AskPat 426 Episode Transcript

Pat Flynn: What up everybody? Pat Flynn here, and thank you for joining me in Episode 426 of AskPat. As always, I'm here to help you by answering your online business questions five days a week. We have a great business question today from Nick, but before we get to Nick's question, I do want to thank today's sponsor first up here at the beginning of the show.

Lynda.com, an amazing company, the best online learning platform with over 3000 on demand video courses. These aren't just homemade videos. These are super high quality studio videos to help you strengthen your business, technology, and creative skills. Everything from learning how to use new pieces of software that you've never used before or even update software that you already use to fundamentals and growth hacking and business expansion and income tax, HR, all those sorts of things going, paperwork start to finish, a ton of stuff on there. The cool thing is if you want to see if there is anything out there for you, I recommend going to Lynda.com/AskPat because you can get a 10-day free trial, all access to all of these on demand video courses, and you'll see they're great. Lynda.com/AskPat.

Alright. Here's today's question from Nick.

Nick: Hi Pat. My name is Nick, and my question is about taking a business that has been pretty much solely dependent upon referrals and turning it into somewhat of a scalable, more predictable business. I work with a custom home builder here in my area. For the past ten years, we've pretty much been getting all of our jobs off of referrals. We're looking to make the lead process and the prospecting process a little bit more predictable with some online and offline marketing. I wanted to get your initial thoughts on some ideas you would have for starting to convert cold traffic into leads for this custom home building company and also how we can take and nurture the current clients and past clients that we have in order to generate even more referrals from them. Thanks Pat. I really love listening to your stuff.

Pat Flynn: Hey, what's up Nick? Thank you so much for the question. I really appreciate it, and it made me think a lot because I'm not in obviously the same niche that you're in. I used to be an architect and a little bit familiar with the space and how things work, and I do understand how referrals can be a major part, and obviously it's been the way that you've been able to build your business. First of all, I just wanted to say there's nothing wrong with that, obviously it's working, it's great. I understand your wanting to scale and try other things, but first let me answer the second half of your question, which is: How do you get more out of the people who are already referring for you and your existing customers? That's where you want to start.

This is a strategy that's already working, the referral thing. Let's take that up a second notch to a second, third, fourth notch. You always want to start with what's working and optimizing that before you move on to something else. This is just a strategy that I've learned that has just made the most sense to me over the last couple of years. Take what's already working and make it even better before you try and start something completely different. That's where I would start, which is why I'm going to start with the second half of your question. How do you get more out of the referrals or the existing customers that you have?

There's a couple of things that you could probably do and implement. That is, if you haven't done so already, create systems to reach out to these people after a certain period of time. Your existing customers, people who have referred you before, and those types of things. You want to make it automated. That way, it just happens automatically for you, and it becomes this passive thing where you can focus on other parts that do require a human touch or human interaction to make it even better.

Automated. What I mean by that is maybe you get a customer, and you know . . . and you have it in your system to make sure that a month later after they're in their home and they're satisfied, you reach out to them and you collect testimonials, what not, and you see if they'd be interested in referring your service to everybody else or to anybody else that they had. Again, making that reminder there and whether it's an automated email that goes out to people, that's one strategy. Or just a notification for somebody on your team to go ahead and reach out and have a conversation. Or maybe, you could take that even further and actually invite those people out to a coffee or something just to make sure they're satisfied, but then you could drop in the conversation that this is the referral program we have and all those sorts of things.

Speaking of, I don't know much about the referral program you have and what exactly is involved, but I'm really big on affiliate marketing. This is . . . referrals is essentially becoming an affiliate, in a sense, where you would be getting a commission or sort of a head hunter's fee for people who do refer you to everybody else. It might be $100 bucks per referral or probably more than that in your space. Do you know what I mean? Tesla is actually doing this now. Tesla has a referral program. If I have a Tesla, which I hope to have one very soon, I can refer Tesla, the company, to you, Nick, and if you go and get a Tesla, I get $1000 and you get $1000 off. That's a pretty cool model.

This Elon Musk guy, who is my hero right now, he's pretty smart. He kind of knows what he's doing. I love the way they're shaking the automotive industry. This customer-to-customer referral program is really, really cool. You can use a strategy like that as well. The savings on the customers end isn't usually there in online business affiliate marketing, but I know for things like vehicles and the Tesla example, and even in home examples . . . I don't know if you're doing this already but if somebody refers you for example, they get a check or a cut, and the person who was referred also gets a savings as well. That way, they continue to follow through with it and all those sorts of things.

To continue this conversation about the customers that you have and referrals, make sure you reward your top referrals, your top affiliates, your top people who seem to be driving you the most business. You want to make sure that they're happy and that they know that you are thankful for the work that they're essentially doing for you. When you have people under you who are referring or are an affiliate for you, they are essentially the marketing team you never have to pay unless it's commission, but it's not like they are working hourly for you or anything like that. It's an amazing deal. You better make sure come Christmas time, for example, you send them a basket of chocolates and flowers and that sort of thing. Or you call them out of the blue, just to make sure they're good and okay. You invite them out to dinner just because they're amazing. All those sorts of things go a really long way.

