Marketing Mistakes 4 Ignoring Customers, No Referral System

This is part 4 of my Common Marketing Mistakes series of articles inspired by Jay Abraham.

So far I have covered six mistakes (and I've provided the links to take you straight to the three previous articles.)

1. Inadequate market research
   
2. No unique selling proposition or USP
3. Not measuring the results of your marketing
4. Not using direct response advertising
5. Not testing
6. Not knowing the customer lifetime value

and today we will add two more to the list:

7 - Focusing all of your attention on new customers

8 - No customer referral system

Putting New Customers Before Your Existing Customers

I believe that your customers are your greatest asset but too often, businesses focus on attracting new customers at the expense of their take-for-granted loyal clients.

I often see special deals to lure new people into the net with special "new customer only" deals but how do you think that makes your existing customers feel?

Banks and building societies are particularly bad at it as they offer much lower interest rates to new borrowers than to existing customers.

It's not fair and it causes customers to be cynical about the company who relies on customer apathy to make money. It rewards customers to switch accounts at considerable inconvenience and that's not good for them or you.

So how do you show your appreciation and thank your existing customers?

Do they enjoy special privileges like special events or first refusal on a scarce product? Do you give them preferred terms of some bonus items? How do you make them feel special?

I would like you to start seeing your customers as a great opportunity and source for hidden profits. They know you, they put up with you and if you treat them right, they can buy more and more often.

Remember Jay Abraham's three ways to grow a business model:

1. Increase the number of customers
2. Increase the average transaction value
3. Increase the number of transactions per year

Fundamental to the last two factors is growth with your existing customers and that can only happen when they are treated fairly and delighted with your product and service.

Not Having A Customer Referral System

Word of mouth recommendation is probably the most successful lead generation approach. It is low cost, easy and your potential customers are predisposed to buy from you.

An advert or a salesman can tell you that "Bloggs widgets are the best money can buy" but because this is the company talking, the messages are biased with such a strong incentive to sell you on the product.

It's much more credible when someone you know and trust and who uses the company regularly tells you that you should buy Bloggs widgets because they really are the best.

The easy way is to just wait for customers to tell other people they know about the fantastic products and services you offer. The problem is that you might be waiting a long time.

We all have too much to think about and unless someone comes along and says "I'm having terrible problems finding a reliable widget supplier. Is the one you use any good?" your best customers won't think about recommending you.

It's not that they don't want to help you out. They just don't think about it because they are so wound up in their own lives.

So you need to have a referrals system where you can prompt your customers to give referrals regularly. They understand what's in it for the prospective customer, you and themselves.

Giving referrals is a nice thing to do. It's good to help people you like and if that means playing matchmaker where one action can help two people, then it is great.

There are many different systems that you could use and Jay Abraham has identified 93 referral systems (affiliate link) from his seminars and workshops.

Conclusion

So there you have it - eight common marketing mistakes which cost a fortune in lost opportunities and profits.

I firmly believe than in many businesses the are hidden pockets of profit, just waiting to be found by someone prepared to try a few new marketing ideas.

If you are in central England I'd like to think that you would give me a call but elsewhere I can recommend Jay Abraham's Mastermind Marketing System  (affiliate link) (a set of six audio CDs from Nightingale Conant which was responsible for my Jay Abraham addiction).

If your budget is modest but you are looking for a  more comprehensive solution with a strong focus  on practical implication, then I recommend Scott Hallman's Small Business Growth Club. (affiliate link) The more I work my way through this system the more impressed I am by:

a) the sheer quality of the material included

b) how easy Scott makes it to start applying the profit building techniques and

c) how he offers it for such a low price.

Business will get much tougher over the next year or two so it is much better to start applying these techniques to deliver higher results from your marketing now than to wait for performance to decline.

Don't miss the opportunity to download a free 35 page Jay Abraham PDF called the Windfall Profits Paradox