FOLLOW UP WORKS!

By McKay Christensen
Executive Vice President

When I was going to MBA school there was a large upheaval in the way American companies were doing business. Japanese companies were outpacing and outselling American car and electronic companies, and companies outside of Japan were struggling to keep up. At the time, it was estimated that a Japanese-made automobile would last longer and require fewer repairs, thereby giving a more delightful customer experience than the average American-made car would. Domestic automakers went through years of reengineering to make total quality an ongoing part of their operations. The results were that small changes made to increase quality had a lasting impact on the customer experience, reputation and sales of the automobiles produced. Today, domestic automakers compete equally with Japanese automakers largely because they learned the lesson of total quality.

The lesson of total quality is applicable to any business. I have often asked Marketing Executives if it is easier to enroll a new customer by working your contact list, making an approach, making a presentation and completing the paperwork; or simply keeping an existing customer as a customer. The obvious answer is keeping a customer. In fact, at a recent Melaleuca meeting a survey of leaders indicated that it takes between five and six hours to enroll a new customer. Compare that with the time it takes to follow up with an existing customer to ensure they are having a great experience—perhaps 15 to 30 minutes—which will help keep that customer as a happy customer.

Not too long ago, we conducted a series of focus groups where those of us from Melaleuca watched from behind a two-way mirror so not to bias the participants’ answers. The facilitator let them know that they were being observed but was trained to engage them with a series of questioning techniques designed to get to the ‘heart’ of the matter being researched.

In this instance, we invited two groups of customers: former customers who had not shopped with Melaleuca in recent months and existing customers. The topic at hand was what caused customers to cancel or to remain as customers with Melaleuca. It was very interesting to see that the customer’s enroller had a significant impact on whether he or she remained a customer more than a few months. The enroller’s recommendation and opinion was critical to helping the customer convert his or her home to Melaleuca products. We found that when an enroller followed up with the customer, thanked the customer for their purchases, and was interested in the customer’s ongoing experience with Melaleuca, the customer remained a customer for a longer period of time.

Experience has shown that customers who have help in their first four months placing orders, learning about new products, or simply receiving encouraging words from their enrollers become long-term loyal customers, while new customers who don’t understand the benefits of being a Preferred Customer and receive a Backup Order are more likely to cancel their membership. Follow up is a great business practice that will help your customers become loyal customers.

When business leaders consistently follow up and make ongoing follow up a part of their organization’s priorities, they experience the following:
• Higher average commissions through greater residual income
• Higher average growth rates
• Lower attrition rates
• More Career and Value Pack purchases by new customers
• More duplication through Marketing Executives advancing to the status of Director or above.

Follow up is the crucial second contact that will secure the future of your business if done right. Follow up can mean the difference for enrolling customers for a lifetime or a lunchtime. Here are a few suggestions of how to implement total quality in your organization by emphasizing follow up:

1. Help Customers Learn to Shop with Melaleuca. Take time to help new customers make decisions about their orders; take time to discuss important Melaleuca products.

Too often, new customers limit their orders to a single product category (i.e. only EcoSense or only Vitality for Life), ignoring the 300 other Melaleuca products now available to them. The second most common reason customers cancel their accounts is they say they can’t find enough products to fulfill 35 points every month. This really means, “I’ve been stocking up by ordering from only one product line, and I have enough of it to last me the next year.”

How could any customer possibly not afford 35 monthly product points from the more than 300 products Melaleuca offers?

It’s no wonder Corporate Director Myrna Atha recommends enrollers “review the products” at follow-up meetings in order to better ground new customers. Firmly grounded customers realize Melaleuca isn’t a single-product company, and they order more than the minimum every month. Customers who try a larger selection of products in their first several months usually find products they can’t live without, thereby keeping them shopping with Melaleuca month after month.

As well as seeing the long-term benefits, leaders who encourage customers to diversify their ordering have more residual income from fewer customers. Greater organizational volume will also aid you in advancing to new statuses and give you greater Advancement Bonuses.

2. Thank the Customer for Their Ongoing Purchases. One major purpose of following up in the first three months after the month of enrollment is to simply thank the customer for enrolling and shopping with Melaleuca. If they know how important their monthly shopping is to you, they might take greater interest in establishing a long-term shopping habit with Melaleuca. Many Marketing Executives have asked me, “What do I say in my follow-up call?” The first thing you might consider saying is, “I wanted to call to thank you for shopping with Melaleuca. You know that I earn a commission when you shop and I appreciate your switching stores.”

3. Order Every Month: When you follow up with a new customer, it’s a great time to reiterate the Preferred Customer concept—particularly ordering before the 15th of the month—so they can qualify for Advantage Dollars. Take the time with new customers to create a Select Pack that includes the products they have enjoyed from their first orders. Make certain your customer understands the importance of ordering each month. While you likely discussed the Backup Order during your New Horizons presentation, it certainly won’t hurt to give the Backup Order concept a once-over during the follow-up visit.

Enrollers who are nervous about sharing information regarding the Backup Order need to realize the bulk of customer cancellations come not because of the Backup Order itself but because new customers often lack a complete understanding of the Backup Order concept. When proper expectations are set, customers actually place value on the Backup Order.

Skilled business builders can help new customers understand the benefit of the Backup Order as it relates to Preferred Customer pricing: it’s part of a simple concept of customers receiving discounted prices in exchange for
committing to order every month. Taking a minute to clarify or answer questions about the Preferred Customer concept can save you and your team a great deal of frustration or stress in the future, and, if done correctly, it won’t damage your ability to enroll lifelong customers.

4. Build Community: Do you remember the excitement you felt as a new customer? Do you remember the nervous energy you experienced about embarking on the new adventure of building your Melaleuca business?
In two years, regardless of whether your new customers have advanced to Marketing Executive II or Executive Director, you’ll want them to look back on their experiences and say, as Executive Director III Janice Teeter says, “I’ve met so many wonderful people building this business.”

Follow up is a fantastic time to introduce new business builders and customers to the Melaleuca community in order to maintain that energy. Take a minute during follow-up visits to tell your new customers about company-sponsored events like Convention, Launch and Regional Conferences, as well as local team meetings like Fast Track, product trainings and mentoring calls.

New business builders who attend these meetings will receive training, inspiration and support from other attendees. Customers can develop a greater passion for the products, find information about new products and
meet others with similar interests. Build that sense of community for you and your organization.

5. Clarify and Get Referrals: The follow-up session is a great time to clarify your customers’ desire to build a Melaleuca business. Oftentimes, their perception can change as they experience the products and hear about your ongoing success. Although it’s true that some new customers aren’t
interested in doing Melaleuca as a business, you’ll also find many new customers opt out of the opportunity simply because they don’t fully understand it.

Even if your customer decides not to build a business, he or she can point you in the direction of someone else who might want to. A customer who loves the products won’t be able to resist telling others for long. Be respectful when working with new customers who wish not to build a business, but don’t miss out on sharing the opportunity with their friends and family.

Follow Up Works
So, I’d strongly recommend creating the culture of follow up in your organization. It’s the total quality approach to building a business to last a lifetime. Executive Director II Paulette Magaw observed, “It’s eight times easier to keep a customer than it is to find a new one.” Follow Up allows you to foster lasting relationships with lifelong customers. Quick Follow Up visits are an effective, efficient way to strengthen your business and create long-run dividends. Follow Up is a simple activity that can have a greater influence on the long-term health of your business than any of the other Seven Critical Business-Building Activities.

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