How to Turn Your Existing Clients into a Sustainable Growth Engine With Jay Goncalves

Episode 44 How to Turn Your Existing Clients into a Sustainable Growth Engine With Jay Goncalves
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[00:00:00] Jay: Next time you get to interact with a client, it doesn't matter if they have been working with you for four weeks, four months, four years. Ask them a very simple question Where do you see your life in the next six to 12 months.

[00:00:13] Jay: Just ask him that very simple question. 'cause that question will let you know where the desire. Is there is one key thing in marketing that most people learn when they learn marketing. We don't create desire, we channel desire. So when you are able to ask those clients where their brain is at for the next six to 12 months, you know where the desire is

[00:00:33] ​

[00:00:39] Allan: Welcome to the Lean Marketing Podcast. I'm your host, Allan Dibb. Today I've got a special guest, Jay Goncalves, and Jay is a specialist at retaining clients. Now, we talk a lot about at client acquisition at Lean Marketing. You know, how do we get new clients? Really, if you have a look at the one page marketing plan, and if you have a look at a lot of the work we [00:01:00] do, we talk about increasing customer lifetime value, which is really where the money is made.

[00:01:05] Allan: And today, Jay and I, we're gonna be talking about exactly that. How do we retain clients so that we get a much higher client lifetime value? And so that we have clients who absolutely love what we do. Wanna stay with us, want to refer more to us and pay us a lot more? Welcome to the podcast Jay.

[00:01:22] Jay: Glad to be here. I was just super excited for our conversation today.

[00:01:26] Allan: Me too. So Jay maybe give us the, a couple of lines about you. Who are you? Why should people listen to you, and what are we gonna talk about?

[00:01:35] Jay: Well, I'm trying to keep it short 'cause I've done a lot of things through my whole life. But my name is Jay. I was born in Portugal. All my upbringing was in Portugal up to my 22 years old. Yeah, I was 22 when I started working as an engineer. So I was a system engineer for 10 years. I worked in multiple projects around the world.

[00:01:58] Jay: It taught me a lot about [00:02:00] high stake projects. My last one was the World Cup. In Qatar, I was overseeing a hundred million dollars for the data network to support the subway that was built specifically for the World Cup. That was my last project halfway through my journey. I. There was a bug that you guys all know, the entrepreneurial bug that beat me, and I started building a parallel side business.

[00:02:24] Jay: Started growing, going really well. Started to apply some of my love for systems and also some of my love for psychology on how could I work in my separate business, retain clients for as long as possible, so I didn't need to chase new clients. I was able to build that business to a point where I was managing 150 clients myself with my day job was crazy.

[00:02:46] Jay: I don't recommend doing that. Uh, But I learned a lot by going through that and decided to go all in on being an entrepreneur. Halfway through that journey as an entrepreneur, I understood there was a big need for people. To build those [00:03:00] systems, but I'm seeing systems that are based on psychology as well.

[00:03:03] Jay: How can we better understand our clients? How can we better retain our clients so that we build a sustainable business? I think that the word that is the most relevant to me, it was sustainability. I've seen plenty of businesses starting being around for. A couple months, a year, two years, and then they're out of business because again, acquisition is important, but acquisition is only one piece of the puzzle.

[00:03:25] Jay: When we can understand how we can increase LTV through other solutions and mechanisms, we literally compound the potential growth of a business.

[00:03:34] Allan: Yeah I totally agree. I mean, we see the leaky bucket everywhere, where people are pouring new leads in, they're closing new deals, but you know, clients are maybe not getting the results they wanted or expected, and that's not necessarily because the product or service is bad. It's often because in the sales process, the expectation.

[00:03:53] Allan: Delivered is not what's actually being delivered as a product or service. And maybe there's a mismatch in either [00:04:00] communication or what the client expected or whatever else. So I'd love to hear some of the most common issues that you find in your work. So, what are the things that kind of.

[00:04:11] Allan: Create churn leak clients create complaints or dissatisfaction because I often see business owners deliver awesome products, awesome services, but they do have a retention problem. Very often they have a churn issue or whatever. And I'd love to hear from your experience, what are some of the key levers that you can pull to reduce churn and increase client satisfaction?

[00:04:34] Jay: Cool. So there are five big things that are super connected. So if you think about scaling a business. There are only three things we need to keep in mind apart from acquisition. Acquisition is key. If you don't have acquisition, you don't have a business. But assuming that acquisition is in place, you have marketing, you have a sales system churn, you need to make sure you.

[00:04:54] Jay: Don't lose or lose as the minimum amount possible of clients that you can to [00:05:00] keep your client base healthy and growing over time. So that's number one. Number two, it's how can you increase lifetime value by having either a great system that resells your offer or have multiple offers that Your clients can buy.

[00:05:13] Jay: And then third, it's how can you generate referrals out of your client base so that you don't have to pay for that acquisition of new clients because your client's happily. Refer their friends and family to work with you. There is also a hidden force behind all of that, which is word of mouth. I think it's often neglected because you cannot measure word of mouth.

[00:05:33] Jay: It's really hard to measure, but when you have really good word of mouth about what you do and what you deliver, it will indirectly because it's not measurable, help your marketing and sales. Like think about people who heard, oh, it's super amazing to work with this company. They have a great service.

[00:05:49] Jay: They're super tailored to my needs. I avoid the word personalization 'cause I think there is a misunderstanding. What personalization is. I like the word tailored, which is adjust and [00:06:00] adapted to our client needs. So word of mouth. It's also another thing. But then the fifth part is when you think about your office suite and having multiple offers or multiple opportunities for your clients to buy from you.

