The Myth of Goodwill

[exodus]

here is my experience on good will and word of mouth.

i think it's a myth. Particularly in the computer shop/service industry. How many friends do you have? Most people have little more than one to a handful of friends. it's the modern world where people don't even know their neighbours anymore. Out of that handful of friends and family how many have a computer? Of that segment how many would consider paying a tech to fix it rather than a family member or friends, or fix it with the help of google? the numbers of potential referrals have dwindled right?

I tend to do a good job out personal self esteem. It's how i am. I do what i do to best of ability. But i don't think goodwill exists in this service side of things. No matter how good you are.

what do you think? i know some people in a community or village in the uk are different, but in the average aussie suburb you'd be pushing it to get referrals.

 

[wavey]

I get this kind of referral just about every day, 'you fixed my friends/brothers/mothers laptop,he/she said you are great can you fix mine?'
I don't have to advertise much, it just comes in through the door.
Maybe it's different in Australia?

 

[GTP]

I have been running a successful business on word of mouth the past 15 or so years.
I advertised before that and at other times through the years since but for no result.
People are so over advertising, they just don't bother to notice it any more.

 

[Mick]

h How many friends do you have? Most people have little more than one to a handful of friends.

Nonsense. My son has 2036 friends. Mind you, he is on FB...

 

[Diggs]

Word of mouth is huge here. At least 50% of my new business comes from someone knowing someone that loved the work I did for them.

 

[sapphirescales]

TOTALLY disagree with you here. I live in a major city of about 100,000 people and there's about 1,000,000 people within a 10 mile radius of me. It has nothing to do with area. When it comes to service related things (i.e. handyman, lawyer, hair dresser, computer repair tech, accountant, etc.), there are good ones and there are bad ones. MOST of them are bad. The only way to find out which ones are good is to talk to people that have already used them. I get a TON of referrals.

You know how I found my auto mechanic? I started asking every client that came through the door and one name kept coming up. His shop is in the middle of the ghetto. It's a tiny little shop that's been there for nearly 100 years. I NEVER would have considered this shop if it hadn't been for so many clients recommending it. And he's good. REALLY good.

I was out with my mother a few days ago and we went out to a restaurant. She liked the waitresses hair so she asked who did it. Now she's made an appointment with that hair salon.

My current handyman was recommended to me by the saleswoman at Best Buy. I loathed to step into that place, but I was looking for a new washer/dryer and they were the only ones that had the model that I wanted on the actual sales floor. With Sears going under, their selection was pretty slim. He knows what he's doing and does things right, but he's not detailed, so I'll be looking for a new handyman soon. But still, I had been through three other handymen that had screwed things up so he's the best I've found so far. This guy has NO website, and doesn't even advertise online at all. He has no storefront either. It's all referrals.

I'm sorry to say that if you're not getting referrals, you're not doing something right. It doesn't matter if people know their neighbors or not, or if they have any real life friends. You can't help but talk and interact with people on a daily basis. If nothing else, you should be getting referrals from other family members even if you're dealing with rather reclusive people. This is my life that I'm talking about here, and I don't even have a typical job! Most people are interacting with tons of co-workers in addition to every other interaction they have everyday. There are tons of opportunities to talk about the new service you found and how good it is...or to badmouth the heck out of a service that you found distasteful. So you've gotta be careful.

 

[fencepost]

Just because this came up in another thread recently, free work in hope of referrals is going to get you just as many or few as paid work, but they may be referrals in hope of getting more free work from you.

That said,

• Is it easy for people to refer you? Can they say "Talk to XYZ at easytorememberdomain or easytosearchforcompanyname"?
• Are you asking for referrals? "Hey, you did a great job, thanks!" "You're quite welcome, and thank you. If you run into anyone else needing service, please pass my name along."
• Do you reward referrals? I know this is something that's come up at various times, not sure what the consensus is on it.
• Are you asking how people heard about you or found you?

I highlighted and bolded the first one because if it's hard to search for your company due to spelling or being "Bob's Computer Repair" then you might be getting referrals - they just never make it to your door because they can't find you. The domain name may be less important, because these days most of your customers aren't going to go to that - they're going to go to Google (or Bing in Edge) and search for whatever your customer told them.

