When I was younger I did web marketing for a guy who sold speakers. His business model was to import, the cheapest OEM speakers he could find, and resell them for a huge profit under his private label. We spent a lot of time and marketing dollars chasing new customers there. He had horrible customer satisfaction and less then 2% of his customers reordered. Eventually he went out of business and I lost my job, but I did learn a great lesson in product value.  If he had spent just a little more money on building a better product, he would have retained more of his customer base, and would probably still be in business today.

At the Leedom conference in Las Vegas Chuck Bonanno said something that really made me think about those days. He said “It’s all about building a better product, but in the Buy Here Pay Here industry your product is your customer experience not the vehicle.”  There is tremendous value in capturing that customer loyalty and best part is the only “investment” needed is a little time and attention.

By focusing on these areas you can really maximize your repeat and referral business:

1.) Give them something to talk about. Yes cold hard referral cash is a good motivator but the real key is having a staff committed to providing a great customer experience. You can wave all the money you want at your customers, but if they have had one bad experience you can kiss any hope of them ever referring someone goodbye. Having a cashier that has a bad attitude or a salesman that ignores customer problems can get expensive real quick. Make sure you pay attention and address those kinds of personnel issues. Employing a customer complaint hotline and satisfaction surveys are a good way to monitor how your employees are treating your customers. Overall it’s the little things that create a good experience. Do you have magazines and coloring books in your waiting areas? Or set out goodies for the holidays? Do your employees tell your customers on a regular basis they appreciate their business?   If your dealership is anything like ours you probably bend over backwards everyday for your customers. When a customer gets a special treatment do you make it clear you went above and beyond? Or do you leave them to just expect it the next time? It never hurts to make someone feel like you did something special for them, even if you really didn’t go that far above the norm. Train your staff to utilize power phrases like “Typically they don’t do this, but since you’re one of our best customers” or “I really went to bat for you” or “This isn’t going to be easy, but I will work my hardest” or “I am so excited I was able to get this exception, you really deserve it”

2.) Ask for the referral. That may sound like a “duh” statement, but are your employees really asking for referrals?  I’m not just talking about the salesman at the close of a sale either. When you collector makes a payment arrangement with a hard up customer, do they remind them how they could make a few extra bucks by referring a friend? When your service manager fixes something that you normally wouldn’t cover, does he/she ask for a referral? Catching your customers when they feel more obligated to return a favor is a good way to get them signed on to a give and take relationship. Create a company culture where customers who refer friends and family are highly regarded and even given special treatment. Don’t be shy about letting your customers know why they got that special treatment and encourage them to continue the behavior. On the same token, gently remind customers who have not yet referred anyone that they have yet to reach this “exclusive status”.

3.) Back it up in writing. If you’re not touting “Refer a friend and get $100 cash” on every piece of marketing material you have, then you are seriously missing the boat. Referrals aren’t just limited to current customers either; prospects make good referral foot soldiers too. Is the phrase “refer a friend” on your business cards? Your follow-up mail? Your website? Is it on your Christmas and birthday cards? Your Print ads? Your hold music? Is it on every email that your employees send out? Is it hanging in nice little frames at every sales desk, in the finance office, and by the payment window? Maximize your repeat and referral opportunities and you will increase your business without spending one more dollar in advertising.