[00:06:11] Jay: It's normally, most businesses are really bad at problem education. They're really good at problem education. During the initial marketing process, you know how to find a problem, you know how to solve that problem. That's how you create your initial. Offer in business, you find a problem in the marketplace, you solve the problem.

[00:06:29] Jay: You offer people something that can solve that problem, and you get clients in the door. What about the other problems they have? What about problems they didn't have at the beginning but they now have because they were successful while working with you? And most businesses don't spend enough time thinking about what other offers can solve new problems that your business could help them solve that will help retain those clients over the long term.

[00:06:50] Jay: But again, like I said, we always start looking at churn. 'cause if you lose clients. Back and forth, left and right. There is no need for you to think about multiple offers. The first goal should be, [00:07:00] how can I make sure I don't lose my clients? And multiple things are done there to make sure you have a great client management that prevents churn.

[00:07:07] Jay: Number one is what you just mentioned, expectations. I think there is a big misunderstanding, and I love this study, where they asked business owners and clients what should be the goal of a business? Business owners said. Exceeding expectations, and then they measured it. The inability for most businesses to exceed expectations was very consistent, and even though most entrepreneurs were just thriving and exploring all the opportunities to exceed expectations, the problem was it was very unreliable because they didn't meet expectations.

[00:07:40] Jay: Most of the time. Their clients were still in. And happy. And what they measure on the client side is that the clients see marginally a little bit of extra value when you exceed expectations, but it's very minimal compared to just meeting expectations. And that for me, it's the biggest takeaway. When you offer something to your clients, how can you make sure you build the systems and [00:08:00] make sure you can sprinkle some magic, also known as psychology, to make sure that the vast majority of your clients have their expectations met in the first initial.

[00:08:10] Jay: Duration that you have internally as a minimum engagement with your clients to make sure that the majority of them will be qualified to work with you for the long term that prevents churn and creates more opportunities for LTV.

[00:08:22] Allan: So what's an example of that kind of magic that you might sprinkle? Because a lot of people do feel, hey, if I exceed expectations, if I deliver. Faster, better, quicker, whatever it is that's gonna wow my client. And that'll create word of mouth, good reviews, all of that sort of stuff.

[00:08:39] Jay: I think the biggest misunderstanding is how clients perceive value. We tend to believe that clients perceive value from the intrinsic value a product or a service has. That's just one part of the equation. The other two are consumption and context. Let me explain a little bit more. So when you change the context, you change the value.

[00:08:59] Jay: When you change the [00:09:00] consumption, you change the value, of course, the intrinsic value of something, it's self-explanatory. But for me, I fell pretty to that like as an engineer for me, a long time ago, I felt that everything should be logical and if I increase the intrinsic value of something, people are just gonna get more value up to a certain point.

[00:09:18] Jay: And I think the best analogy is if you go to the best restaurant in the world. Intrinsic value is there, you know, the intrinsic value is there, but it's super loud, super busy. You don't like the overall environment that you're in. And then secondly, you take your kids with you and they're acting crazy that day and you don't get to try all the food the way you wanted to try the food.

[00:09:38] Jay: Do you think you're gonna get the maximum perceived value? No, because the consumption wasn't there and the context also wasn't there. And I think one of the biggest mistake I've seen for entrepreneurs is that. How can I make my service and product exponentially better? You cannot, you're gonna hit a ceiling like any business will hit a ceiling where unless you work with technology where you can just keep developing and building [00:10:00] new things based on the evolution of technology, most of the times, most of your magic, most of your differentiation, it's gonna be done through the other two parts.

[00:10:09] Jay: How can you create a great client retention system within your business that first fosters consumption so that your clients use what they purchase? It doesn't matter if it's a product or a service. Imagine you hire an agency. You are working with an agency to do all the marketing for you. That's amazing.

[00:10:24] Jay: But if they get you a bunch of leads and you don't call the leads and you don't get sales calls, you're not gonna get as much value as you could. If they would train you as well on how to call the leads and give you a system and maybe help you with a CRM on how you can easily call those leads from the CRM, or they might do the calling for you or might built an AI tool that.

[00:10:42] Jay: Calls the leads through AI and they just get people booked in your calendar that you have to do the sales after. When you can foster that consumption, that's critical. And then the context, basically the context is gonna be critical. 'cause the way someone shows up, it's context dependent. So how can I create the right environment for my clients [00:11:00] to flourish?

[00:11:01] Jay: And it could be through communities, people that use communities. Communities could be amazing, an amazing way for you to get your clients to get the right context. So the culture here is winning. Not losing or whining so. You can do through communities, but you also can do it through someone that takes care of all your clients.

[00:11:19] Jay: As an example, like in multiple business, brick and mortar or not. I think the brick and mortar businesses tend to do this better, or at least they did this better before, was they understood that as soon as you get a client in the door, you want to retain their client. You want to take care of their client, you want to be nice.

[00:11:33] Jay: You want to understand the expectations. You want to meet the expectations. I think over time, over the past 10 years, what we've seen with. All this growth in the online space, and a lot of businesses either being hybrid, they have something in person, they have something online, or they're a hundred percent online.

[00:11:48] Jay: We started to accept a little bit of sloppiness. So think about if you go to your barber, someone that goes to the barber shop every single week. If the barber was sloppy in the first few times, probably wouldn't go back to that [00:12:00] barber like, Hey, he's sloppy, he's not nice. Kind of rude. Gonna find another barber.

