Welcome to the Scale With Speed Podcast. I’m Matt Manero and I’m Judge Graham.
I’m wearing black today. Cause black is slimming. The black is slimming. You look good though. Hey man, we’ve been on the road. We did the Burn the Ships group here in Dallas. Yeah. And then immediately the following week, we took it on the road and did the combo version of it. We called it Scale with Speed with Coach Burt’s group in the Bureau beach, Florida, which was cool.
What a hell of a trip, I got to tell the story. So we get out of the plane and I’m exhausted. I mean, we’re both exhausted. I’ve just been traveling that weekend too. I just got back from Palm Springs and got off the plane and I’m like, all right, Matt, I’m going to, I’m going to get the Uber. So I pop it down. I hit it. And I look at the freaking cost and it’s like $340. Where are we going? It’s an hour and 40 away. So then I started busting his balls about like, why’d you book this airport what’s going on? But it happened to me, that was just what it was.
It’s hard to get to Viro. There’s no easy way. But when I, when I breached it, said Orlando, Melbourne. And I didn’t, I thought that just meant Orlando. So I booked Orlando or LA
It’s still an hour and 30 minutes. Even if I would’ve gone there,
Palm, they said with the traffic might still be an hour and 15 minutes. So, but anyway, we did it, and then we met a great guy on the Uber back. What was his name? Tom. Tom from Jersey. Good guy, man. So look, the, you know, the thing we keep seeing with all the attendees now over 200, who’ve come through the burn, the ship’s ecosystem. It’s very interesting. Number one. Um, there’s a lot of frustration in the marketplace, man. People, people have had the pain and they’re looking for the gain, you know? I mean, isn’t that a recurring theme where like, dude, I’ve been trying, man, I’m working it, I’m doing the best I can. And I just, I don’t know that it’s gonna work. I’m losing confidence. So maybe I’m just going to be okay with where I am and we try to wake people up.
The second thing we always see is where so many companies fail is in this culture and value system. The biggest takeaway I think is that people and we’ve already seen texts from people who are redoing their core values and uh, and the impact is that most. And, and you know, we’re on the other side of it, but I do remember, you know, number one, not having a value system to the business, but then also putting it in and being, having to be relentless to it and allowing the change to occur. A perfect example that just happened here. Um, and we’ll, we should do a podcast on what reviews mean and why they matter, but we’re doing a review thing here in the office. And, um, uh, you know, we were getting so many reviews coming back in from clients and they’re referencing both the salesperson and the operations person, which ties to the core value of teamwork. And it just gives you this unique opportunity to reinforce here’s teamwork, playing out again, guys, here’s teamwork playing out again. Here’s how the marketplace and the client base is seeing that it’s not just the salesperson, who’s in charge of the relationship, but there’s somebody else within the organization that’s in charge and they’re being noticed, man. That’s great.
More importantly, the customer is seeing the reviews, right? I mean, listen, we talk about this and I believe it’s gotten even more important, right? People want to be judged by their people, want to judge your company by their peers, right? What does that, you know, be judged by your peers? There was a saying, you know what I’m talking about? I’m not sure I know that one judged by a jury judged by your peers. I don’t know. It doesn’t matter. They are looking at the peers and the reviews to make that decision. Right? We talk about it all the time. 67% of people do their diligence digitally. That could be Google reviews. That could be Yelp. That could be social media. That could be the website before they make a decision. And if they see shitty reviews and, or no reviews could do business with you,
We’re going to do a whole podcast on this. This is just too important, to glaze over. Um, so w we’re gonna, we’re gonna, yeah, we’re gonna put a pin in that one or we’re going to do a podcast on what reviews mean. All right. So today we’re talking about client retention strategies, right? Um, and what can people do to do business and keep business and, um, make sure that the client, the hard work of earning the client, retains the client and keeps them coming back. And, and you know, one of the things you wrote, the book mastering recurring revenue, it’s about client retention, right? So go to Amazon and get the book master in recurring revenue, judge Graham. But the concept is It’s like this. When you see the offer on television and it’s, and the fine print says, this is for new customers only to get the discount. I never understood that
We don’t care about the older ones,
The old ones we already got your business, right? I’m the old co why wouldn’t I get the discount? Why would only a new customer get a new discount? Why wouldn’t I get a discount? It makes me crazy that people don’t understand the importance of client retention. So that’s what we’re talking about today. Because if you look at your business as if you were a T a scientific, you make a, a drug, right? You make a vaccine, you’re spending billions of dollars, the research and development to try to create the vaccine that works to then keep your fingers crossed and sell it to the marketplace. The same thing applies when it comes to finding your clients, whatever you’re spending to get that client, you may have a loss leader on the first deal you do with the client. It’s the second, third, fourth, fifth, 60, that you can make a margin on the lifetime value.
