That’s an alarming stat’ that I can guarantee within only a few percentage points, applies to most businesses.
Consumers base their decision to buy on 3 levels of criteria.
Firstly, a whopping 50% of consumers will choose someone they already know and with whom they have a relationship, to do business. They don’t respond to ads or postcards, they don’t reach for the Yellow Pages, they go straight to the same person they ALWAYS go to.
YOU want to be such a business, one your clients automatically think of and go to without even considering looking elsewhere.
Of the other 50%, 25% of these will make their decision to buy based on a referral from someone they trust.
The final 25% will refer to ads, Yellow Pages, television advertising etc, when they want to do business.
Why do so many people prefer to have an established relationship with the person or company they do business with? Well it’s human nature, we’re creatures of habit and knowing what to expect makes us feel nice and secure. This holds true more with ‘low risk’ decisions such as buying the same hair shampoo over and over again, than when buying a new house every few years.
But what this tells us quite clearly, is that no matter what vehicle you use, you and I are not in the business we think we’re in! No the business we’re REALLY in is the business of RELATIONSHIP ACQUISITION and MANAGEMENT.
The extra bonus is if you nurture the relationship you have with your clients, they will forgive you when you do occasionally mess up! People will even accept sub standard service from vendors if they have an established relationship going. Think about it, it’s likely that you patronise a business regularly even though you know it’s not the most efficient or the best, because you are comfortable with the owner; they know your children by name or you know they have a laugh with your wife/husband. You can overlook the occasional stuff-up, simply because you know them and you like them.
The U.S. National Association of Realtors profile buyers and sellers and they report that when 48% of people are buying or selling their home, rather than respond to an ad or look around their neighbourhood and contact agents listed on signs, they will list with someone they know and have had a PRIOR RELATIONSHIP with.
After that, 26% will make their decision from talking with a trusted source or a referral by a friend. It was reported in the National Association of Realtors, that a whopping 74% of all decisions are derived from a relationship!
It was also reported, and it is fascinating that only 4% of agents operate some kind of relationship ‘harvesting’ contact programme. Only a miniscule 4% of agents are getting 75% of the business! They are getting the lions share.
Armed with such enlightening and empowering knowledge then, where do you want to spend your marketing $$$?