[00:12:05] Jay: But when people were like really loyal to those places in the brick and mortar space, it's impressive how they can retain clients for 10, 20, 30, 40 years and those repeated purchases from the same client over and over again, allow those business to have a book of business that they don't need to chase new clients.

[00:12:24] Jay: They just get referrals, word of mouth, and great retention.

[00:12:27] Allan: So, that sort of presupposes that the consumption gets them the result because a lot of times what people are really signing for, signing up for is a result whether they consume it or not. And often, especially with DIY kind of things or even done with you sort of things, it is hard to get them to do the thing, right, to follow the process, whatever.

[00:12:50] Allan: I know courses have like a. A shockingly low completion rate. Rate some, I think I heard somewhere like five to 6%

[00:12:57] Jay: Yep, it's under 10. [00:13:00] Under 10% for

[00:13:00] Allan: Yeah. So, it's a very low completion rate, but having said that a lot of people often just feel better by having. Made progress by having bought the course, by having bought the book.

[00:13:13] Allan: It's kinda like, I think there was a similar stat where people, you know, like only 20% of people who buy a book on their Kindle actually even ever open it. Right. Um, But they kind of feel better that they've got the book on their Kindle or on their bookshelf or whatever. So, I'd love to hear your take on that, whether consumption is.

[00:13:33] Allan: Super necessary to the satisfaction or to the getting of the result, or whether you think it's critical to that.

[00:13:39] Jay: There are multiple angles. When I say consumption is using even just a system that you have built for your clients to make sure you can. Create a space, a safe space for transformation. I do believe that most of the results clients will get is through the person they become while going through this work with you and with your company.

[00:13:57] Jay: And again, there are multiple [00:14:00] levels and layers and factors that can affect that, but I am a true believer that what we've seen working before, like 10 years ago. 80 years ago, six years ago, that you can just sell courses and people will buy courses and they will be happy with the courses. That's changing rapidly.

[00:14:14] Jay: Why? Because again, knowledge is not enough. Like you have millions and millions of hours of great content on YouTube. So it's not because people cannot find the right content. It's not because people cannot find the right things for learn. It's not that they don't consume those videos, they actually consume those videos.

[00:14:31] Jay: The two things they struggle with is first having a trusted source. For what they wanna learn. So trust is gonna be critical. And then number two, it's execution. So when I say consumption could be seen as the learning phase, but also execution phase is also another facet of consumption, which is, okay, cool, you learn something.

[00:14:52] Jay: When you have a great business that you are giving your clients a new skill set, you need to implement some kind of mechanism that can help with feedback [00:15:00] loops so that you can validate that your clients actually acquire those new skills through implementation. And the whole idea that we should just promise our clients more, should be faster, should be easier.

[00:15:11] Jay: There is a common ground to be find there, like think about this. In fact called the IKEA effect at this point with all the things that were sold by ikea. We all know that IKEA could sell ready, assembled furniture, and they still don't do it. Why are they avoiding to sell things that are ready assembled?

[00:15:31] Jay: It's just not to save on costs. I can guarantee it's not to save on costs. There is a high level of perceived ownership after you go to IKEA on a Saturday morning and you have to spend the whole weekend assembling your own furniture. So you're gonna assign more value to that furniture because it require some emotional investment and effort to get it done, so it shouldn't be too hard.

[00:15:52] Jay: So it's so difficult that makes you frustrated, but also shouldn't be too easy or it'll feel just transactional. A little bit of effort at on the [00:16:00] right dose that can help, again, with the consumption, can increase your emotional engagement and buy-in when working on something. Could be Ikea, could be working with an agency, could be working with a done with your program, that someone goes through the process with you, they'll learn something, but you don't make it extremely easy to the point that it doesn't let them acquire.

[00:16:21] Jay: The skills they're trying to acquire. I'm a true believer in Bloom's taxonomy, which is the different layers of thinking or different levels of thinking. Most people, the way they were taught in school is just to remember. That's the lowest layer. And if you just remember, you're gonna remember for a day or two, maybe three, and then you forget everything that you just learned.

[00:16:39] Jay: When you go from remembering to actually applying and thinking, and judging, and criticizing, and even creating your own framework. You're not gonna forget what you just learned. That's an example of a book, even for the 20% who actually read the books. Taking the time at the end of the book to look at the frameworks, review the frameworks, and think how you can apply those [00:17:00] frameworks over the next month or two.

[00:17:02] Jay: It's gonna make most of that information. Stick around for much longer instead of you just trying to remember. This is why I see so many people like going through books one after another, and then I ask them a couple of questions and they don't remember most of what they read. 'cause it's just a question of remembering and what we did in school, it helped us in school, but it's not gonna help us as an entrepreneur. I.

[00:17:19] Allan: Yeah. Yeah, you're right. You touched on one of my sensitive points. One of, one of the reasons I mean there are many reasons, but the, one of the reasons that really motivated me to become rich, I. Is so I never have to assemble shitty IKEA furniture or breaking my hand, trying to assemble that, you know, cheap furniture.

[00:17:37] Allan: So I'm glad to say that I've got there. So, I, but,

[00:17:42] Jay: You were able, you're not gonna spend the weekend assembling new furniture for sure.

[00:17:46] Allan: believe me, I'm not. And yeah, so, not a big fan, but I totally understand what you mean. It's the idea is that if they put effort in, they're gonna value what they create more, right? So.