Yeah, it costs, uh, what’s the stat. We don’t have it in front of us, but I know it’s five, it’s five X. It costs five times more to get a new customer than to keep an existing one in. It becomes so important back to that recurring revenue. And we were in a meeting last night, with the company talking about this, right. And we were looking at it and we were just like, all right, guys, listen, all you need to do is freaking continue to win the amount that you’re winning, but freaking keep what’s your win in over four or five months, this place is going to look different cashflow scale opportunity. But, but for whatever reason, Matt, I mean, everybody’s so focused on
New business, new business, winning
It, that they don’t service or keep or maintain or cross-sell or upsell the current customers.
So, you know, me, you, you have probably the best example or storyline I’ve ever heard on this, which is, you know, in, in Jimmy, the guy, you buy your trucks from. So lay into that story for a minute. So people can understand how this plays out in the room.
Okay. And I’ll be relatively quick, but you know, I’m, uh, I’m in Texas. I got the hat on. I’m the only guy that wears shorts Yeezys in the cowboy hat. But usually, I have, I have cowboy boots on, but listen, I, I love big trucks, big Texas trucks. And if you are familiar with the Texas area at Hales, all right. So super important that my big ass truck can fit my garage. Now that garage is eight feet, but remember I want a lifted truck, big wheels.
Well, on the new truck you’re getting, what do you get? 37, 38, 30 eights and a four-inch or a six-inch.
Uh, it’s going to look nasty. It’s a 3.5-inch lift at 38 by the twenties.
Okay. So that’ll be right about ADHD.
I don’t know. I’m hoping we’re going to have to, we’ve measured. We’ll see. So anyhow, I found, I used this trial and this, I bought the current truck. I’m getting delivered soon, hopefully, um, from this guy named Jimmy. Now, the reason Matt, tell me about your last truck who I’m going to buy continually from. Okay. And it gets back to this customer-centricity and servicing and focusing on your current customers. This guy understood how to take care of the customer. Okay. I just make it fast. I found two trucks, identical online. The only difference was the wheels. I was happy with either one called the first place. The first place wouldn’t measure the truck for me called the second place. Jimmy, not only did he measure the truck, it was too big. I said, no, thanks. He said, man, I drove it over to see if it fits.
I said you’re out of your mind. Why are you questioning my measurement skills? He was right. I was wrong. He drives over, throws the truck at the garage at Fitz. No problem. I bought the truck from Jimmy and there’s more backstory behind how we sold it. And multiple lessons learned, but what’s been great about Jimmy is he understood the customer and did what it takes to win the customer. And Jimmy follows up, right? Jimmy says, Hey, there’s a new truck coming out. This guy buys. And I buy a truck every six to 12 months. I’m getting better. I’m trying to cut that to 12 months long instead of buying them every six months. But he understands the power of that customer right now. Um, I don’t say this to impress or, you know, impress more than impress upon people. I mean, the trucks I buy aren’t cheap.
These are a hundred thousand old trucks. I mean, they’re brand new trucks. They’re all customized, you know, stereo system lights, bumpers, grills, tires. I mean, so they’re brand new. So there, they’re pretty expensive. Um, you know, vehicles as it relates to a truck. So if you put one customer like me, in perspective, Jimmy did a good job servicing me, selling me the truck, and following up and understanding who I am as a customer. And let’s just assume every year I’m buying a vehicle of that, dude. I just, that one customer lifetime value becomes a pretty big number for Jimmy.
