The Lazy Man's Way To Increase Replacement Sales!
In many parts of the country, we're between seasons, and that often means a shortage of quality replacement leads.
If there were a way you could:
- Generate more solid replacement leads without spending a dime
- Decrease your advertising budget
- Use the assets you've already got more completely, and Satisfy "problem" customers...
- ...would you want to know more about it? If yes, then read on!
How it all began: I remember eleven years ago, when I was working as a residential replacement salesman, walking into my sales manager's office, sitting down and saying, "I would like the opportunity to continue working for your company."
He knew me well enough to just get a little half smile on his face, lean back and respond, "You're getting at something."
I said, "I don't want any more leads."
"You don't want any more leads?"
"I don't want any more leads, but I would like the honor and privilege of continuing to represent this fine company and sell it's quality products."
"How are you going to do that if I don't give you any leads?" he asked.
I said, "Sir, it's not really a question of how can I make sales if you don't give me any leads, it's a question of how I can make sales if you do give me leads." That really piqued his interest. "I know you mean well," I continued, "but the fact of the matter is that you're driving me nuts and wasting my time with a lot of the leads you're sending me on. We run terrific ads that really bring in the leads, but the people who respond to advertisements for replacement equipment are 'bid-takers.' They're people who definitely intend to get more than one bid. As a rule, they're price shoppers."
He wasn't crazy about what I was saying. After all, I was breaking the sales manager's credo, which states that every lead is a good lead. Well, every lead is a good lead and no leads should be prejudged, but some leads are "gooder" than others.
I continued with, "I'm not saying that a lot of the leads you're sending me on can't be sold, but what I am saying is that there are only so many hours in the day, and I'd rather go see the people I know I can sell."
"And how are you going to do that?" he asked.
I could tell he was beginning to get a little irritated.
I said, "You're spending thousands of dollars per year to have a telemarketing room to do 'happy checks' and generate leads, right?"
"Shut it down."
"Shut it down?"
"Shut it down," I said. I'll do the 'happy checks for you and I'll generate my own leads. All you need to do is flow a copy of each service invoice across my desk before it's filed. I'll take care of things from there."
The basis of my strategy: Who is the easiest prospect to sell? Some say it's a service customer, others say a service agreement customer, but everyone agrees that it is a person who has a specific need, and especially if it's a previous customer. The easiest prospect to sell is the active customer who has a problem, but wasn't in the market before meeting me. I do best when I make the prospect aware of the need and the solution at the same time, before they've thought about opening a bid-taking process. And that's the problem with running leads derived from advertising -- you know they plan to get, or have already gotten, other bids.
Now, I don't mind a little competition, but frankly, if I can completely avoid it, I will. "Happy checks" are great, but how much additional business can you directly attribute to them? None, when you do them the way most people do. Plenty, when you do them right.
Just so we're all reading off the same page, what I'm calling "happy checks" or "happy calls" are those follow-up calls you make to ensure that your customers are happy with the service they received.
Here's the funny part: When I listen to people make "happy calls", they ask the questions in a manner that conveys the message that they don't expect and don't want any complaints. Personally, and as a salesman, I hope they do have complaints.
Solving problems is what I do for a living. No problems-no sales. So I selected the people I knew would have a complaint.
From that day on, every residential service invoice was flowed across my desk before it was filed. As it works out, the company I worked for, and most of the companies I've consulted for, have one copy of the service invoice that is thrown away at some point. That's the copy that landed on my desk.
Making it even easier: I didn't call every service customer, but I did call some of them. "Pre-call planning" is one of the most important steps that any sales professional can take, so before calling anyone, I took a few moments to research the customer's service history. You see, I only called the customers I knew had older equipment and were having trouble with it. This helped me scale the list of possible phone calls down to a manageable size. It also gave me enough insight that, when I called the customer, I sounded more like the concerned professional that I am than someone who was just calling to sell them something.
The most likely prospects for replacement equipment, in order of priority, are customers with older equipment and:
Repeated breakdowns, with a recurring problem Numerous breakdowns with a different problem each occurrence Have had a lot of "callbacks"; have had problems that apparently are "unsolvable" Major breakdowns on older equipment. Obviously it really helps when your service techs fill their service paperwork out completely, that means:
Homeowners' complete name and address Telephone number Model and serial number of equipment Recommendations Brief report on the condition of the equipment.
These things need to be written directly on the service invoice, whether that information is available elsewhere or not. Making a person have to look up every customer on the computer just to tell the age of equipment will slow the entire process down and make it too cumbersome to do.
Once you start looking at service invoices regularly, in a very short period of time, you'llbe able to tell the age of equipment by its model and serial number. You'll also find hat you'll begin to recognize names. When you recognize a name, check their history. You're probably recognizing it because they've had another call recently. That means they're having trouble and could probably use your help. Help them to get rid of that old clunker that's eating them out of house and home in unnecessarily high utility bills and repairs.
You should also learn in advance whether or not the service call has been paid for. In order to establish a "sense of urgency" to their decision to replace, you'll also need to have a system in place that will allow you to credit all or part of what they recently paid to have their equipment repaired.
This is where having a preprinted package price list for replacement equipment comes in handy. It's a visual aid you can use to document the discount you give them. This way the customer knows you haven't pulled a price out of the air and artificially inflated it to make it appear as though you've given them a discount that you really haven't.
Now, here's the key: Your "book prices" should be based on what you would charge to install an air conditioner on the Fourth of July and what you would charge to install a furnace on Christmas day. These are your "regular retail prices" and you can discount them from there. This is perfectly legitimate. Nearly every product on the market, from shoes to cars to homes, has a "suggested retail price." As a rule, the consumer rarely pays the full "suggested retail price," do they? For the record, you'll probably accidentally sell at least one job per year at your regular retail prices, and that makes this all the more legitimate.