[00:17:57] Jay: And there is a better example, like a really nice [00:18:00] study they did was to give people two options to groups of people. Group number one is like, what would be the value you'd pay for this mug? And number two, they gifted the mug first. And then they asked them, how much would you charge to sell this mug?

[00:18:13] Jay: And it was like more than twice the price. The other group. Why? Because there is now an emotional attachment to it. There is a little bit of effort associated with me owning this product. This is mine now. And that's something that I know some businesses do intentionally by design is like. Make it feel like it's yours, not ours.

[00:18:32] Jay: You bought it, but now it's yours. You organize it your own way. You applied your own spin. You did your own twist, your own thing, and now it's yours. And I think that's also something very important. And I mentioned something earlier, which was tailoring the client journey or tailoring your offer to match your client's wants and needs.

[00:18:49] Jay: It's a great way to shape how the client experienced that process with you. 'cause they're not gonna feel like you have a cookie cutter thing for them. It's like, no, they have the knowledge, they have the understanding. They have a proven [00:19:00] process, but they're also able to add or subtract something that is relevant or not relevant to me to make it feel more like my own roadmap, my own shortcut to get me to my destination faster.

[00:19:11] Allan: I totally understand. So one of the really important roles that we introduced in our business over the last, I dunno year and a half, is customer success and that, so we've got Sarah from our team who you know well, and it has been a real game changer because it's someone who's.

[00:19:29] Allan: Whole role is dedicated to making sure that someone is consuming, getting a result, showing up to calls, all of that, because it's easy to say, Hey, we delivered our part. We did our part, we did the coaching, we did the whatever we delivered the course, and all of that sort of thing. It's up to you to consume it, to get the result and all of that, but whether you are.

[00:19:48] Allan: You are right or not, you're gonna lose in that kind of scenario because people are gonna be like, Hey, I bought your stuff and I didn't get a result. Even though it's their own fault, it's kind of like when people buy the gym membership never [00:20:00] attend, or you know, the buy the fitness program and never do the thing, never follow the diet, or whatever.

[00:20:05] Allan: So it is incumbent on you to ensure that the person is not only buying the thing. Getting the result that they actually bought because they're never buying the thing, they're buying the result. So talk about this role of customer success. What businesses should have a dedicated customer success person?

[00:20:22] Allan: What about normal brick and mortar type of businesses? You know, in the corporate world, I think they call them account managers. So depending on what line of business you're in or what industry you're in, they might be called different things. Might be called customer success, account management

[00:20:35] Jay: That's a good question. I think most businesses, based on the trends we're seeing are creating or expanding their client success teams. Why again? The cost to acquire a new client is just creeping up over time for most businesses.

[00:20:50] Jay: Everyone has to pay more and more to get a new client in the door, and the only solution for those businesses to keep profits healthy. It's through increased LTV, and [00:21:00] like increasing LTV, it's gonna be critical. And normally it's not your sales team or your marketing team who are gonna spend the most of their time and energy nurturing your existing clients to get.

[00:21:10] Jay: Them either to the result or find better opportunities to expand revenue or expand lifetime value for your existing clients. So most businesses will benefit of having like a client success department. It's gonna be as big or as small, depending on how engaged and involved you are with the client. So if you sell products.

[00:21:29] Jay: And everything you do is a little bit more transactional. It still pays off for you to have a clear client journey so that you know what gets a client in the door, what the client typically buys, what makes the client come back? How can you kind of reverse engineer that so that the clients actually go through the process?

[00:21:46] Jay: You have a vision so that they can back and buy from you again. But businesses that have a more one-on-one relationship with clients. Brick and mortar. Could be gyms, could be a barbershop, could be online businesses who sell a [00:22:00] service. Anytime we talk about a service, you need dedicated people to client success first, to make sure we measure and track how our clients are getting value so that we can fit marketing and sales.

[00:22:11] Jay: No one knows your clients better. The new client success team, we can do all the market research we want. We can do all the sales calls we want. We have a transactional interaction with your clients. When you have a client success team dedicated to take care of your clients, that team tends to spend much more time with your clients understanding what are the new ones and the new needs, and what's working and what's not working, what do they like, what they don't like about the product or service?

[00:22:37] Jay: What are the inflection points in the client journey? So most businesses would. Clearly benefit from having someone, at least one person dedicated to that and finding opportunities to, again, how can we prevent churn? How can we increase lifetime value by creating new offers or giving our clients a better opportunity to extend their existing stay in contract with us?

[00:22:58] Jay: And then third, how [00:23:00] can we basically foster. Referrals. How can we tell our clients that we really appreciate referrals and how can we reward our clients for bringing referrals so that we create a culture and a community and an environment and a client base that actually feels good and feels proud about bringing referrals to work with us?

[00:23:18] Jay: Again, like I said, if I wanna separate in two different containers products, you need client success. Less important, a little bit more transactional. There's still a loyalty piece that I think is super critical that we shouldn't forget. 'cause again, if you create a second product line, you still need client success.

[00:23:33] Jay: Someone in charge of client success to understand what made your clients happy and successful in the first product line you have created before you expand into a second. Product line. But when you have a service it's becoming an non-negotiable. Nowadays, clients expect a different level of care a different level of human touch, and that, that has been the most challenging thing I've seen over the past five years with the business I have today, but I've seen this over the past 10, is that with all these growing [00:24:00] technologies, with all the remote.

