Steve,
I’ve been diligently tracking our numbers etc. over the past two years. This year I really looked at how much of our business was repeat vs. new. I keep spreadsheets for BNI referrals, current customer referrals, direct mailer and the newspaper article we were featured in this past September. Those three things totaled 50.6% of our business this year. I didn’t include new business from our website/Google , yellow pages or the IICRC/CRI website, so it would actually be even more. I have to go back through the invoices and break out that information too.
This is the first time I looked at the numbers this way. I was really shocked once I did the calculations. It was quite eye opening. I thought more of our business was repeat clients. I need to go back and do the same for 2008 to see if we had that much new business then or if it was more repeat and if this is the “trend”.
I thought for sure with numbers like that it would have been a higher percentage of repeat customers. I’m both excited at the percentage of new business and what that means for us going forward, but also scared that we might not be able to keep attracting business at this rate.
So, my question is, where do we go from here in terms of strategic planning? Are these percentages industry average? While we have a core group of customers have cleaning done yearly, I’d say most wait 2-3 years. (Is that typical in the industry?). How does the 2-3 year cycle play out and how should we be looking at things and planning knowing that?
I know we need to do better at keeping in touch with our existing client base to encourage more repeat business. We have been focusing on that this past year with newsletters, cards etc, but we’ve only been doing that for about a year. When can we expect to see results from that? Any other suggestions for marketing to our existing clients so they don’t just fade away? While we would love for the new customers to continue at this rate, we don’t want the old ones to fade away, and if the new customer stream dries up, we would be in trouble!
Thanks for your insight and for the continuing support I receive as a SFS graduate,
Analyzing Things in Virginia
Dear Analyzing,
You have raised some excellent questions here. Re: industry averages I’m not sure that the average carpet cleaner is “compulsive” enough (that is a compliment to you) to even KNOW what their numbers are. (I am impressed that you are tracking so many things in your company! As Chuck told you in SFS, “Every number tells a story”!)
However, anecdotally I am definitely hearing that customers are “stretching” their cleanings. This is a logical response to people feeling poorer due to this “emotional recession” we are having. So my guess your 2-3 year cycle between carpet cleanings is average or maybe even a little better than the average.
Plus remember that (as we discussed in your SFS seminar) there are other Emotional Dynamics other than the financial ones that enter in to cleaning frequency. Simply put, as carpet cleaners we are a “Tolerated Irritation” in the client’s home. Ouch! So what do you do when facing an irritation? You put it off! Not too mention that people are so darn BUSY any more! All of these factors are against you moving people to clean more often.
However, I do have one idea that we threw at everyone in SFS. Have you folks discussed implementing the “Stay Beautiful” program where your customer’s are on an easy payment plan of 10% of their one time cleaning for a twice a year cleaning frequency? Remember people SAY they clean yearly and THINK they clean yearly. They just don’t. This plan forces them to.
Check out the Stay Beautiful program for yourself, Analyzing.
Plus don’t forget as a SFS graduate you have the entire turnkey package to implement it in your SFS Operations Manual under “Paperwork” and also “Marketing”.
Thanks for writing and for your continued support.
Steve
P.S. Let’s see if that slacker Yeadon has any thoughts re: marketing ideas on increasing/motivating more frequent return business.
We can identify with “Analyzing”. The Stay Beautiful Program would be an excellent way to keep the momentum going with existing clients. We have several other new initiatives we are working on for 2010, and aren’t sure that we are ready to commit to Stay Beautiful at this time. It seems very viable, but we have committed to other things right now and will need some time to get those up and running.
I’d also be very intersted in hearing what Big Bad Billy Y has to add to see if there is something we can do in the mean time before launching Stay Beautiful.
Well the one thing that pops out at me is we are focusing on carpet cleaning. Don’t forget our real business is providing service. Most provide much more than carpet cleaning. Once we have developed the trust factor with our customers they want to purchase other services. Unfortunately many do not do a good job of letting the customer know what else we provide.
My thought is that every home we go into we should have checklist of what the customer has in their home. In other words hardwood, tile, laminate, rugs, tile, fabrics etc. Once we know what the customer owns we can target our monthly mailings to a specific product in specific homes. This allows us to focus a monthly special to a select group of consumers.
Our goal is to be in each home several times a year, thereby strengthening the relationship which should also develop more referrals.
Well, thank goodness Yeadon showed up. Well said, Bill! The SB program (I’m in sort of an acronym mood today) IS a great concept! But the Burdicks are 100% correct to not jump in before ready. You need to be committed to the program before you start it.
Now what other genius other customer return/retention strategies does Yeadon have up his sleeve or is he sneakily holding them back for the future?
Steve
BTW, folks, love the photo!