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Insight from a client


General Business Discussions

A place to talk about general business discussions.
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  #1  
Old 01-22-2012, 02:22 PM
TiedemanLLC TiedemanLLC is offline
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So at the end of every season I always send out a survey to clients asking about our services and demographic. This year I did something a little bit different. I have one client, that is completely honest when it comes to things. She is also one of my best clients, and has a great attention for detail. I love that she is picky about things.

I sent her around seven questions that ask for more detail information about our services, the pros and cons. I basically asked her to spend a little extra time telling me what she thought. These weren't questions to answer yes or no. I wanted detailed, paragraph answers.

All of the answers were great information, and gave me a lot of insight into things. However one thing that really surprised me was why my referral discounts weren't working.

I basically asked her, "We offer referral credits to clients, however very few clients use these $30 credits, what is something that we can offer as an incentive that you feel will make our current clients refer their family, friends, and co-workers for our services?"

She said that the reason she doesn't refer us is because she doesn't feel comfortable because of how high our prices are.

The past few years we could not figure out why our referral discount program has not been working well. It has actually declined since we have raised prices. But this little insight gave us the information that we needed, but at the same time has left us scratching our heads of what to do next with the lack of referrals.
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Old 01-23-2012, 12:14 PM
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So after thinking about this, what different paths do you feel you could take in dealing with this issue?

Also, how big of an issue do you feel it is?
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Old 01-23-2012, 01:26 PM
TiedemanLLC TiedemanLLC is offline
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Originally Posted by Steve View Post
So after thinking about this, what different paths do you feel you could take in dealing with this issue?

Also, how big of an issue do you feel it is?


Believe it or not we still haven't decided what to do. The first reaction is to lower prices across the board. We are probably the most expensive service provider in this area, and we did a major price increase last Spring. So our first thought is to lower prices.

It's funny, because when we did our survey to the rest of our clients we found out that their income levels were not as high as what we thought they were. So there is another red flag.

This is where I have an issue with though. I have always been a firm believer in providing a high quality service at a high price. Which we have always done. I am afraid that if we lower our price we may attract less than desirable work, and not be able to shift through all of the "less profitable clients"

I know we have to constantly adapt, but lower the prices is one area that I never thought we would ever do. We are at a crossroads with the business right now.
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Old 01-23-2012, 01:38 PM
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I think I would ask her for some more advice..
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Old 01-24-2012, 05:41 AM
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Wow, yea that would have me scratching my head too. But as chaz said, I beleive I would go see her and ask her what she thought about it and if she had any suggestions.

As far as your questionaire, did you get a good response in having them filled out and returned? If so how did you do that, and did you offer them any incentive to send it back?
Thanks.
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Old 01-24-2012, 09:35 AM
TiedemanLLC TiedemanLLC is offline
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Wow, yea that would have me scratching my head too. But as chaz said, I beleive I would go see her and ask her what she thought about it and if she had any suggestions.

As far as your questionaire, did you get a good response in having them filled out and returned? If so how did you do that, and did you offer them any incentive to send it back?
Thanks.
My first set of surveys I sent out to everything I basically just asked for some help with ways to improve our service. I more or less told them that by answering the survey this will improve their service.

With these questions (in which I received the referral credit insight) that I sent out I actually asked ahead of time if they would mind filling out a questionaire with more detailed answers.
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Old 01-24-2012, 10:27 AM
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if I am reading this correctly ,you are seriously looking into lowering your prices because one lady told you thats why she doesnt recommend your services to others ? That may be the case with her ,but is it not possible that she is the only customer that feels this way ?
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Old 01-24-2012, 10:40 AM
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if I am reading this correctly ,you are seriously looking into lowering your prices because one lady told you thats why she doesnt recommend your services to others ? That may be the case with her ,but is it not possible that she is the only customer that feels this way ?

Let me give a little more detail with the situation to help you better understand things.

When I sent out my first set of surveys back towards the end of 2011 I found out that most of my clients income level was lower than expected. With the survey we also found out that more than half of our services they thought were high in price compared to other competitors. I figured out that this is why some of my marketing pieces, especially the ones with installation work, fell on deaf ears. It was because they couldn't afford the outdoor kitchens or the landscape lighting systems. So more or less I found out my current clients have a lower income than what I expected. All of this time I was marketing for the higher priced services.

Now when I sent out this survey and received the response from her, I started to put two and two together. Our referral system has not been working at all. We have tried all sorts of incentives and still it hasn't lived up to our expectations. So with her response we found out that she didn't feel comfortable passing our name on because she knew other people couldn't afford our services and she didn't want to be looked at badly for giving out our name to someone else that couldn't afford it. Perhaps she also felt how others would look at her for "being able to afford" a high price service.


We put the two surveys together and realize that

1) Our clients make less money than what we thought

2) They already feel our prices are high compared to others

3) We lost a lot of clients this past season because they couldn't afford us anymore. They were cutting back on expenses.

4) Clients are not referring us because they think their friends, and family can not afford us.


So it all goes back to price. Out of all our surveys it never came back to quality, every single time it was price.
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Old 01-24-2012, 11:19 AM
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well at least you know your quality is good!
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Old 01-24-2012, 11:41 AM
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I have to lower my prices slightly this year, or have my clients pay more tax than last year for my services. It's a lose lose in my area.

From experience, keeping the customer top priority will kill you but sometimes we have no choice.

Lawn maintenance has become the next 'fast food' type of business. Get as much work as you can, and do it faster and faster to survive while maintaining a level of quality to keep you in the game.

There are two choices we can make;

a) let the ones who can't spare anymore money walk. Obtain clients who can afford your price.
Time consuming gamble for small business.

b) increase your productivity, work even harder, reach all audiences.
Friggen annoying, God is laughing at us.
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