[00:24:01] Jay: Work with all the online interactions we have nowadays. I saw a lot of businesses losing that human touch, and I do believe through the work we've been doing over the years, that you can keep that high touch, high quality experience for your clients if you have someone dedicated to that implementation.

[00:24:17] Jay: So we cannot expect marketing and sales to do that implementation. We need someone assigned to take on that role.

[00:24:23] Allan: what about the person that does the delivery? For example, if you're a fitness trainer should you have a different person doing client success or is it okay to kind of go, okay, I'm in client success mode and now I want to wanna measure, you know, how a client is feeling about the program or whatever.

[00:24:40] Jay: If you're a solopreneur, yes, a hundred percent you'll be the person probably doing all the things at the same time. But if you have a gym and you have multiple fitness trainers, the gym should be responsible to give everyone the baseline training on what the ideal client journey should be.

[00:24:55] Jay: Even if that client journey is just to the point where the client shows up for the first time [00:25:00] for weighing in and get a prescription of a workout or whatever. That journey needs to be customized to a way that everyone can use a recipe that works. As an example, the client signs up, they go to the gym, they wanna take a look, and they sign up, they pay.

[00:25:14] Jay: Cool. Client success starts immediately. How is the client being welcome? Is the client getting an email? Is the client getting an SMS? Is the client getting something that creates a transition moment between not being a client and now being a client? Can they understand there was a transition, there was an identity shift from I wasn't healthy, and now I'm a healthy person 'cause I just signed up for the gym after welcoming the client.

[00:25:37] Jay: How's the onboarding? Is someone the fitness trainer who's gonna work with that client? Grab the phone and call the client. Hey, client A, my name is Jay. Super excited. Just saw that you signed up today. For our gym. Just wanna make sure we can find a time that works for you. I can show you the facility, we can talk about some of your goals.

[00:25:55] Jay: I can help you with some workout prescription. We have someone that helps people with [00:26:00] dieting. We'll see what makes sense to you. Do you have any availability tomorrow? Yes. At 10:00 AM I can be at the gym. Okay, cool. I'm gonna be here. I'm gonna be waiting for you. See you tomorrow. They're welcome. That transition and that onboarding is gonna be critical.

[00:26:12] Jay: 'cause that's what's gonna help us to understand like, how can we better serve those clients? And again, then all fitness trainers can have their own twist and their own way of talking to clients and what they're specialized in. But I think I. Getting those clients to show up at the gym for the first time.

[00:26:27] Jay: Get to understand your client's goal, get to create some buy-in and understand what makes the client bought in so that they can go to the gym more often and be more successful in their healthy journey. It's gonna be critical. And then there are multiple things that, again, the business will want to do.

[00:26:41] Jay: The business want to keep track of. How are we interacting with our clients? When the clients don't show up to the gym, are we sending them reminders? Is there anything that show us that the consumption, like we talked about before, is not there and their client might churn? Are we sending them reminders like what Duolingo does?

[00:26:57] Jay: I think Duolingo has a perfect [00:27:00] example. I think if you don't show up in one of the lessons, once you get a reminder, second time you get a second reminder, a third time you get a reminder. Asking if you want to opt out from those reminders. 'cause they understood that if you remind someone too many times, they just get frustrated.

[00:27:14] Jay: So they give you an opportunity to opt out from those reminders that make you feel like you're failing. Can we give those baselines and ideas to our personal training staff so that they know it's okay to remind the client to come to the gym, but. If you are reminding them too often, you actually might turn their client 'cause you are overdoing it.

[00:27:31] Jay: And again, like how are we tracking those clients? How are we celebrating those clients? If the client comes to the gym, 10. Times like in the first three months. Are they getting an acknowledgement for that? Is it there an opportunity to celebrate how much that client has done? Or as an example, like you've come to the gym more than 78% of the people in this mouth or something like that.

[00:27:52] Jay: Something that. Gives them a sense of completion. And normally one of the things that tends to increase buy-in it's proximity to [00:28:00] completion. You're getting closer to the goals you have in mind because now you've been doing what you always wanted to do and you were never able to do consistently. And then tracking how are.

[00:28:09] Jay: These businesses, these gyms, tracking those clients. Like how are they tracking who comes to the gym, who doesn't? Who's working with the personal trainer, who's not, who's working with the dietician, who's not, who signs up for classes, who comes for free workouts and they just wanna do their own thing? And they don't want to be annoyed by personal trainer kids, their experience.

[00:28:27] Jay: They just want to go to the gym, do the workout, and go back home. Those small things can be engineered and be given to your staff on a silver platter, and it's gonna make the experience the same. 'cause the. Worst thing that can happen to a business is like, Hey, when I work with personal trainer A, it's amazing, but when I work with personal Trainer B, it's awful.

[00:28:48] Jay: They're not gonna refer someone they know 'cause they're afraid that person they know might be assigned to personal trainer B and they just trust personal trainer A and that trust can be built an engineer when they have a map and a journey that can [00:29:00] be applicable to multiple clients. You're onboarding in your facility.

[00:29:04] Allan: Yeah, it's, that's so true. I mean, there's a cafe that I sometimes go to and that have great food or whatever, but depending on what chef is there, it'll be the same dish will be done in a different way. Sometimes it'll come with. With, you know, a side of this or that or whatever, and it'll be done a different way.

[00:29:22] Allan: Not necessarily bad, not necessarily better or worse or whatever, but it's different, right? Whereas it's not a consistent experience. It's not like, okay, I show up I order I, and I know what to expect. So, I think consistency is a very important part of customer experience.

