Turn the downturn into rounding error

(I published this post in June on tompeters.com.  The news of the past few weeks encouraged me to republish it here.)

The U.S. economy is in bad shape. If, by chance, you haven’t heard about this yet, just turn on cable TV news for 30 seconds.

What does this mean to your business? It could be terrible, but it doesn’t have to be.

How can I say that?

For the last few months, I have been asking workshop audiences the following questions:

1. What percent of your customers are giving you all the business they reasonably could?

2. What percent of your referral sources are giving you all the referrals they reasonably could?

The answers to these questions have stunned me, because they have been so low. I knew they would be quite a bit lower than 100%, but I’ve found that most executives estimate that only somewhere between 0 and 25% of customers are giving them all the business they could. The numbers are even lower for referral sources.

So, let’s say that the economic downturn has softened the market for your products or services by 10—20%. Yes, that’s a lot. But it pales in comparison to the 75% of the business you are missing if your current customers are only giving you 25% of their potential business.

Here’s the cold, hard (but potential-laden) truth: For most companies, the untapped latent profit in their existing customer relationships is much greater than the magnitude of our current economic problems.

The downturn is real. But so is the amount of business you are missing from your current customer relationships. How do you develop this potential with your existing customers?

Customers who believe they are in “We” relationships with you will give you a larger share of their business. They are willing to pay more, and they are less likely to leave you for a competitor. On the other hand, customers who are in “Us & Them” relationships with you are more likely to spread the business around among your competitors, and will also be more likely to bolt to the competition for a lower price. If you create “We” relationships with your customers, one relationship-building encounter at a time, you will go a long way towards making up for—and maybe even surpassing—the effects of the soft economy.

So …?

Tagged with: , ,
Posted in We relationships

Leave a Reply

Your email address will not be published. Required fields are marked *

*

Subscribe to the Blog
Email:  

On Steve's Mind
Get Steve's newsletter featuring his ideas and practical advice delivered to your email inbox.
* = required field
Latest Tweets
Testimonials
Tom Peters
When Steve Yastrow writes, I pay close attention.

Tom Peters

Founder, Tom Peters Company
Ward Alles
Steve Yastrow knows his stuff. That's why our management team has read all of his books. And that's why we've had him as a keynote speaker at both client and employee events. From creating brand alignment, to selling more effectively, to providing top-notch customer service, Steve offers words of wisdom based on real-life experiences. He always engages his audiences with questions, interactive exercises and great storytelling that keep you coming back for more. Read Steve's books. Then book Steve. You'll be glad you did.

Ward Alles

CEO, Core Creative
Mike Depatie
Steve Yastrow is at the forefront of the next evolution in marketing. We have implemented many of his innovative ideas... and have seen very positive results.

Mike Depatie

CEO, Kimpton Hotels and Restaurants
Rhoda Olsen
Steve Yastrow has clearly described the emotional reality of customer relationships and their impact on profitable business growth.

Rhoda Olsen

President, Great Clips for Hair
Chris Tucker
Steve is a creative and collaborative speaker who communicates his ideas clearly and concisely. He immediately understood our business needs and provided a better perspective on how our customers see us as a company. I have referred Steve to our customers in the past and I will continue to do so. He’s intuitive and has a unique way of looking at business. Steve has the experience to turn a project into something extremely valuable for any organization. I strongly recommend working with Yastrow and Company.

Chris Tucker

Director of Business Development, MBX Systems
David Sank
I highly recommend Yastrow and Company to any business that is intent on enhancing their customer experience. Prior to working with Steve, we were communicating various messages to customers. Steve and his team helped us achieve a cohesive brand message that we as a company live daily. Steve is an incredible listener and learned the nuances of our business rapidly. I can’t imagine anyone Yastrow and Company couldn’t help.

David Sank

President and CEO, Calico Cottage
american-licorice-logo
We have seen huge benefits from Steve's input. Steve is unlike any other consultant I've ever worked with. He takes a genuine, deep-seated interest in our business. He is intuitive and able to identify problem issues quickly. We wouldn't be as far along in acheiving of our long-term growth strategy if we hadn't actively and aggressively pursued Steve's Brand Harmony.

