To woo affluent clients the best weaponry is to repeatedly offer “bragging rights experiences” to your customer and client base.
The hospitality industry has been doing this for years.
In this podcast I outline the 3 key steps to success.
For people like me in marketing it is a very unwelcome fact: the higher up the financial food chain you go in search of clientele, the less likely you are to obtain a customer, client, or patient through advertising, direct mail, or other proactive outreach.
Oprah Winfrey does not look on Google for a chiropractor, nor will she be motivated by a late night TV ad. If she has back pain, she’ll reach out to her network for a recommendation.
To woo affluent clients the best weaponry is by repeatedly offering “bragging rights experiences” to your customer and client base. The hospitality industry has been doing this for years.
Golf resorts have been dispatching massage therapists to deliver a quick rub to sore shoulders or achy backs between greens. Hilton’s super upscale Conrad Hotel introduced the now popular “pillow menu” and individual concierges. Whilst St. Regis, introduced your personal butler.
You probably don’t operate a hotel or a resort, but you can learn a lot from the most upscale of them. The best have committed clientele, unwilling to stay elsewhere unless absolutely unavoidable, and urging their peers and friends to follow their lead.
Most businesses settle for whatever word-of-mouth advertising or specific referrals they get by accident, but in marketing to the wealthy, it is more vital to get them and each referral is so valuable, that a strategic investment of time and money is warranted.
There are three main strategies:
- creating experiences customers are motivated, preferably compelled, to tell others about – that is, being the basis for storytelling
- recognizing and rewarding those who refer
- tracking, measuring, and managing referrals
Steps 2 and 3 aren’t very useful without step 1, which is pretty obvious. But by taking the time to understand the psychological and emotional drivers of your wealthy customers’ buying behaviour and enthusiasm for what they buy and whom they buy from to crafting the most appropriate sales language and choreographing your sales process – all combine the Total Experience as felt by the customer.
That total experience determines a customer’s willingness to refer when asked as well as the likelihood of them spontaneously recommending you to others of their own initiative.
An important thing to understand is that satisfaction is not sufficient.
For example, there are many businesses I buy things from and do business with which I am sufficiently satisfied to continue as a customer. my dry cleaners, the local car wash, and my Accountant. But I have zero motivation to tell others about these businesses, let alone passionately urge others to use them.
On the other hand, I have actively referred people to my dentist; my graphic designer Troy, my favourite restaurant, Brika.
Why do I champion these businesses but not the others?
Because they do more than satisfy. They meet a higher standard. The secret to referral stimulus is the difference between satisfaction and enthusiasm, produced either by merely expectations or by exceeding them.
Getting recommendations and referrals from your clients is about turning them into storytellers about their experiences with you. Nobody gathers a crowd around at a cocktail party to tell them, “My dry cleaner gets my clothes clean, folds them, and puts them on hangers.” It’s just not much of a story.
Here’s why this is particularly important in working with affluent clientele: Surveys show that the affluent are 30% less likely than the general public to return or exchange unsatisfactory merchandise, seek out management to lodge complaints, or make their disappointments known. Their time is too valuable to spend on such activities. They simply go elsewhere. If the experience you are delivering is unsatisfactory or merely ordinary, you can’t rely on your wealthy customers to do your work for you and alert you to your mediocrity. You have to determine it, based on poor referral statistics or other statistical measurements and observation. Affluent consumers are, however, more demanding, even though they may keep their disappointments to themselves and go searching elsewhere for better experiences.
Peer Recommendations Rule
Abundant survey and statistical data supports the premise that, the more affluent the consumer, the more likely they are to rely, in whole or part, on word-of-mouth information and recommendations from peers in selecting stores, restaurants, products, services, and professional providers. If their interest is captured by advertising or direct solicitation, the wealthy consumer is at least four times (400%) more likely to ask their network about the company than is a consumer of average means.
With the affluent, word of mouth is far more critical. And far more valuable. And must be earned through complex creation and delivery of exceptional experiences that serve as basis for positive, interesting storytelling.
If you have all of this in place, you will get referrals. When you do, Strategy 2 (recognition and reward) should occur.
I cannot tell you the number of times I’ve heard the same unhappy story – “I sent my friend/ client/ neighbour to x and never got so much as a thank-you note.” Each person telling me that story is expressing deep resentment of not being shown deserved respect and appreciation, and reinforcing their determination never to recommend that business to anyone else. I don’t think most businesspeople understand just how much it irritates people who deserve appreciation but not get it.
This is multiplied with the affluent, who feel privileged to begin with and take the absence of appropriate response as a slap in the face. When they do you a favour, such as referring a customer, they are waiting for an appropriate acknowledgment.
The good news is that recognition and rewards motivate more of the same behaviour. I guess we can all be Pavlov’s dogs.
The best way to turn a first-time or occasional referrer into a frequent one is: recognition. And, the more affluent the customer, the more personal the recognition should be. They do not need a gift card that you buy a dozen at a time to reward referring customers. A personal, preferably handwritten thank-you note will do.
But, ideally, it’s best to find and obtain something of specific relevance to the individual or their business, family, pets, or personal interests. And you are developing even more “bragging rights experiences”.
Finally, Strategy 3 is holding yourself, your staff, and even your clients accountable for referral activity. This means measuring effectiveness every way you can, beginning with overall stats.
I often ask a professional service provider like a dentist or chiropractor to tell me how many referrals they’ve received per active patient this year to date vs. last year … and guess what – most of them have no idea.
You can’t manage what you don’t measure. Depending on the nature of your business, you may be able to measure one staff person’s efficacy at securing referrals against another’s. You can certainly track referral numbers, frequency, and consistency for each customer, client, or patient. The courageous marketer will single out the clients referring below par and engage them in frank discussion about it.
The point is that referral productivity is something to be proactively managed, not passively accepted, whatever it is.