Yeah. I mean, you, you will be worth a half a million-plus lifetime five years. And anyone who says I want to buy a truck, call my man, Jimmy. So, you know, it’s a million-dollar relationship for Jimmy, one customer, one customer, because he took care of you and did what you needed. Now, the challenge that we find when we go into business and we talk to people on client retention is a lot of times it’s related to the way we pay our people. So if you have commission-only salespeople, because you’re afraid to pay a living wage of base salary. So you put them on commission, not only does that create the whole other riggermerall of cultural impact and, and, and, you know, do they sort of fall in line with how we do it here, all that piece. But the other thing is every customer is a transaction for them. They’re not necessarily looking at the lifetime value of a customer. They’re looking at it as a commission factor. So how do we advise people in which when your salespeople are commissioned, that they just have to go a few other steps for the long-term value?
Yeah. And it gets down into not only the steps but back into how you manage your CRM. How well are you taking notes? That’s interesting.
Stay on that because that’s the deal, right? It’s, it’s how it’s this thing [inaudible] place to do it. I’ve seen this so many freaking times, the client thinks they’re doing business with a salesperson and only the salesperson because the company doesn’t manage the CRM. It doesn’t use the data to say, hang on a minute. There’s a lot of other players that went into the success of your deal. We love our salespeople and they did a great job for you. But the reality is there was shipping. There were logistics. There was it, there was marketing, there were operations, there’s a bond to other people. And when the company doesn’t manage the CRM, the salesperson controls the client relationship. And that hurts client retention.
Yeah. And, and it’s, it’s more than, you know, for you guys listening, going, dude, I got my CRM dialed in. I got trigger points. I got automated emails, no, to understand the customer on a personal level. Okay. Use me as an example, somewhere in that CRM should have the ability for that salesperson to say, this guy buys this amount of truck value about every six months, right? How you communicate with that individual. And the frequency is much different than the person that buys a truck and is going to drive it for 10 years. Right? I shouldn’t get the same email as the guy that’s been buying it for 10 years. But back to this, servicing the customer and it costs five X more to keep them like there’s so much money in just servicing in mining and taking care of your customers. Not only to keep them so they can keep paying, but coming back and to cross into new products.
So what we see here at the commercial fleet, which was probably the thing that struck me the most when we started mining our acres of diamonds. If you haven’t listened to that episode of scale with speed, you should go back a couple and listen to the mind in the acres of the diamonds podcast episode. But what, what I thought was so interesting was people don’t care about emails. I kept saying to the market, like, come on like the customer journey. I mean, I get the storyline from sources. That’s what we find. Send the email, no open, send the email, no open, send the email, no open, send the email, no open, send the email no open. I’m not done yet. Send the email, no open, send the email, no open. Send the email. Open
Time in circumstance,
Email, open customer hits the site. The customer spends time on the site. The customer fills out a credit application. We do the deal time and circumstance, the importance of a strategy that keeps you in front of the client. Not when you need the client, but when the client needs you. And that’s what we don’t do for client retention, we stop the follow-up.
Yeah. Th that’s. So what you just said is it’s when the client needs you.
And so if you’re not looking at it through that lens, you’re going to lose. And how do you look at it? In that lens? You’ve got to have a great product, got to have a great service. You got to have great customer service. You have to deliver, you have to do those things, but you have to intimately know the customer on an individual level and build systems and structure and process to ensure that you’re there. And you’re anticipating when they’re going to need it.
So this is an if for anyone who’s listening, who’s come to the early burn. The ship is a new topic that we put in a new deck that we put in. Judge created called buyer personas in which we’re talking about. Like, let’s be straight about it. If Jimmy called you up and said, Hey, Mr. Graham, you know, you’ve been a good client. I’d like to go to dinner with you. You’d be like, no, dude, you don’t have to Jimmy. It’s good. We’ll have to go to dinner. Right? Totally. But the salesperson who doesn’t understand your buyer persona, right? Knowing that that is not you, that strategy doesn’t work, but yet there might be someone else who says, yeah, I just gave you a hundred thousand dollars deal. You better take me out to dinner. Right. So you got to understand the buyer personas and communicate properly with the buyer personas. You talk about it best at, at our burn, the shifts where, you know, we’re talking about the one type of a buyer who is only concerned about how choosing you, makes them look in their career. And the other buyer who says, Hey, don’t call me. Don’t email. Don’t text me. Let’s communicate on Tik Tok. Yeah,
Yeah. Yeah. Well, and then now you know how to service them ongoing and how to communicate. And it gets back into what we’re talking about is, is, is keeping and growing the customer.