 

[mraikes]

Interesting thoughts. And although I get all the word-of-mouth referrals that I want right now, I still agree with OP to some extent.

Personally, I can't recall anyone asking me for a referral on anything apart from "what kind of computer should I buy?" business related questions. But mechanic? Best restaurant? Cleaning lady? Nope. And I'm not the kind of person to bring up such things. "Oh, I can't wait to tell you about the greatest Barber I found!" Said me never.

I imagine community and culture are primary drivers of word of mouth business referrals that many of us take for granted. There must be some places in the world settled by a bunch of people like me - close mouthed and not very outgoing about such things. In that environment, there wouldn't be many referrals no matter how good someone is. And since people tend to complain more than they compliment, that would be a double-whammy in a community like that.

I know there's a lot of stuff out there about how to get more referrals, but I think it's mostly baloney. Referrals are by nature the most organic and elusive way to grow a business. And they pretty much have to just happen - but you still have to make it easy for them to happen:
- Don't give someone one business card, give them three. When they ask why three? You say for two of your friends. And chuckle.
- If you hear from a customer that they might know someone who also needs help, try to get that info, contact the other person and namedrop unmercifully.
- If someone says they'll pass your name to a friend, make the referrer feel important by mentioning how busy you are but if that friend mentions the referrer, you'll be sure to get them taken care of right away. Everyone likes to be "that guy" whose name breaks through barriers.
- As already mentioned, make your website ridiculously memorable and easy to find online.

And I might mention that getting a decent referral-ball rolling can take a long time. But OP has already been around a while, so if referrals still aren't happening that's probably not the reason why.

 

[callthatgirl]

The only referrals I get are usually from techs, passing over a client. I think my own clients don't want their friends to know what a mess their Outlook was an how much it cost to fix lol.

 

[exodus]

some very interesting points in this post.

i should have also explained in my original post that i have survived the decline of computer industry with the switch to phones and tablets like ipads, by having a very loyal customer who frankly tell me they would never consider using anyone else.

i fix everything pretty much at a reasonable price. i also have a $49 charge for 30mins online. but of all these loyal customers i would guess only 5% have referred me.

and like the post below explains, i have a mans barber who comes from iran, he is by far the best i've ever had and costs half the price. yet i've never had the opportunity or circmstance to say, hey i know a great barber.





QUOTE="mraikes, post: 637351, member: 10939"]Interesting thoughts. And although I get all the word-of-mouth referrals that I want right now, I still agree with OP to some extent.

Personally, I can't recall anyone asking me for a referral on anything apart from "what kind of computer should I buy?" business related questions. But mechanic? Best restaurant? Cleaning lady? Nope. And I'm not the kind of person to bring up such things. "Oh, I can't wait to tell you about the greatest Barber I found!" Said me never.

I imagine community and culture are primary drivers of word of mouth business referrals that many of us take for granted. There must be some places in the world settled by a bunch of people like me - close mouthed and not very outgoing about such things. In that environment, there wouldn't be many referrals no matter how good someone is. And since people tend to complain more than they compliment, that would be a double-whammy in a community like that.

I know there's a lot of stuff out there about how to get more referrals, but I think it's mostly baloney. Referrals are by nature the most organic and elusive way to grow a business. And they pretty much have to just happen - but you still have to make it easy for them to happen:
- Don't give someone one business card, give them three. When they ask why three? You say for two of your friends. And chuckle.
- If you hear from a customer that they might know someone who also needs help, try to get that info, contact the other person and namedrop unmercifully.
- If someone says they'll pass your name to a friend, make the referrer feel important by mentioning how busy you are but if that friend mentions the referrer, you'll be sure to get them taken care of right away. Everyone likes to be "that guy" whose name breaks through barriers.
- As already mentioned, make your website ridiculously memorable and easy to find online.

And I might mention that getting a decent referral-ball rolling can take a long time. But OP has already been around a while, so if referrals still aren't happening that's probably not the reason why.[/QUOTE]

 

[sapphirescales]

yet i've never had the opportunity or circmstance to say, hey i know a great barber.

"Oh, I can't wait to tell you about the greatest Barber I found!" Said me never.

