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This is Part 2 of 3 in our series on Making Your First $1,000.
Now that you have your business idea, we’re going to focus on getting customers.
There are a lot of ways to get customers. Many of them are longer term investments and cost money. We’re going to start with the easiest. That’s word of mouth referral.
The first place to start is with the people you know. These are your friends and family. This group is the most commonly overlooked and that’s a huge mistake.
These people are your base. You don’t even have to concern yourself with whether your friends or family will buy from you—it doesn’t matter. You need to make yourself known to them because that awareness will result in referral business.
It’s not about getting your Aunt to buy from you. It’s about leveraging your base by making sure your Aunt is aware so she can recommend you to her neighbor.
Highlights, Takeaways, Quick Wins
- When it comes to getting customers, it’s not about the one transaction—it’s about the lifetime value.
- Word of mouth referrals are powerful as a way to get customers.
- Put 80% of your effort into encouraging word of mouth referrals.
- Don’t overlook your initial network base—your friends and your family.
- Prove to your network that you are a professional consistently and relentlessly.
- If you’re looking for customers, they need to know you exist.
- Content is how you become relevant and known.
- If you’re going where there’s competition, you have to differentiate yourself.
- 02:23 Sean: Matt and I were hanging out over the weekend. We had dinner with our wives, and we put up the whiteboard. It’s an adhesive whiteboard, and you can still see a bunch of drawings up there. It’s normally fine to see drawings on a whiteboard, but I already erased it.
- 03:00 I had one of these WriteyBoards at my old place, and it was great. We loved it. Matt and I used it all the time, and it was super good. This one isn’t. You draw with the marker, you erase it, and you can still see a faded line. You have to spray it and scrub it, and it will come off if you spray it, but who wants to do that every session? It was $96. Yesterday, I decided to call the company. I bought it on Amazon, but I decided to call the company. I said, “Hey, bought this thing and it’s not erasing.” She said, “Did you try the cleaner?”
- 03:48 I said, “Yes, but I don’t want to do that every time.” She asked if I used the markers that came with it, and I said yes. I also used other markers, and it was the same result. I thought the eraser was bad, so I bought another eraser on Amazon Prime. Same thing. I throw money at problems, so I felt silly calling them. As a quick rabbit trail, we were in Austin having lunch, and Aaron got some food he didn’t like. He said, “Oh, big deal. I don’t like the food.” Matt said, “Send it back!” He said, “No, I wouldn’t do that,” but Matt said, “If you’re not happy with it, send it back. They want you to be happy.”
- 05:12 If you’re not happy, you’re not going to recommend it or come back. Aaron said, “I never really thought of it that way. The way I grew up, you don’t complain. You eat what’s on your plate.” A lot of us are like that. You tend to not complain, but these companies want you to be happy. You should complain if you’re not happy with it. I remembered that, so I thought, “I’m going to call this company and complain.” Normally, I would just throw money at the problem. I would say, “Cory, rip it off and throw it in the trash. I’m buying a real whiteboard.” I would throw money at it, and we would have a good whiteboard, but instead I decided to call them.
- 05:43 I called them, and after one ring, a person answered: “Hello, it’s so-and-so with WriteyBoard.” It wasn’t a recording—it was human. I said, “Hey, here’s the situation…” She said, “Oh, that’s terrible. It’s not supposed to be like that at all. What’s your name?” My name was all the information she needed to find out that it was an Amazon order, and she said, “We’re going to refund your money right away.” I thought, “Wow, that’s pretty good. It’s on Amazon, but they’re refunding the money back to me. That’s pretty impressive already.” She said, “Did you get the glossy or the matte?”
- 06:29 I said, “I think I got the matte one.” I realized that I had the glossy one before, and that one was fine. She said, “A lot of people prefer the matte more for projections. It works great for that, but it’s not super clean when you’re trying to erase it. I’d recommend the glossy, if that’s okay with you.” I said, “Yeah, I didn’t even think about it.” She said, “I’ll refund it right now. Actually, we can send the glossy to you right now with the address that’s on file.” I was stunned.
- 07:03 Matt: Blown away.
The Lifetime Value of Your Customers
- 07:05 Sean: I only realized after the fact that they not only refunded my money, but they’re sending me another one. I was going to go on Amazon and buy a new one with the money I got back. I’m even, right? Now, I’ve got this one, they’re sending me a new one, and I’ve got all of my money back. Think about how crazy that is. I was on the cusp of writing them off forever. I was never going to use them again, and I probably would have recommended against using them. I don’t know what the problem is. They solved it instantly! A human answered the phone, and when I told them that there was a crease on the right side, they said, “It’s not supposed to be like that. We’re sending you a new one.”