Obviously, you could do that with everybody, but I would just do it with your top 10 to 20 percent, and that's what's really going to happen when you start to see these referrals come in. 20 percent of the people who are referring you are going to generate 80 percent of the results for you. Get those 20 percent, treat them like they're everything in the world because they are. Again, that's another strategy. Another thing is making it super easy for them, for your existing referrals or referrers and your new customers who will become referrers. Make it incredibly easy for them. Hopefully easier than how to say that word. Make it easy for them to become one, to be able to, for example, have an email copy that's ready for them to swipe and send to their friends. Or have pamphlets that they can have in their home that they can give to other people. All those sorts of things.

When you make it easy for your affiliates, when you make it easy for the people who are referring your company for you, you have a higher chance that they're going to be able to move the needle for you. That's the last thing. Number five is just of course something I've already touched on. Keep building those relationships. That's really where this comes down to. That's the most powerful thing in the world are these relationships that you build. That's going to account for a ton more business over time. The more you create these relationships. That can mean going to conferences and meeting new people, and you might find some influential people who actually have a lot of people that listen to this person. We live in a day and age now where there are a lot of people who you can connect with who have large followings, large Twitter followings, YouTube channels that can potentially share your business and refer your business to their audience. Keep those things in mind as well.

Going back to lead generation, if you want to do something a little bit more outside of the referral strategy, which of course is always going to be there, especially with these people who are coming in in this new format, they will go down that same process like I had just talked about. There are three things I can talk about here that will help you, and I'm not going to get deep into them because they are deep topics. First of all you can run Facebook ads. Facebook ads are great because you can get incredibly targeted with everything from location to interest to income levels, and you can target the people who perhaps are within a certain phase of their life where they might be moving into a new home and things like that. That's really cool.

Number two, live events. You can hold live events. I know a lot of people do this in at least in San Diego. I always hear about these live events that people throw on which is essentially a lead gen live event, where it just makes sense for these higher ticket items to get people in a room to not just motivate them and pump them up but also show them the truth and the reality of what it is they can get and being honest up front of course, which isn't always the case but that's what I would recommend. Then, you can close people while there or actually, at least, get them interested in what's going on and that sort of thing.

Number three, content marketing. Content marketing is huge, and it's a way for you to build a brand that people can come to trust with information that is actually helpful, so that when it is time to make that decision to work with a company like yours, they will go to nobody else but you. If you want to follow a cool person who does a lot of great content marketing, you should follow Marcus Sheridan over at TheSalesLion.com. That's who I would recommend you follow for content marketing if you're just getting started. He's done it in a great way with his pool company and is really inspiring. It just shows anybody can really do it, and Marcus does it right. There's obviously a lot of people out there who do really well with content marketing as well, but I would definitely recommend you check that out.

Facebook ads, great systems. The cool thing about that is you'll eventually get to a point where you know how much money you're putting into it, or how much money you're getting out of it, or how many leads do you need to pay for before you get a close, and that sort of thing. It becomes systematic, and you end up trading dimes for quarters. You put more dimes in the machine and get more quarters out of it. That's kind of what Facebook ads is like if you get it set up correctly. It is very difficult, and you can find somebody to help you, and I've lost money on Facebook ads before, but just keep that in mind. Number two, live events is bringing people together in person. And number three, content marketing, so creating stuff that people want and are looking for and being that person, that company, that resource that actually answers those questions and becomes that trusted advisor in people's decisions to work with companies like yours.

Nick, I hope this answers your question. Thank you so much. I'd love to hear from you. Give me a shout out @PatFlynn on Twitter if you hear this. I appreciate it, and I appreciate all of you who are listening to this. Nick, thanks for the question. We're going to send you an AskPat t-shirt for having your question featured here on the show. You'll hear from Jessica, my assistant in the next couple of weeks so we can collect your information for that.

I also want to thank today's sponsor, which is the second sponsor of the show, which is Braintree. This episode is brought to you by Braintree. If you're working on a mobile app for example and you're searching for a simple payment solution, check out Braintree. This is a payment solution that it connects with companies like Uber, Airbnb, Hotel Tonight, Living Social, and GitHub. They made the payment experiences in these apps seamless and almost magical. If you have an app or a company or startup that is looking to find the payment process that just works, you've got to check out Braintree. To learn more and for your first $50,000 in transaction fees free, go to BraintreePayments.com/pat. Again, that's BraintreePayments.com/pat.

Alright. Thanks so much. I appreciate you, all of you, all your questions. If you have questions you want potentially featured on the show, head on over to AskPat.com. You can ask right there on that page.

To finish off the show like I always do, here's a quote from another commencement speech like yesterday's from Jeff Hoffman who is the founder of Priceline at Bradley University. He said, “I am telling you to make a choice based on your passions and interests, not what everyone else is telling you to do. It doesn't work that way. You wind up living a life for the wrong reasons, and you never get the most out of it. Always think about why you are doing what you're doing.”

That's my question to you to finish off the day. Why are you doing what you're doing? Take care, and I'll see you in the next episode of AskPat. Bye.