[00:29:39] Jay: That's what made McDonald's part of what make McDonald's who they are. Because I'm going to use a word from someone that I love. I think he explains client journey super well from a marketing perspective. He says that it's the most consistent mediocre food experience that you have, but what he says, and I'm stealing his idea, his big [00:30:00] idea is that it doesn't matter where you go in the world, it's gonna be very similar and very consistent.

[00:30:05] Jay: So when you want. You wanna take something that you know, you understand what's gonna be delivered. You understand what's the, what are the fries and the burger. They're gonna be like quite similar worldwide. You go with a safe bed and the second thing, they're so consistent on the delivery of the food, but also people don't have to.

[00:30:23] Jay: What help them so much, is that the way they play with it, it was like, okay. Cool. I know that people will come here if we're consistent. We don't need to deliver like a Michelin star kind of experience, but if we're consistent all around the world, people will come back. And that's for me. I'm not a huge McDonald's lover.

[00:30:42] Jay: I rarely go to McDonald's. Just not my personal preference, but I do appreciate as a business how they were able to create this the speedy system. Like they called it at the beginning, the speedy system to get everything done. Very fast and very consistently so that everyone would get the same experience over and over again, I think as a safe bet for [00:31:00] them.

[00:31:00] Jay: It's a great example. I think for other businesses. You don't need to become a McDonald's. I don't think you need to be commoditized that way, but if you can deliver consistent experience and leave your client success team to make that experience even better by managing your clients, coaching your clients, managing your.

[00:31:17] Jay: Client's emotions and mindset when you're working with them. That's gonna be amazing. And again, I think that's also another thing that is often neglected, is that we think that, again, it's just intrinsic value. Now, there is a lot of work that is done when you have a service and work with clients. There is a lot of.

[00:31:32] Jay: Hiccups, mindset, blocks, mental challenges, a lot of identity shifts that will happen throughout the journey when they're working, trying to get to the result they have envision that having someone, having a team that can work alongside them and have the empathy because they understand not only the logical journey, but also the emotional journey that the clients go through.

[00:31:52] Jay: It's massive.

[00:31:53] Allan: Yeah, so we really need to think through the whole entire customer journey from them [00:32:00] just discovering you right through to them being satisfied. I getting you referrals buying more from you. I often say, I mean, there's really only two ways to grow a business. Number one is to get new clients, and that's the fun, sexy way, which everybody loves.

[00:32:13] Allan: And of course I love that too. But where the money is really made Is to make more from existing clients that LTV. So, we measure getting clients with a metric called CAC or cost of customer acquisition. And we measure how much we make from clients by LTV lifetime value.

[00:32:30] Allan: So they're really the two metrics you need to know in your business. And LTV is that lever that you can really pull. I mean. We see tons of different businesses from heaps of different industries. And I would say for the most part as a rule of thumb, most businesses could double or triple their revenue by adding no new clients, just by increasing customer lifetime value, by getting clients to stay longer, to buy more frequently, to buy in greater volume, to ascend them to higher levels of [00:33:00] your program, all of those sorts of things.

[00:33:02] Allan: And. Most businesses, it's funny they don't focus on that. It's something that's maybe an afterthought. Something that like sometimes we'll ask a new person in our coaching program. Okay. Well, do you have an email list? Oh yeah. We've got thousands of people on our list. How often do you email them?

[00:33:18] Allan: I think we emailed them six months ago or once on Black Friday or something like that which is a very common kind of thing. So increasing customer lifetime value, it's a very easy lever to pull and it's something that can have massive effect. Jay the last block of the one page marking plan, I called it.

[00:33:37] Allan: Orchestrating and stimulating referrals, meaning it's an active process, meaning it's not something that we leave to random chance, which is what most businesses do. Most businesses will say, you know, if I do a really good job that'll create word of mouth. People will tell other people, and you know, maybe sometimes randomly that.

[00:33:52] Allan: That might happen, but that's kind of leaving things to random chance. What I want to do is orchestrate and [00:34:00] stimulate referrals. I want it to be an active process, something that I do intentionally. What are some of the best ways to orchestrate and stimulate referrals?

[00:34:08] Jay: So let's start with number one, ask. That's, That's the easy answer that I've seen over and over again. Business is not doing, they don't ask for referrals. And because they don't ask, think about the perception from the outside. If someone was working with you, they think, oh, these guys are super successful.

[00:34:27] Jay: I'm sure they don't need referrals. Like they have plenty of clients. They don't need more clients. That's the wrong assumption, but no one ever told them. That's the wrong assumption. So ask for referrals. So the process of asking is gonna help most businesses immediately. Just, if you have something you wanna do tomorrow, just go to your client base and just ask them for the ones you have a good relationship with.

[00:34:46] Jay: Just ask them if they have someone in mind that could benefit from working with you. So that's number one. Number two, lack of specificity. So for the people who ask for the referrals, they don't specify who they're looking for. Oh, do you know someone like you that [00:35:00] could work with us? I don't know who I am.

[00:35:02] Jay: I. Like, what do you mean someone like me? Give them like a specific example. Like, do you know any entrepreneurs that would need a better marketing and sales system to consistently get new clients in the door? Oh yeah. I have a few of those friends that are actually entrepreneurs. We have a group of people.

[00:35:19] Jay: Okay, cool. Are they working with anyone at the moment? No. Cool. Do you think there would be a good fit for our coaching program? I think so. Amazing. This is how it looks like. And then third, give your clients something simple and actionable. That doesn't require a lot of brain power for them to make that connection happen.

