VidBit: The Referral Engine

The Referral Engine by John JantschEvery small business owner gets their start through referrals – from family, friends, or the first paying client. Over time this word of mouth advertising helps the company grow and expand… and ironically lose site of the power of the referral – or become unsure how to cultivate them as the size of the company means less face time with each customer. The Referral Engine: Teaching Your Business to Market Itself by John Jantsch is a fantastic book for those looking to create a structured system of creating referrals. John is also the author of the well known book Duct Tape Marketing.

More sales are welcome, but the best part of referred prospects are that price becomes less important, as John puts it, “when your business comes highly recommended by a friend, the role of risk is minimized, and that fact alone moves the significance of price comparison down the list.” He talks about how non-referred prospects may instead think to themselves, well if I’m disappointed with the result… at least I won’t overpay!

Are you sick of having to justify your price – or worse… negotiate away your margins? This just might be what you’re looking for.

Below is a brief video by John to give you a taste, however if you want specific actionable strategies you’re better served to pick up the book for yourself. Highly recommended.

A Builder’s Online Strategy: Emphasize Your Differences

Emphasize Your Differences - Home Builder Web Strategy

Quick review – the 7 E’s are:

1. EARN Google’s trust
2. ENTICE people to visit your site
3. ENGAGE those “just browsing”
4. EMPHASIZE your differences
5. ENSURE you’re part of the short list
6. ELICIT a response – generate a lead and convert it
7. EMPLOY your happy home owners to earn more trust

So now that a customer is on your site and devouring your relevant and helpful content, what bigger picture message are you sending them? When you follow up later (you’re going to follow… right??!), what key points about you do you want them to remember? Don’t spend time telling them “yes, we do that to.” You want to stand out and you want to be memorable… maybe even remarkable. You’re only going to accomplish this by highlighting your unique and honest differences.

Focus on no more than 2 or 3 main points so they can be easily remembered and repeated to other influencers in the decision making process.

Back up each point with 2 or 3 extremely specific examples.

This specificity does two things. The first is that it proves you aren’t lying or over generalizing. The second is that because it’s so specific, your prospects minds automatically will fill in the other gaps in information with the assumption that your company must address those things with a similar level of care.

Below are a few of the pitfalls I see builders fall into in their attempt to emphasize their differences. Unfortunately, they try to hang their hat on one of these four danger areas:

“Quality” is not a difference that’s believable a lot of the time

As a home builder, you are assumed to have good quality unless proven otherwise… because you’re a home builder. I’m not saying it’s right, I’m just saying that’s the way it is. We often do the same with doctors or dentists and do little background work on them because we assume they got the degree, so they must be good. Especially to uneducated buyers – the level of perceived quality difference will be extremely small unless heavily educated by a sales person they genuinely like and trust.

“Green” is not a difference that more than 14% of the population cares about.

I’ve done two separate surveys of over 800 consumers in my local area over the last two years. Only 10-14% say that a home being “green” would be a key part of their decision to purchase. Nearly two thirds said energy savings above and beyond other homes would be. A far distant second was indoor air quality. The generic term “green” doesn’t tell them “what’s in it for me.”

“Service” is something often promised and usually ignored in all forms of business.

Today’s consumer is jaded. Everyone tells them how much they care and will be there for them, and then they are disappointed time and time again. So even if this is a true point of differentiation – don’t say it yourself. You must use third party testimonials or awards to back it up.

“Affordability” is a difference, but one that raises questions as well – be careful with this one.

There are a lot of home builders out there – especially today – that have their prices set too low. Yep, I said it… too low. You don’t need to be $40,000 – $100,000 less than the competition on your base house. That just raises the question of how much you’ve cut out (it’s the fastest way to make an uneducated buyer doubt your quality… see above!). Small differences in price really matter. When my wife and I bought our first semi-custom home we ended up choosing the lot based on a $500 price difference on a $275,000 purchase. Not too rational, but then again your buyers aren’t rational either.

VidBit: Delivering Happiness: A Path to Profits, Passion, and Purpose

Delivering Happiness: A Path to Profits, Passion, and PurposeWhat kind of person would offer new recruits $2,000 to quit before training classes were over? Or encourage his employees to help customers order a pizza at 2am? A successful entrepreneur and customer service and company culture visionary – Tony Hseih, the CEO of In 2009, was sold to for $1.2 billion.

His insights are all valuable – and applicable – to your business. They may run contrary to the way most companies are run, but that probably only serves to prove that he’s on to something BIG.

“…we ultimately came to the realization that a company’s culture and a company’s brand are really just two sides of the same coin. The brand is just a lagging indicator of a company’s culture.”
- from Delivering Happiness