Category: 3 Keys to Better Business

Who Are Your Customer Advocates?

Are you generating new business from existing customers? Customer advocates are the heart of any successful, growing business because they help send you referral leads – for free.

Referrals are warm leads that convert better than leads using other marketing initiatives. Creating customer advocates and harnessing their passion to drive more referrals is a key component to all successful, growing businesses.

According to a study by Wharton School of Business, 83 percent of satisfied customers are willing to refer products and services. But, only 29 percent actually do. So, let’s amp up that 29 percent and create some real growth from customers who share passion about the products and services you provide!

Why is customer advocacy so important?

  • A referral customer costs a lot less to acquire and has a higher potential for retention and loyalty. In fact, a referred customer has a 16 percent higher lifetime value. (Wharton School of Business, 2012)
  • Word of mouth is a primary factor behind 20 to 50 percent of all purchasing decisions. Its influence is greater when the products or services being bought are relatively expensive or need people to conduct detailed research. (Mckinsey, 2010)
  • People trust friends and family more than other information sources; they pay twice the attention to recommendations from friends than other sources. (Mckinsey, 2010)

It’s easy to understand why creating customer advocates is important in driving success. Here are four ways you can turn passionate customers into advocates.

1. Build stronger customer relationships

Building relationships is important in showing that you value your customers’ business. Stronger relationships increase trust between you and your potential customer advocate.

When it comes to referrals, your customer’s reputation is on the line. If someone recommends your products and/or services, and you don’t deliver, guess who loses? Yes, you might take a hit, but more importantly, your customer will have their reputation damaged. Through stronger customer relationships, you can build trust with customers and earn their referral.

2. Use customer satisfaction surveys to identify potential advocates

Identifying potential customer advocates is a challenge. Customer satisfaction surveys can serve as a tool to identify advocates.

As discussed in previous newsletters, these surveys give you the opportunity to ask customers what they really think of your service. To determine if a customer is a potential advocate, ask this question in your survey:

How likely would you be to recommend us to your friends or colleagues?

  • I would go out of my way to recommend <dealer name>
  • I would recommend < dealer name >
  • I wouldn’t recommend < dealer name >

If someone would ‘go out of their way to recommend your services’, you could assume they were very satisfied with your service or product. Leverage this insight to reach out to specific customers and identify potential advocates.

3. ‘WOW’ your customers by focusing on the experience

Zappos CEO Tony Hsieh demonstrates this best when he says, “We really don’t think that customer service is an expense that you should try to minimize, it’s really an investment in your brand. The telephone is one of the best branding devices out there. If you wow [customers] during that interaction, that’s something they’re going to remember for a very long time and tell their friends about.”

Creating an experience that WOWs your customers is something money can’t buy. People value service that goes above and beyond their expectations, and they tell others about those experiences. In order to WOW your customers, first think about what your customers expect from your product or service. Then, exceed those expectations. Think about some initiatives you can implement today that will make your customers say, “Whoa, that was great.”

4. Don’t be scared to just ask for referrals

Asking for a referral can be intimidating. Even with all the strategies in the world, some of you will still sit back and not identify your advocates and ask them for referrals.

Pick five loyal customers you feel might have some peers interested in your services. Next time you have a scheduled call or are delivering product, challenge yourself to simply ask for the referral.

Use this line if you’re stuck for words:“Hey Bob, do you know anyone or any operations that would find our products or services valuable?” 

Turning customers into advocates doesn’t have to be hard. Studies show that customers want to send you referrals but just don’t know how. Your passion for this industry is contagious, and you have customers who want to help you grow your business. It is up to you to leverage that passion to create more opportunity!

Marketing Multitasking

While many studies lay claim that multitasking can actually reduce efficiency, I will argue that ‘marketing multitasking’ is a no-brainer. Unlike mobile devices that are distracting and often prohibit productivity, finding ways to inject marketing into tasks you are already performing is quite the contrary. In fact, marketing multitasking is an excellent opportunity to multiply your effort.

You wake each morning with a standard routine that must happen in order to operate your business. You get dressed. You go over important tasks with your staff. You communicate with your customers during the sale, at checkout, and hopefully, you follow up. You invoice clients. Perhaps, you spend time driving to deliver product. You attend events, such as stock shows, where you simply visit and support your customers. Because you are accustomed to this routine, it is possible that you overlook marketing opportunities that can be easily injected into those everyday tasks at little to no cost.