[00:35:34] Jay: It could be as simple as putting the control on you. Hey, Allan. Can I just give you the email and you take over? Sure. Perfect. Just tell me the name, tell me the email. I'm gonna send them an email. I'm gonna put you in CC so that you can see the beginning of the conversation and I can take it from there.

[00:35:49] Jay: I just need to borrow trust from my existing client to start a conversation with the other client. Of course, if they can do a little bit of the nurturing, if they can set up that conversation themselves, it's gonna be even easier, but [00:36:00] I just need them to give me permission. And the context so that we can get things rolling.

[00:36:03] Jay: I'm keeping things very plain vanilla 'cause there are multiple things we can do to make them fancier. And you guys are a great example of making things like super interesting and fancy. I'm gonna leave that out of the episode for today. You guys have like some really cool ideas inside of what you do.

[00:36:18] Jay: Those will be like the three critical things to make sure someone can get started right away. And then rewarding. I think rewarding will need to be split between. Transactional businesses and more intimate businesses. If your business is purely transactional with your clients, I go with incentives and not with the rewards.

[00:36:38] Jay: And let me explain. Incentives is something I'm gonna be telling the person that this is what they're gonna get if they bring a referral. I. I need to incentivize them to take that action most of the times because it's more transactional. But if I have a relationship build with built with that client, I don't wanna incentivize my client.

[00:36:53] Jay: I actually can feel off. And the example I normally give it, it's just based on goodwill. If you have built enough [00:37:00] goodwill with that client, it can just use the existing goodwill to ask their client if they know someone, there could be a referral to work with you guys. If I see you out there and your car is broken, I'm gonna leave my car.

[00:37:12] Jay: I'm gonna help push your car. Immediately, but if I was passing by and offered me five bucks to help push your car, I would say no on the spot. A logical person would say, that's, doesn't make any sense. That's not logical. So you would do it for free, but you wouldn't do it for five bucks. Of course. 'cause the first example, I'm doing it based on social norms, on helping someone, makes me feel good that I help someone.

[00:37:38] Jay: The second one, it's economy. It's an economic transaction, and for me, I'm worth much more than five bucks for that. So just be careful when measuring what you sell and what you offer to your clients to understand if it's not transactional. If there is a relationship that has been built with that client, don't offer to pay them for a referral right away.

[00:37:56] Jay: What I normally do, I use Goodwill to get the referral process rolling, [00:38:00] and then as soon as I get the referral. I reward them with a gift. The gift is gonna be even better for them. 'cause they were not expecting the gift they just referred 'cause they enjoy working with you and now they get a gift. That's an example where exceeding expectations could be massive and doesn't cost you anything at all compared to what you would have to pay to acquire a new client through your other client acquisition methods.

[00:38:22] Allan: I totally agree. I mean, something where there's a high degree of trust involved. So for example, if I referred you to a dentist or a chiropractor or something, and then you found out later, Hey, I actually got a, an incentive for that you'd rightly be thinking, did Allan refer me to this because it's a really good doctor, or did Allan refer to me because he got an incentive?

[00:38:41] Allan: Right. So, often the. The act of doing the referral and the elevation in status that the person gets as a result of referring, that's really the reward. And you take that away by making it incentivized or a transactional thing. So it's very important to [00:39:00] understand. The psychology of referrals.

[00:39:02] Allan: Why does someone refer? You know, why would I refer a restaurant to my friend? Because if my friend goes there and has an amazing time, comes back, says, Allan, we took my wife there. We had our anniversary of dinner, we had an amazing time. That now elevates my status within that. Peer group, right? So I'm not trying to do a favor to the restaurant, and, you know, the restaurant could incentivize me or whatever.

[00:39:23] Allan: That would not move the needle for me at all. I want that status that comes back of, you know, my friend saying, Hey, had an amazing time. Thank you so much. I added value to his life. So in a similar way, you don't want to take away the thing that really raises somebody's status, especially when it comes to referrals.

[00:39:41] Allan: The other thing that I've noticed, and I write about this. Is that someone won't. Refer somebody else to you, unless they're 100% sure that it's a good fit. Like if they're 90% sure, they're like, it's risky because hey, I might refer someone and you know it's [00:40:00] not a good fit. Or they get hammered by a sales person or whatever.

[00:40:03] Allan: And again, what's that gonna do to my status that's gonna lower my status within my peer group? They'll be like, ah, man, this guy you referred me to, he just keeps hammering me with sales calls, is not really what I was looking for or whatever. So. You need to have a way to arm maybes that are good fit, right?

[00:40:20] Allan: I call it arming your referral network. So can you have something of value that you can pass on to your friend or colleague or whatever that, you know, you're not necessarily putting them in the line of fire of a sales person when they might not be ready, but you've got something of value. So in my business, obviously I use my book, right?

[00:40:39] Allan: So, whenever I send somebody a book I send. Two copies, one for them and one for them to give away to a friend, colleague, relative, whatever. And so that friend, colleague, relative or whatever, may not be ready to. Buy any of our stuff. They may never buy our stuff, but it elevates the status of the person who gives it to them.

[00:40:58] Allan: It's like, because a book has intrinsic [00:41:00] value. A book is worth maybe what, 20, $30 or whatever it is at retail price. And so they're giving something of value to someone in their network, whether they end up. Working with us or not is a secondary thing. So how can you arm people within your referral network?