- 07:46 Instantly, I went on Snapchat and I told the whole story. Check out WriteyBoard—just don’t get the matte one. It’s super great, and I’m super happy. Look what they just did. You don’t know who the person you’re dealing with knows. You don’t know who this customer is going to talk to, what kind of influence they have, or who they were about to recommend your product to.
When it comes to getting customers, it’s not about the one transaction—it’s about the lifetime value.
- 08:25 I feel like we can pull something out of that story when it comes to finding customers. Really think about that when it comes to this first customer. Yes, you want to make $1,000. I think most of our listeners, in the very beginning, will be doing things that are less than $1,000 per transaction. Whether it’s $100, $50, or $80, think about the lifetime value. Maybe you burn this first person. Maybe you haven’t figured out the process yet, it doesn’t go that well, and you say, “Sorry, I’ll give you a discount.” You should be giving them all of their money back and then giving them some more. Lavish it on them, so they’re excited to come back to you the next time. It creates a story that might put you in an even better place. Think about it. When do I ever talk about WriteyBoard?
- 09:17 Matt: It’s an investment, not a loss. You might be bummed out and think, “I messed up. I lost. I failed.” No. You took a step forward, even if you took two steps back. It’s an investment. It’s a learning experience.
- 09:40 I love that, referral-based customers. That’s how I make my living, referral-based. We don’t advertise because we don’t need to.
- 09:49 Sean: That was my first business. I printed up some flyers, literally. I got a buddy, maybe a brother or something, and we went to two or three communities and walked around putting flyers on people’s doors. I got a couple jobs here, a couple jobs there. I got one job in this older community, a median retirement age community, and for computer repair, that’s perfect. Most of these people have trouble with technology, so they were ready to pay some young kid to solve all of their problems for half as much as the pros. They think, “These kids know what they’re doing. It’s a good deal.”
- 10:34 I get into this community, and it turns out that they have a newsletter. I do a great job for someone, and they put me in their biweekly newsletter. Someone was putting together the newsletter and wrote, “Hey, if you need any computer repair, call this guy.” Next thing you know, it starts circulating. I get more jobs, and then they recommend me in the newsletter. It keeps going and going.
Word of mouth referrals are powerful as a way to get customers.
- 11:05 Matt: That’s the way I always tell everybody to run their businesses. In the beginning, you might think, “How am I going to find the business?” Sean just gave you an idea of what you can do. For the offline business, we do a lot of that. We don’t do this anymore, but we used to make door hangers. Back then, those were a huge success. The conversion rate was better than anything else we ever did.
- 11:29 Sean: When I worked as a window cleaner, I used to wash residential and some commercial windows. At this window-washing job, the boss always had us put out these door hangers. Whenever we did a job, the neighbor to the left got a door hanger and the neighbor to the right got a door hanger saying, “We just serviced your neighbor’s house.” That kick-starts it. They say, “Oh, hey, I got this flyer,” and now the neighbors are talking.
- 13:34 Matt: We call that the Five Around. Basically, the five houses that are around get door hangers. We used to do that, back in the day, to get that starter business going. That was how we started. We did that for three months. Our strategy was to get referrals. We just did an awesome job for those customers for the first three months, and they passed the word along. That’s not to say that we did an excellent job on every single one. We were still learning. I was going towards a cashflow business, so I didn’t know everything about it. I was still learning.
- 14:18 I remember two or three jobs, right off the bat, that we just gave to the customer. I definitely lost money on that. On top of that, I gave them free services, or free something. Those people were well known in the community, and on top of that, they were part of the HOA, so they told all the people at their HOA picnic. We got a ton of business from that. They told their friends and family, and it just exploded.
Before you think about other methods that might work at scale, put 80% of your effort into encourage word of mouth referrals.
- 15:03 Matt: We always used to give little business cards to people. I’m in love with Monopoly, so I would give them what looked like $100, but it was really $100 off their next service or for them to give to their friends or family. Automatically, they would get whatever the dollar amount was for that service. We would pull up to someone’s house, and they would pull out this little $100 or $50 coupon and give it to us. We had given that three weeks ago to someone else. We would do a good job for them, and they would pass on the word to somebody else. That was the most important thing—always being on top of the job and the quality.
