stage that maybe for this particular client you missed a step. Or, they may not have been that good of a referral and need to be educated more about your product. You should develop a system to re-qualify these people and send them back through your funnel. they may not have been viable candidates at all . However, by re-qualifying them you will have to make a decision of how to continue with them. Re-purpose some of the material in the top of the funnel and feed it back through to them. Keep the material fresh and try to automate this process as much as possible.

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Service, Product, Retail, Construction, Professional services, Employee, and Volunteer … it doesn’t matter. A referral system should include 7 basic steps that helps you identify and succeed in ways you never imagined. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization.

Step #6 – What good are referral leads if they don’t become referral clients? You must map out a specific set of steps that will allow you to convert your referral leads. What I would recommend is developing a hour glass for this process just like you do a regular sales channel. If you do this, your steps in developing a referral client will become very clear. After a while, you will begin to recognize where the referral is entering your sales cycle at. Why is this important? If the referral is strong enough the prospect may already know, like and trust you. They may be ready for a trial offer. You may only confuse them by trying to build more knowledge and sending them additional information  about your company. Understand the process and work it! A nice surprise would be that a significant portion of the sales cycle is skipped there by reducing your cost of sales.

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Service, Product, Retail, Construction, Professional services, Employee, and Volunteer … it doesn’t matter. A referral system should include 7 basic steps that helps you identify and succeed in ways you never imagined. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization.

Step #5 – This is where you devise the creative offer that makes people want to refer you. Example: “Refer 4 people that become clients and yours is free.” There are numerous offers available but be creative. A gift certificate, dinner, and discounts can be great incentives. But know your audiences and try to be outlandish. The old adage of What is in it for ME, is never more important than right now. This single step may determine the success of your program so be creative, easy to understand, and something no one else would do. 

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Service, Product, Retail, Construction, Professional services, Employee, and Volunteer … it doesn’t matter. A referral system should include 7 basic steps that helps you identify and succeed in ways you never imagined. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization .

Step #4 – Most people when meeting with a potential referral source will not only increase the number but the quality of referrals if you educate them on:

1. Who makes a great referral.
2. What’s in it for them to provide a referral.
3. How to refer you.
4. The exact steps you plan to take with that referral.

If people don’t know who makes a great referral they will either never refer or pass you leads that are not qualified at all. I always likened it to buying a new car. You very seldom see one till after you buy it. Afterward, you see the car at every corner. If you tell people what opportunity it is, it may come knocking.

You need to provide an incentive to refer someone to you. Don’t just assume they are going to do it. But before you can construct an incentive, be sure to understand what may motivate them. Some people will be satisfied with recognition, others discounts on future purchase and others may want referrals from you.

Many times people will misunderstand not only who to refer but what to say when referring you. Defining who you are to your referral partner is extremely important. Not being a client they may not understand exactly what you do. So to communicate that, the description must be short and to the point.

It is also imperative that you tell people what you are going to do with the referral. They are not going to send their friends and family to someone that is going to relentlessly pursue them. Tell your partners the exact steps you will take and do them. It will go a long way in developing the trust you need.

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Service, Product, Retail, Construction, Professional services, Employee, and Volunteer … it doesn’t matter. A referral system should include 7 basic steps that helps you identify and succeed in ways you never imagined. The principles are outlined in a 7-step process that we will communicate this week in leading up to Referral Week. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization.

Step #3 – Create and communicate your core referral message – your referrer must be able to easily explain the value you bring to anyone who they refer. “Business901 implements marketing systems.”  Now, how do you go about defining your core referral message. Is it different than your typical core message?

Your Referral Message must be very concise to your Target Referral Market. If not the effectiveness of your message will be greatly reduced and may even be non-existent. You must develop a message that has the ability to be transferred effectively and rapidly cross the network, much like the game of telephone that played as a child. If your message has to repeated: Short, concise and to the point is important. Where a core marketing message may solicit a "How do you do that?" A core referral message should solicit: Can they do this or a What do they do? More about the answers later.