Let’s touch on a few marketing multitasking ideas that can be incorporated into your normal business routine:

Staff Dress Code. You should never underestimate the value of apparel or wearables. Next time you are at the mall or large event, take a look around. Count how many shirts you see with brands like Nike, Under Armour, Carhartt and other popular brands. You’ve just been marketed to – many times over. Outfitting your staff with branded apparel creates walking advertisements for either your company and/or the brands you represent. Clothing can be used as conversation starters and magnet for potential customers, and they work overtime! How is that? If you invest in attractive apparel that your employees or customers like, they will wear them everywhere, even when you don’t ask. Being strategic about getting dressed in the morning is a cost effective, fun way to market.

Invoices. For dealers who snail-mail to send invoices or statements to customers, consider adding a product stuffer to the envelope. This is a small piece of paper designed to fit perfectly in an envelope and tells your customer about a new or related product they could benefit from. While you’re spending money on postage, you might as well include something that could spark interest and generate additional sales. For those who utilize electronic billing systems, you can also take advantage of this by attaching a PDF flyer in your email or, better yet, including a coupon for your customer’s next purchase.

Checkout Chatter. The short period of time a customer stands at the counter to check out is a perfect time to introduce them to upcoming promotions, new products or simply ask them if they are satisfied with the customer service they received. It’s the perfect time to up sell or receive feedback on their experience.

Vehicles. As a feed dealer, it is a given you spend much of your time on the road or have a vehicle out and about on any given day. A great way to increase brand awareness is with a vehicle wrap to advertise your dealership or a magnet that has your contact information, creating a traveling billboard.

Show Sponsorship. You will likely attend a stock show at some point throughout the year, whether with your family or to support your customers. While you’re there, wear your branded apparel and consider a sponsorship of product for class winners or champions. Ask if the show will announce your sponsorship over the microphone throughout the event and let people know where they can purchase product. Signage at these events is always a great way to increase awareness, and depending on the event, can come at a low cost.

Employee Time. If you have employees who have some downtime throughout the day, ask them to utilize that time writing thank you notes to your customers. You can never thank your customers enough, and a simple note will pay dividends.

As business owners, you face two important challenges each day:
1) feeling as if 24 hours is not enough to get everything accomplished and 2) engaging with your customers on a level so they know they are important and that you care. Our world is becoming more demanding of our time, and communication space is more cluttered. Rather than revolutionizing your marketing plan and falling short because you don’t have the time or resources to pull something big off, evaluate current activities to know if you are being fully efficient in the tasks you are already performing. And, more importantly, understand your customers’ worlds are just as cluttered as yours. Personalize your marketing efforts to speak to customers about what specifically interests them. By respecting their time and catering to their needs rather than cramming them into a one-size-fits-all plan, you will create engaged customers who appreciate your effort and who will remain loyal to your business.

Accounting Software Increases Awareness & Efficiency

Accounting is the language of business. Not having accurate accounting information is like trying to get on the right train in Tokyo when you don’t speak Japanese. In the end, you will be lost and unsure of your business’ financial footprint.

Whether you’re just opening up shop or you own a thriving business, accounting software can make your life easier and save you hundreds of hours of time and stress. The best accounting software can perform most accounting tasks, such as keeping track of expenses and daily transactions, paying bills and employees, sending recurring invoices and syncing data across financial accounts. There’s no substitute for an accounting pro who knows the ins and outs of tax law, but today’s packages can help you with everything from routine bookkeeping to payroll, taxes, and planning.

When Business News Daily asked small business owners what made the “perfect” accounting software, there was one resounding requirement across the board. The best accounting software saves business owners time and doesn’t add to the already stressful nature of owning a small business.

The good news is there are more accounting software options than ever, including subscription Web-based options that don’t require their users to install or update software. Many businesses, however, including those that need to track large inventories or client databases, and those that prefer not to entrust their data to the cloud, may be happier with a desktop tool. Below are four of today’s favorite options among small business owners:

  1. Wave is a free, easy-to-use program that also has some surprisingly strong accounting and invoicing tools.
  2. Gusto ($29 per month) is inexpensive, has a simple and attractive interface, and incorporates the payroll tools most often required by small businesses.
  3. FreshBooks (from $19.95 per month) is exceedingly friendly, understandable, and attractive. FreshBooks is the site to beat when it comes to managing and tracking invoices, time and expenses for the very small business.
  4. QuickBooks Online ($39.95 per month) is a cloud-based accounting application that includes the most comprehensive set of features for small business. It’s easy to use, aesthetically pleasing, and has numerous integrated add-ons. QuickBooks can also be purchased as a desktop install.