What to say: What do you say when you call them? Why not start with the truth? Try this: "Hello, this is (your name) with your heating and air conditioning service company. I'm not interrupting anything, am I?" Once they respond, continue by explaining, "I'm following up on your recent service call and wanted to know how your equipment is running and if you had any questions, complaints or comments about your service. "
If they've got any kind of a negative comment whatsoever (and you hope they do), say, "Tell you what, I'll come out and take a look at it myself at no charge, and we'll take it from there. Are you going to be there for the next thirty minutes or so?" Notice you don't sell the equipment over the phone. Don't even bring up replacing their equipment. Sell the appointment.
Suppose they've had more than one service call this season. Obviously, you know they're having trouble with it and, if you did your pre-call planning, you know they've got older equipment it would benefit them to replace. I might open the conversation in the same manner, but then make your coming to the home more matter-of-fact by simply stating, "Sir (or ma'am), I'm in charge of all the residential work here and any time we run more than one call in a home during any one season I come out and take a look at it, at no charge, to make certain you won't be inconvenienced any further." Again, I didn't say anything at all about replacing their equipment at that time. Why should I? I haven't even seen it yet. I believe it would be inappropriate of me to recommend replacing equipment before even looking at it.
What to do in the home: What do I do once I get in the home? Exactly what I said I was coming out to do. I look the equipment over. If it's in bad shape, I'll let them know. If it looks fine, I'll let them know that, too. I make the conversation a positive experience and know that they'll buy from me eventually. I don't need to lie or high-pressure anyone just to make a sale when I can make another phone call and go see someone else who might have a legitimate need I can meet.
Say they've had refrigerant added every year for awhile. You might bring up the subject of replacing their equipment by asking, "If there were a way that you could save the expense of having that done every year, save money on your utility bills, increase your comfort and get back the money you just paid for service work, would you want to know more about it?" That's two sales techniques in one. First, it was a question bearing on a need, which I learned when I took the Dale Carnegie Sales Course. The second is what I call "stacking the benefits," where I load all the benefits of ownership into a single sentence. That's my own invention.
The biggest problem you'll have with this technique:
How many telephone calls do you think you'll have to make to land an appointment?
Very, very few.
In fact, occasionally a salesperson I'm working with will say to me, "Charlie, I've got a problem with calling all of these service tickets."
I'll say, "What's that?"
They'll say, "Well, they'll all let me come out!"
That's quite a "problem" for a salesperson to have, isn't it? That's why it pays to learn as much about the customer as possible before calling.
This system is, in many ways, a salesperson's dream because they can actually pick and choose who they want to see. You call a prospective replacement customer and, if the conversation goes well, you go on out and see them. If things don't go well, you call someone else. It's simple. You use your time more effectively, you have a higher closing ratio, you're taking care of customers who have problems and you're cutting your advertising costs. That's why I call it, "The lazy man's way to increase residential replacement sales. "
Does it take a little effort to do your research and dial a few telephone numbers? Sure, but not near as much effort as driving all over town running the pointless leads that are set by someone other than yourself. So listen, don't have someone else make the calls for you. That's the exact opposite of what I'm suggesting. Having someone else set your appointments for you puts you back in the same position you're already in, someone else is in control.
What to expect: Let's look at calling four people per day. More than likely, all four of them will be willing to let you come out to the home, but let's say you're the selective type, so of that four, you're going to go out and see just one. Do that five days per week and you'll be visiting with five customers per week. That's five solid leads per week times fifty weeks per year. That's 250 of the best kind of leads per year-existing customers with a serious problem that weren't even in the market until they met you, and have a sense of urgency to not only make a decision, but to buy from you!
The closing ratio for leads run with existing customers is at least 70%. 70% of 250 leads is 175 sales. With an average sale of $5,000, that's $875,000 in replacement sales per year due to your making an average of four telephone calls and visiting with one customer per day. Does any part of this seem exaggerated to you?
I know a guy who made it a goal to sell $100,000 in replacement sales in one week, exclusively by using this technique, and he made it! By the way, it was his first week of trying this.
Of the 30% that don't buy, if you'll make it a brief, positive exchange, you'll have a solid contact for a future sale.
You could make the same number of telephone calls per day but, instead of seeing one person per day, you could see two, and your volume from this lead source alone would jump to over $ 1,000,000 with no advertising expense!
There are full-time equipment salespeople who don't sell that much in a year by running leads. This, you're doing part-time.
Here's a point that is essential to understanding the philosophy behind this technique. You're not a predator and you're not taking advantage of anyone. They've already paid for a repair and you could have left well enough alone. Instead, you're allowing them to apply the money they spent on new equipment that will save them money.
You're doing them a favor.
Since self-generated sales have no acquisition cost, salespeople should be paid a bonus commission over and above their normal commission on self-generated sales.
Most of the HVAC companies I've consulted with have way, way more sales opportunities than they're using. Your service tickets, the paper left behind when a service technician writes an invoice, is your company's most valuable, and in most cases, neglected, commodity.
I don't do this any more, but when I used to be hired by HVAC contractors to interview, recruit and train a residential replacement salespeople, one way I knew I had a good candidate was by showing the prospective salesman some service tickets and asking: "Can you believe we never call these people back to check out their equipment or to see if they want to replace it or anything?"
The good ones say something like, "You're kidding! Would I be allowed to call them? I mean, these are your customers ... and they've been having trouble with their equipment... and you sell equipment... AND YOU DON'T CALL THEM?!"
So, when things get a little slow, don't spend money on advertising for bid-takers.
Just pick up the phone and make some money!
Want to learn more about this and other techniques for generating residential replacement sales?