Looking at my Referral Venn diagram, look at the overlapping of circles. You must envision what core message you want to express to each particular group. The trade organizations you belong to may not have any interest or similarities to the message that you are sending to you vendors. Or it may be the exact message same message you send to each. Why would this matter? By organizing your referral clients according to core message you can start build a referral funnel for each perspective group and see what message and material will be similar to each one. Many companies will develop a referral program without integration and/or try sending the same message out to all. Customizing the program to each sector will make it work but by integrating the process, you will be able to manage it and develop it to its fullest extent.

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Service, Product, Retail, Construction, Professional services, Employee, and Volunteer … it doesn’t matter. A referral system should include 7 basic steps that helps you identify and succeed in ways you never imagined. The principles are outlined in a 7-step process that we will communicate this week in leading up to Referral Week. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization .

Step #2 – Identify your ideal referral client – In order to receive high quality referrals you must be able to quickly communicate the exact type of person or business that has the ability to make great referrals. That is not hard, is it. Anyone that breathes and you have met. If you convey that message I can assure you will get exactly what you ask for, and you better be careful. But if you can identify exactly what makes an ideal referral client there will be the synergy needed to make a referral.

What is different about a Referral Client:

1. It may not be your best customer or your best vendor. It is the person that knows "your ideal client" best.
2. It always helps if the company or person that refers you is famous. I am not talking sports hero or anything but the better known may establish great credibility for yourself.
3. They need to have a built in reason to motivate you. It is still about what’s in it for me.
4. Is there a way that you can motivate them that requires little effort on your part to fulfill.
5. They need to have the ability to repeat the process. Just because they know 1 person that might buy is not reason enough to build a system around.
6. A natural connection point to your organization. If you have to work to have a dialog, both of you will not be active enough to make it work.
7. You need to be important to them. There has to be a reason that they have your best interest at heart.
8. Use social media to make contacts and follow-ups. It is a different animal, but it is an important to distinguish.

Ok, simply stated Ideal would mean: A Star with a wealth of contacts that would be willing to give them to you freely. That is ideal.

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Service, Product, Retail, Construction, Professional services, Employees, and Volunteers … it doesn’t matter. A referral system should include 7 basic steps that will help you identify and succeed in ways you never imagined. The principles are outlined in a 7-step process that we will communicate this week in leading up to Referral Week. It is the basic understanding on how to apply the Referral Flood program to Your Business or Organization.

Step 1 = Create a referral target market(s) – you must first create a target list of companies and individuals who can be motivated to refer. This can be clients, volunteers or a network of related businesses. Most people think that everyone is already doing it or would be unwilling to do it. They just look at it as a black and white issue. But I will tell you one thing; very few things are black and white. Ask yourself, who would be willing to refer my company and why? Who is going to benefit? Example: Does a Home Stager make a Real Estate agents job easier? If you want to build a strong referral network and program, sit back and think about what is the motivation for this person or organization to refer us? What is in it for them? Don’t think about yourself.

But as you go through this list, don’t start with strangers. Strangers are not going to refer you unless there is a real incentive package included. The less you know the person, the greater the incentive you must make. The more the people know, like and trust you the easier it is to refer.

This is not rocket scientist type information but it is amazing how most of us forget about it and jump into a network group thinking that someone is going to refer you. They seldom do but remember the old adage to give before you get. So think about a few of these Target Markets and how they would benefit from referring you.

The reason I made a Venn diagram is to demonstrate your Core Referral Message that will be discussed in the next post and how to hit a home run with it.

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This content from: Duct Tape Marketing 

Another Best Referral I Ever Received In a previous post I asked readers to share stories of the best referral they ever received. It was a lot of fun listening to the audios so I thought I would share a couple with you. This referral story comes from Kevin Sanders of Creative Concepts in Lancaster, CA. If you would like to share your referral stories call (214) 615-6505 ext 6998 and listen to the message prompts to leave your message.

I encourage you to leave a referral story it might be fun and you never know who may hear it!

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The live web conference is scheduled for Tuesday, March 10th at Noon CST and will be hosted by John Jantsch, author of Duct Tape Marketing.

The conference is the headline event of the educational component of Make a Referral Week.

Special offer on the Duct Tape Marketing Referral Flood Package.

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