[00:41:15] Allan: It may be a gift card, it may be something that they get of value when somebody isn't quite sure, Hey I don't really wanna put them in touch because I dunno whether it's a good fit. I dunno whether the timing is right. I dunno, whatever. But what's something that I can arm them with that could really raise their status within their peer group?

[00:41:33] Allan: Still?

[00:41:34] Jay: I am not gonna go with the gym one 'cause I think the gym one is overly easy 'cause they already do all of that. They do the bring a friend day and you bring a friend and both of you work out together. That's very easy. That's what they normally do. And it tends to work like amazingly well. Amazingly well.

[00:41:49] Jay: 'cause again, like it's a lower barrier to entry. Someone that they know already works out there. They know the personal trainer, then bring someone else. It's just so much easy to get that done. There are other [00:42:00] examples. Let me use an example now for people that operate a businesses mostly online, even if you have like a masterclass, something like that, that they can.

[00:42:10] Jay: Gift. Someone like, Hey, I got this gift card, and we can send 'em something physical, like a physical gift card with a QR code. They scan the QR code, takes them to a masterclass, and in that masterclass there is no selling, no nothing, just value. It's an opportunity for them to get to know you, get to know what you stand for, get to understand your values.

[00:42:31] Jay: Get to understand what to typically help people with and give them some actionable steps they can take immediately after watching the masterclass that get them to momentum, get them to see some progress. And then again, it's up to them if they want to engage with you, if they wanna work with you, if they want to be a coaching client, but something that gives them action.

[00:42:48] Jay: I know that not. I'm using this example 'cause a lot of people will say, Hey Allan, but you have two books. It's a lot easier for you 'cause you have two books. And I have a book. I do the same as well with our book. But for people that don't have a [00:43:00] book, you don't need a book. You can have like a a lead magnet that it's, it was maybe, I don't know, or like a tree party kind of thing.

[00:43:07] Jay: Something you were selling for a very affordable price. In the past, a recipe book, whatever you have that you were using before, that you can gift their friends and family that get them to know you a little bit better. It's gonna make them feel good. It's like you said, I think you nailed it perfectly.

[00:43:23] Jay: It's more about how it makes your existing client feel than how it makes the new one or the probable new client feel at the end of the day. They need to feel good about that. Initial action so that they feel comfortable asking more people to get to know what you have to offer and arming them. I don't want to go extreme like you would do with affiliates.

[00:43:42] Jay: With affiliates you need a lot. It's gonna be very dynamic. You need like social media posts and copy and emails and swipe files. That's very complicated. Most businesses, if they're not gonna do the affiliate marketing approach, they can have something simple. Find one to three assets that you have in your [00:44:00] business that are super valuable.

[00:44:02] Jay: Don't cost you massive amount of money or loads of money that is gonna complicate your cash flow, but it's so much valuable for whoever gets access to that, that you're willing to give it for free to the right person.

[00:44:15] Allan: Yeah. Yeah. So true. Jay is there anything else that we haven't really spoken about that you feel is like one of those small hinges that swing big doors, that make a really big difference, either with customer retention, customer success, lifetime value referrals what's something that we can leave our listeners with?

[00:44:34] Jay: I would say one last thing that could be an interesting thinking process for everyone that listen to the podcast to think about is like next time you get to interact with a client, it doesn't matter if they have been working with you for four weeks, four months, four years. Ask them a very simple question Where do you see your life in the next six to 12 months.

[00:44:55] Jay: Just ask him that very simple question. 'cause that question will let you know [00:45:00] where the desire. Is there is one key thing in marketing that most people learn when they learn marketing. We don't create desire, we channel desire. So when you are able to ask those clients where their brain is at for the next six to 12 months, you know where the desire is, then you can channel that desire for whatever products and solutions you have available that can help them get to those goals, get to those outcomes, get to those results they want.

[00:45:25] Jay: Most people are so focused on the now. And that's where most of your time and energy should be to get your clients to the first result. Now that they forget to ask the clients, are your goals still the same? I've been working with you for four years. Your goals now must be different from what they were four years ago.

[00:45:41] Jay: Where do you see your life in the next six to 12 months? And knowing that for the majority of my clients, how can I shape build, isolate, breakdown in pieces. What I typically offer to make sure that I have the right offers for my existing clients instead of just doubling down and making the [00:46:00] streamline front end flagship offer kind of thing.

[00:46:02] Jay: Think about what other multiple offers or ideas can you put on the table that will allow you clients to stick around for the longest.

[00:46:09] Allan: I love it. Thank you, Jay. Where do people find you? And we'll of course link to that in the description and the bio.

[00:46:16] Jay: Cool. So two simple things. You can go to ethical scaling.com. We have a blog. There are links to our book. Our book is called Customer Success Manifesto. You can find it on Amazon, you can find it on Audible. All the versions. I. And probably the easiest way, again, I'm gonna do the same thing as you did.

[00:46:32] Jay: Like the easiest way to get to understand what we stand for, how we look at client retention, client success. Just go through the book. It's long, it's 300 pages, but it's like a lot of stories, a lot of experience working with clients over the years. So most people that did read the book, they enjoy the experience.

[00:46:47] Jay: That would be my recommendation. We also have a podcast called Ethical Scaling Podcast on YouTube and Spotify and Apple Podcast. If you're more like into listening than actually reading. That will be my recommendation.

[00:46:59] Allan: [00:47:00] Amazing. Thank you so much, Jay. Uh,

[00:47:01] Jay: You for having me.

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