I run my family’s auto shop. We’ve been in business since 1933. Some of our best customers got their first service before I was even born.
Joe Pizzingrillo comes to mind. His kids were tiny when I got started at the shop. Now they’re grown up and happily married. His family trusts me with all of their automotive needs.
Everybody’s worried about finding new customers. Business owners read books, go to seminars, and consult the Internet for new marketing tactics. There’s nothing wrong with that, but most people fail to realize a simple truth. The best way to get more customers is to take care of the ones you have.
The first time Joe rolled into my family’s shop, he had one car. Now he has two. The first time I met his three children, they were toddlers. Now they’re driving cars, and so do their spouses. Do the math. Joe showed up with one car to maintain. Fast-forward a few years and we’re servicing seven more cars.
Do you see how powerful that is? If you can convince 12 customers to send eight referrals this year, you’ll be close to 100 new accounts without spending a dime on advertising.
Investors talk about the effect of compound interest. Here’s a definition from Merriam-Webster.com: “Interest paid both on the original amount of money and on the interest it has already earned.”
Sound like gobbledygook? I agree! Let me demonstrate what that means. If you put $100,000 in an account that earns an average of 10 percent per month and leave it alone for 10 years, it will grow to $259,374.25.
The same effect is at play in the story I shared. My family appreciated Joe for his business right away, but it wasn’t enough money to make a big difference on our long-term profitability. As time passed, that changed in a significant way. Joe has directly made us more than $50,000 over the years.
A couple of columns ago, we discussed educating customers. Drivers need to understand the repair’s purpose. Otherwise, they will be resistant. These concepts are directly related.
For example, a driver named Michael came to my shop for an oil change. After the inspection, we discovered his tires needed to be replaced.
We showed him the problem, but he chose to delay—until he got a flat tire. It was a good life lesson. Some people need to learn the hard way. Keep that in mind when customers don’t invest in a service, despite your best efforts. If their car breaks down later, they’ll regret not listening to you.
Michael did. He came back to buy new tires. He got caught up with his vehicle’s scheduled maintenance. At first, he was a procrastinator. Now he is proactive and responsible. Michael told his friends about us. In a few short months, he has brought in thousands of dollars’ worth of referrals.
If you want referrals and repeat business, you have to connect with your customers in a way other shops don’t. People don’t want to work with cold and calculated mechanics. They are looking for care and connection.
Today, more than 70 percent of our new customers come through referrals, but I don’t view Joe or Michael as numbers on a balance sheet. They’re human beings with distinct needs. I’ve gotten to know them on a personal level. Why else would they want to help me succeed?
Take care of your customers and they will take care of you. I know it sounds too easy, but it’s true.