Family & Friends
- 16:00 I do a lot of networking. For us, there are a lot of HOA places you can go meet and talk with people. Around where I live in the different communities, I would go to board meetings and talk with people. They would say, “Who the heck are you? Do you live here?” I would say, “Actually, I don’t. I live down the street, but I own a lawn maintenance business, and I do a lot of business here.” I do what one of my mentors calls “schmoozing.” You network with people and talk about your business. It’s not like you’re going in there to spam them.
- 16:56 It’s not like you’re going around, passing out business cards to everybody. You’re just carrying out small talk, conversation. That’s it. You just tell them about your business. I had a little portfolio back in the day, a three-ring binder, with pictures that we printed. We used to go and show people the pictures. Networking was one of our big things, and that helped. That also goes back to the strategy of referral. We would get one or two jobs from that, and then, “Boom!”
- 17:47 Sean: This person who has listened to the first part of this series, they have their business idea, and they are thinking, “Okay, I’ve identified this house on fire problem. How do I find the people?”
- 17:57 Matt: Here’s another simple thing that we did. Back in the beginning, we just told our family and friends. They were super excited that we were starting a business, so that was $1,000 right there.
Don’t overlook your initial network base: your friends and your family.
- 18:16 Sean: Don’t think, “It’s just friends and family. They’re just going to do it to support me.” Guess what? Let them do that. Don’t be so proud that you won’t tell your friends and family. They’re your network. That’s the catalyst. This is how you get started. Don’t be shortsighted here. It’s not just your aunt or your friend, it’s your friend’s friend and your aunt’s neighbor. It’s your friend’s teacher or their student. It’s much more than that. This is the starting point. All you need is a little bit of traction. The hard part is the initial part, because then it starts going on its own.
- 18:54 Leverage what you have. Don’t be afraid to tell the people you know, friends and family, that you’re starting a business. People worry that they’ll just want a deal, but I always say, “Best friends pay full price,” and then they tip on top of it. The option to do free work resides with the person doing the work. Don’t let friends or family say, “Hey, will you do it for free or for a discount?” If they say that, just move on. Say, “No, sorry. I have to sell to stay in business. If you want to support me, I would love to do it for you.” Don’t feel pressure to discount for friends and family. Treat it like a business. Most of them, if they’re good friends, will pay full price, and they’re going to tip you.
- 19:50 Matt: Let’s say you’re going to a family reunion. It’s the first time you’ve seen everybody, and you have this business idea. You haven’t even started, but Sean and I are telling you to talk to your family and friends. Here’s something I did when I was a kid. I had my little portfolio, and I kept it in my parents’ car, because I was trying to sell my services. Back then, when I was 12, I had my lawn mowing business. I had pictures of people’s before and after of their lawns. I also cleaned out flower beds and trimmed bushes, stuff like that, and I had pictures of all of it. Think of your portfolio as I’m telling this story and put that together.
- 20:36 Now we have Facebook. Put together a Facebook page with pictures of your work. Here’s the thing—you have to prove to your family and friends that you’re a professional in your business, or that you are striving to be one, that you know what you’re doing. They’re not going to hire you because you say that you know what you’re doing. You have to prove it to them.
Prove to your network that you are a professional, consistently and relentlessly, because it’s not about getting their business—it’s about getting the business of everyone they know.
- 21:14 Sean: Even if they don’t hire you, even if it’s your uncle, your brother, or your friend, they know people. Don’t worry if they don’t hire you, because as soon as this topic comes up with someone they know, they’ll say, “Oh, my brother does that.”
- 21:32 Matt: Somebody was telling me about somebody that does concrete, and it stuck in my head. We needed someone who does concrete staining, since we don’t do that.
- 21:48 Sean: People want to be seen as useful and helpful. If you know how to do something, you’ll say, “I know how to do something,” but also, if you don’t know how to do something but you know someone that does, you get to be seen as useful and helpful by being the person who knows someone. You’re a source of information, someone that people can trust. They think, “Whenever I need someone, I ask Matt. Either he can do it, or he knows someone who can do it.” Let the friends and family in your life be that. You have to do this. If you want to make $1,000, you can’t be so proud that you don’t tell your friends and family, that you don’t go to them and say, “Do you need some help? Do you want to support what I do?”
- 22:36 Matt: It goes right back to the referral, which you want to get to at that point. You don’t want to be doing any more advertisement. Just today, 10 new big jobs came up that I had to turn down, and they all came from people that we know, family and friends. It started with family and friends. You want to make $1,000? Get your portfolio together and talk to your family and friends.
