Hudson, Ink

Last time in The Sales & Marketing Insider, we looked at Lead Tracking.

Where do we go from there?

Look who’s buying – Your customer list shouldn’t be viewed simply as one large category, but as multiple levels of information. Avoid the frustration of making offers to the wrong group by taking your full list and dividing it to select the best targets.

How do you determine your most valuable customers? Here’s a quick list segmentation method I like called “RFT”.

Recency: Those who have spent money with you in the last 24 months;

Frequency: Those who have used you with the greatest frequency in the last 24 months

Transaction size: Those who have spent the most with you in the past 24 months.

1. Rank the BEST candidates according to the above and determine how big a list you can effectively contact.

2. Assemble your RFT list for a postcard offering $20 off ANY service call, PLUS a $20 gift certificate for referrals who get service work done within the next month (or whatever time period you determine).

Oh, I can hear the cries from some of you already… “I’ve got to pay $20 for each new customer?!” Actually, you’re already paying more than that. The average customer acquisition cost is $275, so this is mighty cheap by comparison, and you only “pay” when they pay you.

The gift certificate can be for a lunch/dinner, which is a nice gift. (A wise restaurant owner will sell you blocks of 10 or so certificates for as little as HALF the face value to put more diners in the seats. They may have certain night limitations.)

Now, not only will you generate leads and nearly free referrals with the right offer, but you’ll determine the value of this list to help find commonalities for a much broader contact list later. Bear with me for a sec.

3. Make the call – Follow the PostCards with a call saying, “Did you get our money-saving PostCard in the mail?” (If the answer’s is “no,” check your records.) “Great, our technician will be in the area on Thursday and Friday. Which would be a better day to stop by to evaluate any plumbing needs?” This is an alternate-of-choice close and not pushy if said by a PLEASANT smiling voice. Modify for your tastes, but you get the idea.

If your caller runs into a person who doesn’t need any work, can’t think of a referral, but says nice things, jot it down and request to use it as a testimonial.

From your customer list, a 1.3%-2.5% response is the “range” depending on quality of list and offer. Getting 50 leads from a 1000-2000 piece mailing is not a bad result for an hour to get the mailing ordered. (We had a direct response piece get 11%, but that was freakish, and not to be expected. Of course, we brag about it endlessly, like I just did again.)

This is a small mailing, to a high quality list. As you generate appointments, sales, and referrals, you’ll have made some money to keep the momentum going. Since you tracked your leads (Remember? You did, didn’t you?), you now have a “guide”…

Once the “commonalities” of your list are determined profitable, go get a list of similar demographics. A Mail List Broker (in the dreaded Yellow Pages or at www.amerilist.com ) can create a list based on the best respondents using combined income, age of home, education, and other parameters. This is a simple list to obtain.

In fact, this whole list is simple to do, doesn’t cost a bunch, and can generate a flood of leads when you need ‘em most… like now. Can you think of a reason not to get started? Let your marketing momentum begin!

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Click here to learn how lead tracking is one of 5 Scenarios That Can Yield Completely Different Results… every 15 seconds

Adams Hudson is president of Hudson, Ink, a creative marketing firm for contractors. For a free sample of our customer retention newsletter, call Hudson, Ink at 1-800-489-9099 or visit www.hudsonink.com for many free marketing articles and reports. To receive a free newsletter sample, fax the request on your letterhead to 334-262-1115.