To win the hearts and minds of your clients takes a special quality: Calculation.
Sun Tzu, in the book Art of War, suggested that one can win a war before it is fought. He teaches that an opposing army can use the other army’s deception to expose their weakness.
The deception is that cleaning prices are dropping and that clients should expect deep discounts due to market forces. You are the opposing army who has not been co-opted at this point. You may or may not have a plan to regain valuable territory taken under your watch.
Without a plan, you will lose your customers through three possible scenarios:
- Not having a retention plan, price sensitive clients will defect to the other side
- You lose your clients due to natural attrition, such as when they move out of the area
- You continue to do nothing and watch your business evaporate before your eyes.
We discussed the challenges in last month’s issue of Cleanfax and I have suggested that you are in a desperate battle for the hearts and minds of your customers. Conventional ways of marketing in the past will not stop the erosion of customers surrendering to the other camp.
Throngs of customers are being converted each day in your area to the veil propaganda that you are charging too much money for cleaning. Unbelievable but true. Clients want cheaper prices due to market pricing forces.
I want to really get deeper into preventative techniques to stop your clients from capitulating to the other camp.
Changing perceptions of clients
How can you change the perceptions of clients? Before I answer, consider this: Far too often the clients you service are a reflection of marketing and prices you’ve created.
If you don’t believe you can get $65 per room for basic carpet cleaning, then you won’t get $65 per room for basic carpeting cleaning. This is probably one of the main reasons you don’t sound believable.
You can’t change the landscape of your pricing when your pricing value holds you hostage to your belief system. You will continue to price your core services at a lower price based on the inner assumption that you can’t get higher prices in the area you are servicing.
Guess what happens then? Your clients are then programmed to expect lower prices from you. Your core values determine whether the client in your area is willing or unwilling to pay more.
Loss leader marketing is a tight knit community battling in the high stakes gamble of being the cheapest in the marketplace. These companies will drop their prices to increase job count. Why? They understand that getting in the door is a golden opportunity to have face-to-face contact with a client.
As you know, clients are more likely to purchase more, once you have established rapport with them. Therefore, companies that advertise cheap services will hire skillful sales technicians that can increase the size of an invoice through the art of manipulation.
Loss leader companies are not worried about retention in the marketplace. When you are getting 65 to 150 calls a week with new lead generating advertisements, the motivation to mail to an existing client base becomes meaningless.
The instant gratification of increased job count is far too attractive for these companies to shift their efforts. Weekly direct marketing ads make the telephone ring on a consistent and regular basis. It shapes the client’s perception to expect a low price for cleaning in the marketplace.
Since the objective of the advertising is to make telephones ring, loss leader companies would rather service clients who expect to pay less for their services as first time customers.
Price sensitive clients don’t see or care about the price war that could be compromising the livelihood of people working in the cleaning industry. Many single truck operators can’t outspend these companies in advertising. Without a counter voice, the loss leader marketing company wins by default. Their advertisement shapes the deflated price for services you see in your area.
How can you fight back?
There is only one method to recapturing occupied territory. You must concentrate on customer retention.
You have a number of customers who have used your cleaning services and appreciate the value you bring. Are you losing ground in your efforts to retain important clientele?
Recently, I sat in on a strategy meeting concerning a company’s business operations and what could be done to increase retention. The data suggested that 30 percent of clients used their services once. I was dumbfounded when I heard this.
Unable to view the data to ferret out more pertinent data, it was obvious that quality issues played a significant role. However, the main reason clients failed to call again for service was that clients typically didn’t see any variation in quality between companies that use lost leader ad tactics and those that didn’t.
Customers, who only call once, believe all carpet cleaners are the same. Without a clear distinction, they are more attracted to the loss leader companies with cheaper prices. They are willing to deal with the unsavoriness of the experience to get a cheaper price.
If you see a decline in your repeat business, it is possible that the loss leader message is working to change client perceptions.
Home court advantage
It is critical that you win the war with home court advantage. To use a sports analogy, no one wants to play a game at home and lose to the opposing side.
Remember, there are no loyalties among loss leader marketers. They have a wide net that is capable of snagging all willing customers who want a better price. It is about getting into the door and not the prices they charge.
Many have the same invoice average, after the cleaning, than those who set prices beforehand. They will drop their price to a single digit without advance notice if they can gain advantage over you. This is the reason they will clean a room for $2 if it will increase their job count. To the loss leader marketer, job count is king.
Many of their invoice averages are higher than cleaning companies who set prices. Always remember that the loss leader marketer will drop his price if it means getting an advantage over you.
You must invest in marketing that clearly brands your company and assures the general public that you are in the game to win.
You can get your clients’ attention by learning how to slam dunk on your own court. Never give loss leader marketers an opportunity to pick your pocket with their relentless marketing bombardment.
Face the fact that your prices are always going to be higher than a coupon marketer. Therefore, you must win the ultimate battle with clients who are already familiar with your services. Never again allow someone across town to make you appear irrelevant.
Handling new clients
New clients who call you on a referral generally know your prices, since word-of-mouth advertising often involves sharing not only the quality of work you provide but also the prices you charge. With exception of new clients that are referrals, you could lose the marketing battlefield with other new clients if you fail to control the image and message about your company’s services and the rationale for your prices.
Out of sheer curiosity, some clients are more likely to be tempted to call the cleaning companies who advertise ridiculously low prices in their advertisements. When a client calls them instead of you, the low price marketer wins. They win on the basis of the client’s perceptions that carpet services should be cheap and they rarely equate “cheap” with inferior services. In these cases, the lost leader marketers marketing blitz wins the messaging war that carpet cleaning is a cheap commodity.
Loss leader marketing has created an overwhelming impression over the years and has set a false price point that is almost impossible to overcome. It is like trying to scale Mount Everest without air supply. Clients don’t read the fine print, so they don’t know that the “Devil is in the details.”
The low prices they see advertised over weeks, months and years are perceived as authentic and not as an attention-grabbing marketing technique.
How do you get into the battle? How do you counter the misleading propaganda that cleaning prices are dropping?
For the most part, value-based marketing never gets exposed to the light of day with printed material in your marketplace. Due to financial constraints and/or indifference, carpet cleaning specialists who provide superior services feel ill-equipped to take on aggressive lost leader marketing campaigns.
Many value-based companies have been forced to remain silent in the marketplace and have been relegated to voicing their protests in select workshops and conventions, with no effect in changing the pricing landscape in their area.
There is no collective marketing voice to counter the low-price companies who try to set cleaning service prices in your area. Even large cleaning companies have capitulated to loss leader marketing to keep their job count higher.
Can you change the direction of this battle in your favor? You may not need a survival plan, but I am certain you can recover and make a stand to win the hearts and minds of your customer.
In part three next month, I will give you some battle strategies on how to recapture lost territory and gain the advantage. Don’t miss it!
Michael Morrow is a weekend consultant for Goldmarc, a speaker and an IICRC approved instructor. Morrow lives in Scottsdale, AZ, with his wife Leslie. He can be reached at (480) 388-4742 or MichaelDMorrow1@Gmail.com.