My hairstylist's schedule is always packed. When we got to talking about her business during my last appointment, I suggested that her success was probably driven by the fact that she gives customers just what they are looking for and provides a consistently quality service. Turns out, I was wrong.
Cosmetologists, like many service businesses, get a large share of new customers from referrals. And while most of my stylist's customers come in for a regular cut or color and are happy with a consistent result, very few of them drive referrals because the end result doesn't really stand out. The real growth opportunity comes when someone walks in and either wants a radical change, or is trying to fix a cut or color gone bad.
This is where you--as a small business owner--have a huge opportunity to not only lock in a new long-term customer, but also to turn that customer into a new-business referring machine. When you create something new--whether it's a hair style, a home landscape or a professional website--you become the expert on that creation and are in a trusted position for follow up maintenance and improvement.
Below are five tips to not only create long-term customers, but turn them into new-business referring machines.
1. Look for the right cues.
Not every customer presents an opportunity to introduce a drastic change or improvement. But business owners who thrive on referrals should be attentive to cues that the customer would be receptive to taking their project--whether a hairstyle, front yard lawn or website--in a fresh direction.
Work a few suggestions into the initial discussion, or even consider discounting what are typically more extensive services if you feel like they will have the impact required to make this customer a valuable source of referrals.
I've seen this play out particularly well with web designers who may have been contacted to add a few features, but see an opportunity to have a much larger, and highly visible impact, by adding those features to a broad redesign. Sometimes the redesign may even be done at a discount and viewed as an investment in a long-term customer who will likely provide valuable future referrals.
2. Don't forget to bring up referrals.
Letting customers know that you'd love to hear from any of their friends, family or neighbors who might be looking for a similar service is the first step in getting them thinking about referring someone to your business. It might be an obvious step for some, but it's an important one that you might forget to do more often than not.
3. Leverage low-cost opportunities.
There's nothing new about referral programs. Many a small business has based their success on some tried and true methods--and there are very-low cost ways to encourage referrals.
For example, provide customers with a couple of business cards with their name scrawled on the back. Tell them that any friends who bring in the card or mention their name will get a discount. The discount doesn't need to be large, just enough to further encourage an already satisfied customer to spread the word.
4. Make sure they know how much their referral is appreciated.
To create customers that refer people to you on a long-term basis, make sure they know how much you appreciate their efforts. From a handwritten note card to $100 gift certificates to a local restaurant, the key is that you make a concerted effort to express your thanks.
I've seen this strategy used to great effect--with a gift certificate to a local restaurant, for example. It avoids having to make any assumptions--like giving wine might--and it creates an opportunity for your satisfied customers to dwell a bit longer on the project, all the way though dessert.
5. Invest in the before and after shots.
With social media now being the ubiquitous word-of-mouth, small businesses have an opportunity for even greater outreach. But where many of these efforts fall apart is with a lack of planning and poor attention to detail. You may have just completely a very big project for a customer, but without the right content (like before and after photos or details of quantifiable improvement), your social posts will lack impact and simply won't get shared.
Be sure to always keep your ears and eyes open when new customer come in and tell you they learned about your business from a friend's post on social networks. A quick "thank you" or small reward to that first customer could prompt another round of posts into their social groups, and another set of referrals.
Before you know it, you'll have new business walking through your door looking to have green hair turned blonde, brown lawns turned green, or websites radically updated from blah to beautiful.