Purchasing the right accounting software and then using it is one of the most important ways to know the financial state of your business. However, if you don’t take the time to extract information from the software, analyze that information and then use it to make decisions, the software is just another wasted purchase. Without knowing how your company has performed financially, it is impossible to predict where it can go. In addition to reviewing the monthly financial statements (profit and loss and balance sheet), consider adding these four items to your think time:

1. The Quick Ratio (> 1)
By definition, the quick ratio is found on a company’s balance sheet and is the business’ current assets (cash and accounts receivables) divided by its current liabilities. A favorite metric of every bank when considering a loan, the quick ratio is a measure of the financial stability of a business. It shows that the company has more cash available than the short-term money it owes. In most industries, a healthy quick ratio should be greater than 1.

2. Top 10 Customers
While all customers are important, not all of them are created equal. Who are the 10 most important customers that contribute to the success of your company? This is measured not only by revenue, but also the additional products they buy. In many companies, these top customers contribute 70 to 80 percent of the total revenue. Remember, it is typically easier to sell more to these established customers than find new ones.

3. Days Sales Outstanding (< 133%)
Days sales outstanding (DSO) is the average number of days it takes for customers to pay. The smaller the number, the better, since the business can use that cash more quickly. The number should be less than 133% of the payment terms with a customer. For example, if terms are 30 days, the DSO should be 40 or less. DSO can be improved by giving out less customer credit or collecting payments more quickly.

4. Operating Cash Flow (> $1)
How much positive operating cash flow did the business produce last month? Profit is important, but cash flow is king. By definition, cash flow is simply the sum of your monthly profit and any changes in accounts payable, accounts receivable and inventory. The higher this number is, the healthier the company is.

Striving to make smarter and more profitable decisions is the basis of financial success. Having an accounting system and using it to make those decisions is a great start.

Know Your Customer :: Target Their Interest

Diversity is all around us. And with the diversity available within the BioZyme® product line, your customer base could include a family who feeds lambs and goats for a seasonal show circuit, someone else who is a fifth-generation purebred cattle producer and another who breeds prize-winning show dogs. 

Obviously, with such a broad spectrum of potential customers, your marketing plan can’t be a one-size-fits-all. Just as it is essential to know details about your customer, it is just as important to know how to provide a unique marketing approach to fit each customer’s needs.

According to a University of Kansas “Community Tool Box” website
(http://ctb.ku.edu), market segmentation enhances your ability to best use the four P’s of marketing: product, price, place, and promotion.

  • PRICE: Price comes in different forms. A customer may be willing to pay a premium for quality if that is something you know is important to them (see page 8 for an example of how CJ Feed & Supply obtains this information). At the same time, a customer may be willing to pick up product versus having it delivered if they desire a lower cost.
  • PRODUCT: Knowing and understanding customers need different products for their various species and goals will allow you to have a more personal conversation, whether that be in person or through marketing efforts.
  • PLACE: Different customers can be reached in different places. Perhaps you have a customer who wants you to call them on a regular basis, while another appreciates a personal visit to his or her operation. A group of customers might benefit from an email that highlights upcoming price changes for products you know they use regularly, and another group might appreciate the
    opportunity to attend a producer meeting.
  • PROMOTION: Each customer responds differently to
    marketing and advertising. As mentioned in previous
    newsletters, the BioZyme marketing staff has tools
    (email, direct mail, texting, signage, etc.) and resources
    available to help you reach these customer groups.
    Contact Katie Vaz, Marketing and Communications
    Manager, at kvaz@biozymeinc.com or 816-596-8782  for more information about which marketing tools are available and best suited for you.

Since you know your customers best and their specific needs, it is important to be able to relate to their needs. Is breeding season approaching in your particular region? Perhaps you begin heavier promotion and offer education on the benefits of Concept•Aid®. Do you have several customers who show pigs during a summer jackpot series? It might benefit you and those customers to attend the first show of the season to promote Vita Charge®.

Targeted marketing quickly shows each customer segment that you care about their specific needs and have the products to meet those needs. This type of marketing positions you as a specialist in  the eyes of your customer and encourages  them to seek you out when they have a question, problem or product request. This relationship-building marketing strategy will draw your customers closer to you and make them more willing to invest in you and your products instead of your competitors.