So let’s, let’s finish on the topic of client retention to get a better understanding of what it does to the enterprise value. Because when, when you go to sell your business and the smart people come into the room, one of the first questions they’re going to want to see in the data report, the data, pull the data room that’s been created. That’s starting to spit out all these crazy strings of data that you never looked at before. Your spell is to tell us how much repeat business you get.
Yeah. They’re gonna want to look at lifetime value. They’re going to want to look at how long on average a customer stays. And they’re going to look at how often are they attracting,
Uh, trading attrition, they’re leaving. Right?
Right. So lifetime value, how often are they buying? Staying and how frequently are they leaving? Yeah. Right. And so dude, if you have those things dialed in that number is just going to skyrocket. Now you can have the best business in the world and we call it leaky bucket syndrome. You know, you, you catch, you know, you got 60 fish in the bucket every month, but you got a hole in the bucket and you’ve got 30 leaving. It doesn’t matter how big the company is at scale. You could have a thousand fish every month and you know, 500 leaving your value is much less, right? I’ve read, you see, catch a hundred fish every month and keep 80. You’re going to win over six months.
We should probably preface this whole thing that, you know, you do have a product or service that customers want to stay with them if you’re not selling something that they don’t care about. But the finisher on this, one of, client retention is important for you guys to understand because you might be saying, we have unbelievable client retention because we do business with Walmart and Walmart’s 80% of our business. And we service Walmart. I wanted a podcast problem. We could solve the topic of client retention. We want you to look at the other side of that equation because we do hear that in burn the ships where people tell us, you know, I have this unbelievable relationship. And when we talk about customer-centricity as a topic of burn the ships and they’re like, Oh yeah, we got like three clients. If that’s a problem
For you, right. It’s more concentrated.
Yeah. What did I say? Customer centricity, customer concentration. That’s a problem. And so when you’re talking about client retention, you need to also play, run the bench a little bit deeper and find ways, to reduce the amount of volume that your revenue comes from in a very limited amount of customers. Cause dude, you don’t know whether somebody else is going to come in and lower the hammer, drop the price, and steal what you’ve worked so hard for because you didn’t have a diversity of clients.
Yep. Dangerous, very dangerous. Yeah. So takeaways are good customer service, right care about your freaking customer, and deliver a good product. But more importantly, learn from this podcast. How do you get an intimate one-on-one relationship to relook at your CRM? Re-look at the data that’s going in the new world of companies that thrive not only survive, but thrive. They understand customers on an individual level and that doesn’t have to be that complicated. There’s so much amazing technology that allows that to happen. You just have to start doing it because the old days, are over, right. There’s been this digital disruption and this new onset of customer-focused and digital transformation. And if you’re not aligning everything digitally around servicing the customer at a one-to-one level, you’re going to lose.
Everybody should go get their hands on the book, the challenger sale by Matt Dixon. We’re where they do the synopsis of the 2008 great recession. And they talk about how, um, the old school relationship guy who did the cowboy football games and the golf outings and all that sort of stuff. Pardon me, got his ass handed to him in Oh eight Oh nine when everything became commoditized. And so the idea that you need to have a relationship with your customer is vital, but the thought of what a relationship is is changed and needs to be completely rethought. So, um, I don’t know. So we can say on this topic, I mean, the first thing you guys should do is go back to the office right now and say, what are we doing to retain, keep, hold our customers to grow to make sure that our revenue is stable, that is our chaos. I mean, think of the chaos of every month, you’ve got to find these customers because of the attrition because you can’t keep them. It’s unbelievable. It’s impossible. All right guys, Judge, any parting comments for today’s episode of the customer?
The attention on the scale was a podcast. If you get and keep customers, you make money. So go make it happen.