What is it with people talking about barbers? There's a HUGE difference between someone like a barber and someone that offers professional services (handyman, computer repair technician, lawyer, etc.). The difference is, a barber really is not that important in the grand scheme of things. If you go to a bad barber and your hair ends up looking like crap, you shrug it off, wear a hat for a week, and don't go back. It's not the end of the world if you get a bad haircut because it will just grow back. But a lawyer? He screws things up and you're in DEEP sh*t. If your computer guy screws up and you lose your $500 computer, or your data, that's REALLY BAD! You get a bad $5 haircut? Well, that sucks. But it's no worse than getting lettuce on your burger when you ordered it plain. You just either take it off or have the order corrected.

 

[mraikes]

What is it with people talking about barbers? There's a HUGE difference between someone like a barber and someone that offers professional services (handyman, computer repair technician, lawyer, etc.). The difference is, a barber really is not that important in the grand scheme of things. If you go to a bad barber and your hair ends up looking like crap, you shrug it off, wear a hat for a week, and don't go back. It's not the end of the world if you get a bad haircut because it will just grow back. But a lawyer? He screws things up and you're in DEEP sh*t. If your computer guy screws up and you lose your $500 computer, or your data, that's REALLY BAD! You get a bad $5 haircut? Well, that sucks. But it's no worse than getting lettuce on your burger when you ordered it plain. You just either take it off or have the order corrected.

Wow, did a barber run over your dog when you were a kid?!

While I see your point, I can value more than just one or two kinds of service providers. And
I utilize my barber more often than my handyman, lawyer, accountant, or probably any other professional.

Yeah, I can survive a bad haircut and a bad barber. But a good barber, that remembers me, remembers what kind of haircut I like, knows I'm not there for chitchat, remembers that darn mole on the side of my head to avoid drawing blood, is conveniently located, isn't so busy that I can't stop in when needed..... Well, that's a guy I can appreciate even if you don't.

 

[exodus]

well i hate to be teaching life skills to a grown man but cripes, the barber is just a general analogy. it doesn't literally mean a barber for goodness sake. i don't know why you had to focus so much attention and writing on your opinion that barbers don't matter. to me, they do matter, especially the barbers around here are charging as much as the hairdresser to cut a mans hair and my barber charges only half that.

What is it with people talking about barbers? There's a HUGE difference between someone like a barber and someone that offers professional services (handyman, computer repair technician, lawyer, etc.). The difference is, a barber really is not that important in the grand scheme of things. If you go to a bad barber and your hair ends up looking like crap, you shrug it off, wear a hat for a week, and don't go back. It's not the end of the world if you get a bad haircut because it will just grow back. But a lawyer? He screws things up and you're in DEEP sh*t. If your computer guy screws up and you lose your $500 computer, or your data, that's REALLY BAD! You get a bad $5 haircut? Well, that sucks. But it's no worse than getting lettuce on your burger when you ordered it plain. You just either take it off or have the order corrected.

 

[exodus]

well i hate to be teaching life skills to a grown man but cripes, the barber is just a general analogy. it doesn't literally mean a barber for goodness sake. i don't know why you had to focus so much attention and writing on your opinion that barbers don't matter. to me, they do matter, especially the barbers around here are charging as much as the hairdresser to cut a mans hair and my barber charges only half that.

oh and also, how on earth do you put computer repair technicians and lawyers in the same sentence??

 

[timeshifter]

Some people are influencers. It's been a while, but I remember reading a book about it. Paul Revere was an example. Wish I could tell you more clearly, but what I remember is that out of 100 people about three of them will be influencers and the ones who have the power to refer to you.

I remember at least one person like that about 10 years ago when I was getting started. A significant portion of my customer base stems from her referrals. So if you have 100 customers you've served, three of them might give you multiple referrals, while the other 97 will refer two total between all of them. Not that you're doing anything wrong, that's just the way it works. (Wish I could remember the book I read on the subject)

 

[exodus]

now that was an interesting post timeshifter and closer to the real world truth about referrals. I had one of those influencers recently who referred to her group as she called it. I had a carpet cleaner, a lawnmower guy and a vet referred to me in a short space of time. I wondered what made her like this. Now I see. Makes perfect sense.

Some people are influencers. It's been a while, but I remember reading a book about it. Paul Revere was an example. Wish I could tell you more clearly, but what I remember is that out of 100 people about three of them will be influencers and the ones who have the power to refer to you.