- 23:33 I really do like getting customers online. That’s the new thing now. I’m a big believer in investing in things, so I’m a big believer in paid advertisements. When we were advertising, it was 80% paid. The other 20% was door hangers, signs, and so on.
- 23:58 Sean: I think that’s legitimate. I think it’s good to put that on people’s radar, but I want to shift it a little bit. We’re talking about making your first $1,000. They don’t have money to invest in advertising yet. Guess what’s free? Here’s what’s free: social media, content marketing.
- 25:30 Gary Vaynerchuck says, “Content is the cost of entry for relevance in our society.” You want to be relevant. You want people to notice you. You have to create content. That’s the reality. You want to make $1,000? You have your business idea? If you’re looking for customers, they need to know you exist. When I said, “Be relentless, talk about it all the time with your friends and family,” are you seeing all your friends and family every day? You’re not. You see some of them, every once in a while.
- 28:04 You don’t see all of them all the time, but you can online. You see them on social media. They’re following you, they’re friends with you, they’re subscribed to you, they see your posts. If you put out content, it creates awareness.
Content is how you become relevant—content is how you become known.
- 28:23 You’ve got this idea. You want to walk dogs. You need to start talking about walking dogs. You need to talk about why it’s important, the considerations you need to have for walking dogs, what time of day you should walk them, how often you should walk them. Does the breed matter? Who should be considering this? Should you consider the amount of time you spend per week walking your dog before you get a dog? I’m creating half a dozen articles here. You should be putting out articles, putting out tweets, Snapchatting, and putting out videos on YouTube and on Facebook. You should be creating content like a madman or a madwoman.
- 29:04 People need to be aware of you. Once they come to associate you with that thing, you come to their mind. They think, “I’ve got to walk the dog, but I’m super busy. I have to do this deal.” Who do they think of? That’s business, right there.
- 29:18 Matt: People will automatically say, “Oh, you need to see this guy’s stuff.”
Offer a Unique Twist
- 29:35 Something I had to think about when I was preparing for this show was the unique twist. Let’s talk about dog walking. I like that. Depending on the kids in the neighborhood, if there is competition, you need to figure out a unique twist that you can add to your dog walking that will put you above your competition.
- 30:16 Sean: It’s going to make you stand out from everyone else, making you the obvious choice.
- 30:22 Matt: Let’s say that all of the kids in the neighborhood are doing content marketing. They’re Instagraming like crazy. They’re even on Pinterest. What’s going to make people pick you over of everybody else? I want to throw that back to Sean. What would you do?
- 30:45 Sean: When I saw Matt’s notes in the outline, all I saw was “unique twist,” and I thought, “Oh, that’s good.” I wasn’t even thinking of that. I was thinking, “What’s the idea? Who are the customers? How do you find them?” But what is your unique twist? Why should someone go with you? We already said this in the last episode. Go back and listen to part one if you didn’t hear it. You have to go somewhere where there is a market if you want to make money. We’re not recommending that you play the lottery or try and make a market. It’s not impossible; it’s just improbable.
- 31:16 Go where the market is. Competition is good, because it’s a validation of the market. If you’re going where there’s competition, you have to differentiate yourself. Why, in a competitive marketplace, should someone go with you over someone else? What do you do better than your competitors, the people doing similar things to you? What is your unique selling point, your unique value proposition? What do you offer that they don’t? This has to get your gears turning. Why are you better?
- 31:59 Matt: I know a lot of people who say, “I’m going to beat my competition because I’m going to lowball. I’m just going to put a lower price than them.” That’s the worst idea ever. You will be out of business very soon. Never sacrifice your price to get a sale. I’m not opposed to negotiation, but that means we’re going to take some services out. Put together a list of benefits for going with your company. What are some things you’re going to give my dog, if you’re going to walk my dog?
- 32:48 Sean: Olaf was saying that he would throw in a cat flap cleaning if he was doing a pet service. You could clean the doggie door. You could take them to vet appointments. You could have them groomed. Maybe you partner with someone and you get a referral rate. Think about upselling, which is something we’ve talked about in previous Lambo Goal episodes.
- 33:25 Matt: I want to hear from Cory. All three of us own a dog walking business, hypothetically. How would you convince a customer to go with you, without sacrificing the price? We always charge the same. If not, you charge more. Why is the customer going to pick you over Sean and I?
- 34:00 Cory: I would be as friendly and likable as I could be. I would charge more than both of you, and I would give free grooming.