Michael MacDonald

Executive VP Sales and Marketing, American Licorice Co.
roma-maxwell
Rancho La Puerta has enjoyed continued success because of the work we did with Yastrow and Company. Together, we implemented business strategies that have contributed to our success. Steve and his team truly believe in our brand. I highly recommend Yastrow and Company to any business that needs help building the bottom line.

Roma Maxwell

Director of Sales and Marketing, Rancho La Puerta
roma-maxwell
I give Steve two thumbs up—five thumbs up, if I had that many!

Roma Maxwell

Roma Maxwell, Director of Sales and Marketing, Rancho La Puerta
jim-evans
Yastrow and Company introduced Brand Harmony and their Be the Brand concept to our team at Jenny Craig.  I believe these new ideas contributed in helping us triple the company's revenue during my years as CEO.

Jim Evans

former President and CEO, Jenny Craig
Alex von Bidder
In these high pressure times of bite-size communications we all hunger to be listened to and cared for individually. Our customers know great hospitality, the kind that is not about selling but treating their needs as our highest priority. Steve Yastrow’s teachings are applicable to any business that values long-standing success based on personal relationships.

Alex von Bidder

Managing Partner, The Four Seasons Restaurant, New York
Jennifer Whelan
Our work with Yastrow and Company yielded the best long-term value of any consulting engagement we’ve ever had. As we grow and expand internationally, Acuative continues to depend on the branding approach and marketing tools Steve and his team developed. Yastrow and Company genuinely partnered with us, were exceptionally responsive and remain committed to our success.

Jennifer Whelan

Vice President of Marketing, Acuative
jim-winter
Steve put together a program that produced spectacular results, and the quality of our communication and customer satisfaction is vastly improved. I’ve been in business for 40 years, and Steve’s the first consultant that I’ve gotten my money’s worth from. We’re going to continue to work with Steve and the bright, energetic people that are on his team.

Jim Winter

COO, Dimension Design
Doug Ducey
In one morning, Steve re-energized the way we look at marketing. The only question we had at the end of the session was, ‘When can we get him back?'

Doug Ducey

CEO & Chairman, Cold Stone Creamery, Governor of Arizona
Craig Dwight
Steve’s approach to integrating all customer contacts into a comprehensive marketing message is a must in today’s information age. We have partnered with Steve to develop our integrated and comprehensive marketing message, and as a result of his excellent work, his new book is required reading for all of our employees.

Craig Dwight

Chairman & CEO, Horizon Bancorp
roma-maxwell
Rancho La Puerta has enjoyed continued success because of the work we did with Yastrow and Company. Together, we implemented business strategies that have contributed to our success. Steve and his team truly believe in our brand, and our experience with them was empowering, fun and a great learning opportunity. I highly recommend Yastrow and Company to any business that needs help building the bottom line

Roma Maxwell

Roma Maxwell, Director of Sales and Marketing, Rancho La Puerta
Alex von Bidder
Steve Yastrow's teachings are applicable to any business that values long-standing success based on personal relationships.

Alex von Bidder

Managing Partner, The Four Seasons Restaurant, New York
Kathleen Phillips
Not only is Steve's content sound, but the energy he displays in delivering it will knock your socks off.

Kathleen Phillips

Ernst & Young, Chicago, IL
Marc Allen
We are absolutely better off after engaging Yastrow and Company. They helped us look at our business from our clients’ perspective, resulting in a cultural shift throughout our organization. These changes have made a big impact - we’ve gained new clients and strengthened relationships with existing clients. The investment was well worth it.

Marc Allen

Vice President of Sales, AMD Industries
Jennifer Whelan
“Steve’s workshops helped bring out what is best at Acuative. His insights were fresh and long-lasting—we continue to use his tools and approach years later.”

Jennifer Whelan

Vice President of Marketing, Acuative
Ditch the Pitch is a great read-- interesting, fun, and easy to follow. And I’ve already seen the concepts work. Just yesterday, I called a client and had a conversation that was 95% about the client, as the book suggests. At the end of the call, he sent a new matter my way. I ditched the pitch and it resulted in new business.

Attorney

Chicago, IL
Chris Miller
I rarely book speakers more than once. But I’ve used Steve four times! Steve has our association’s interest at heart and works tirelessly to deliver customized programs. He always ranks highly with our affiliates because he is outcome-focused, fast-paced and highly engaging. Anyone looking for insight and understanding into marketing, branding and sales should book Steve!

Chris Miller

Executive Director, Professional Systems Network International