I remember at least one person like that about 10 years ago when I was getting started. A significant portion of my customer base stems from her referrals. So if you have 100 customers you've served, three of them might give you multiple referrals, while the other 97 will refer two total between all of them. Not that you're doing anything wrong, that's just the way it works. (Wish I could remember the book I read on the subject)

 

[sapphirescales]

@exodus @mraikes
I care about what barber I use just about as much as the bagging guy at the supermarket. I'll survive a bad barber just like a bad bagger. I really couldn't care less. But someone screwing up your car/computer/house or screwing something up legally is a big deal. My barber sucks. I don't care. He charges $25. I don't care about that either. He's 2 minutes down the road and I can be in and out of there in 15 minutes. I could probably find someone better, and maybe someone cheaper. But really, so long as the hair doesn't grow so long that it's in my ears I'm good. I wear a hat all the time anyway. I've had a crappy barber ever since I moved to this state nearly 10 years ago. After the fifth or sixth one, I just stopped giving a sh*t and went with whoever was closest and could get it done the quickest. I've never badmouthed my crappy barbers, and if I found the best barber in the world I wouldn't talk about it. It just doesn't matter in the grand scheme of things. I'm more likely to talk about a good toilet paper than a barber.

 

[exodus]

some people just want to turn this discussion into a barber shop chat. case is closed however thanks to the statistical analysis proffered by timeshifter.

it works out exactly with the results i get in the real world. all those who claim to run their business on referrals alone, as Mick says in the movie The Castle, you're dreamin.

@exodus @mraikes
I care about what barber I use just about as much as the bagging guy at the supermarket. I'll survive a bad barber just like a bad bagger. I really couldn't care less. But someone screwing up your car/computer/house or screwing something up legally is a big deal. My barber sucks. I don't care. He charges $25. I don't care about that either. He's 2 minutes down the road and I can be in and out of there in 15 minutes. I could probably find someone better, and maybe someone cheaper. But really, so long as the hair doesn't grow so long that it's in my ears I'm good. I wear a hat all the time anyway. I've had a crappy barber ever since I moved to this state nearly 10 years ago. After the fifth or sixth one, I just stopped giving a sh*t and went with whoever was closest and could get it done the quickest. I've never badmouthed my crappy barbers, and if I found the best barber in the world I wouldn't talk about it. It just doesn't matter in the grand scheme of things. I'm more likely to talk about a good toilet paper than a barber.

 

[fencepost]

We ran our business for years almost entirely on referrals - still do for that matter, but we lost our great source so it's been downhill for a while and the current wave of hospitals or huge medical groups purchasing small practices is killing us (-25-30% of endpoints so far this year, with another 15-20% coming in a couple months).

Those referrals were all coming from a good-sized accounting firm that was one of our clients and that focused on small to midsize businesses. Some of those accountant senior partners were in 5-6 (or more?) different small businesses every week, and if the company was having computer problems they'd steer them our way. That was golden in so many ways - we knew those referrals were most likely fine financially (or at least had a professional business accounting firm working with them), we had a trusted "in," etc.

So, I absolutely believe that referrals can make or break your business and that you can get by with referrals as your only advertising.

 

[exodus]

i suspect you are not being entirely forthcoming with this story. It sounds very much like an arrangement with a lucrative carrot. An accountant would not extend energy and time if it was not a healthy incentive. So this doesn't fit the scenario of referral in the gist of what we are talking about.

We ran our business for years almost entirely on referrals - still do for that matter, but we lost our great source so it's been downhill for a while and the current wave of hospitals or huge medical groups purchasing small practices is killing us (-25-30% of endpoints so far this year, with another 15-20% coming in a couple months).

Those referrals were all coming from a good-sized accounting firm that was one of our clients and that focused on small to midsize businesses. Some of those accountant senior partners were in 5-6 (or more?) different small businesses every week, and if the company was having computer problems they'd steer them our way. That was golden in so many ways - we knew those referrals were most likely fine financially (or at least had a professional business accounting firm working with them), we had a trusted "in," etc.

So, I absolutely believe that referrals can make or break your business and that you can get by with referrals as your only advertising.