Greetings Flooring Dealers!
In this installment we’ll cover the “After” phase of your client relationship.
After
This phase takes place after the sale and installation are complete, and is the most profitable phase of the relationship. Ironically, as profitable as this phase is, most floor dealers ignore it.
QUESTION: “Wait a minute, Jim. How can ‘after’ be more profitable than the actual sale?”
ANSWER: Because of Lifetime Value of the Client (LVC).
Most dealers believe the purpose of getting a new customer is to make a sale. Savvy marketers realize that it’s the other way around: the purpose of a sale is to get a new customer. Savvy marketers realize that the lion’s share of the profits are in the back-end of the client relationship. In other words, most profits are realized after the first sale is made. Here’s an excerpt from my “60-Day Rapid Launch” program that explains why this is so:
Lifetime value of a client
Relationship oriented vs. transaction oriented
Most business and employees are transaction oriented. They only consider the value of a client during that single transaction. You are going to learn to be relationship oriented and understand the lifetime value of a client.
Lifetime value is what a client is worth to your business over the course of our relationship with that client, and you should base all our decisions on this philosophy. This represents a small but powerful shift in thinking. Here’s why:
Let’s say your store’s average gross revenue per transaction is $5,000. Most companies will see a client as worth $5,000. Here is how you should view the value of a client over 7 years:
Initial transaction: $5,000
Referral during that transaction: $5,000
Second referral during the interim 7 years $5,000
Second transaction (people replace flooring
every 7 years on average) $5,000
Second referral during that transaction: $5,000
Lifetime Value $25,000
And that doesn’t even include the referrals that the referrals generate. If you include those, the true lifetime value could be as high as $50,000 to $80,000. Therefore, each and every client that walks through your door is worth anywhere from $25,000 to $80,000. So treat every client like they are worth $25,000 to $80,000, because in reality they are.
This is why it’s so critical that you have a system in place to nurture the client relationship during the “After” phase. Using a monthly newsletter (not a “snooze-letter) that contains 80% fun, informative, entertaining, value-added content, along with 8-10 reader-involvement devices or emotional “triggers” is a powerful strategy for nurturing the “After” phase. The other 10%-20% of the content can be dedicated to flooring.
(Why only 10%-20% dedicated to flooring? Because in any given month, only a small fraction of your database will need flooring, so don’t bore them with 100% flooring content. You want to keep them interested in reading your newsletter even when they are not in the market for flooring so they will send you referrals, and so when they DO need flooring they’ll visit your store instead of Home Depot.)
My Inner Circle Club members have access to the “Home Advisor” past client marketing newsletter that has all of these elements. It’s a totally turn-key, plug-and-play marketing tool that’s delivered monthly to my floor dealer clients, and they are getting awesome results from it.
To Tons Of Customers!
Jim Augustus Armstrong is The “Coach”
Jim Augustus Armstrong is the President of Flooring Success Systems, a program that equips dealers to double their profits, cut their work hours in half and beat the boxes! Many dealers have totally transformed their businesses and their lives for the better after joining Flooring Success Systems.
See what real, live dealers are saying!