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Marketing mastery: The 5/45 dealer

February 16/23, 2015; Volume 28/Number 17

By Jim Augustus Armstrong

(Second of two parts)

Screen Shot 2015-03-06 at 12.11.03 PMI presented two seminars at Surfaces in January and I asked both audiences if they were marketing to their past clients on a monthly basis. Out of 300 attendees, only about 10 dealers answered yes. Besides helping you make a ton of money, marketing to your past customers will create huge differentiation from your competitors.

I suggest dealers use a printed, “snail-mail” newsletter. Have it contain 80% fun, informative and general interest information with only 10% to 20% flooring-related information. Some emotional triggers that will make your newsletter more effective include a trivia contest, acknowledging new and returning customers, promoting your referral program, calling out customers who sent you referrals and a “customer of the month” article. Black print on colored paper works extremely well because it looks more personal than something slick and glossy.

Mark, a dealer from Chicago, went from nearly closing his doors to being booked out for several weeks about six months later. He implemented a number of strategies to make this happen, but a monthly past-customer newsletter was his main marketing method.

Create a weekly e-newsletter as a supplement to (not a replacement of) your printed newsletter. It should contain a single 150-to-200-word fun, general interest article that has nothing to do with flooring. At the end include a short blurb about your flooring business.

Next, develop a robust referral marketing system. In comparsion to walk-ins, repeat and referred customers are easier to close, easier to command premium prices from and just easier to work with overall. As a dealer you’re doing anywhere from dozens to hundreds of installations per month; this represents a huge marketing opportunity to get instant referrals.

Visit each home after the installation. Surprise your customer with a gift basket, inspect her flooring and then ask for referrals. I recommend creating a form that describes the benefits of your referral program such as a reward for any referral who becomes a customer or an offer for a gift certificate to your store. Explain how she will be doing her friends and relatives a huge favor by referring a trustworthy dealer. For this to be most effective, ask for the referrals in person. If your installer simply leaves a referral form behind, very few people will fill it out and mail it in.

If each RSA generates two extra referrals per week and your average ticket is $3,000, that’s an extra $312,000 annually per salesperson.

You should also develop referral relationships with realtors, designers, remodeling contractors and carpet cleaners. To establish these relationships, first send them a letter introducing yourself and your business. Follow up with a call to schedule an appointment for coffee or lunch. You can also establish relationships by joining networking groups.

Once the working relationship is established, nurture the partnership by putting your connection on your newsletter list. Call or meet with your referral partners every month or two. Leave business cards at their places of business. Periodically bring lunch or other goodies to them and their staffs. If you have 20 businesses sending you four referrals per year (a very conservative number), that’s an extra 80 sales per year. With an average ticket of $3,000, that’s $240,000 in revenue with no marketing costs. Want even more revenue? Add another 10 referral partners. Millions of dollars in revenue can be generated using just this strategy.