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View Full Version : Free cut w/ referral???


MowinMopar
03-26-2009, 09:54 PM
What do you all think about offering incentives for new customer's??

bohiaa
03-26-2009, 10:12 PM
I never do it, also I never did understand it, is Business really that bad ?

MC Handy Man
03-26-2009, 10:16 PM
I do, I think its a great idea. Yes you may be loosing that money for that one mowing and yes that can add up to be hundreds or maybe even thousands of dollars every season however, consider it an investment. You loose one mowing and gain a whole season of mowing with anoher account. I dont care how horrible business is, If you want more clients it is a great idea.

Woody82986
03-26-2009, 10:29 PM
I offer it. Most clients send referrals my way and refuse the free mowing when I discount it on their invoice anyway. If I can mow a few $30 clients free each year and gain a few good clients, then I'd say it's on par with spending money advertising other ways.

dwlah
03-26-2009, 10:38 PM
I offer a $5 per cut discount to current customers if they refer someone to me that signs up

Gives the customers a little incentive to work for you

This is the way I figure it
$5 discount for one year(20 cuts around here)= $100
gain one $40 per cut yard times 20 cuts=$800
I clear $700
And all Ive really done is my usual outstanding job:)

TJLANDS
03-26-2009, 10:57 PM
I never do it, also I never did understand it, is Business really that bad ?

Understand what?

That it is a cheap ongoing advertising program, very easy,.. unless your customers don't like you, or you just give bad service... Just by putting a sentence on your invoice.

They get one free cut(avg $40) for each customer that signs a yearly contract(avg 1500.00).
Or 50.00 off a yearly Fertilizer program avg $750 if they refer a fert customer.

LB1234
03-26-2009, 11:08 PM
I never do it, also I never did understand it, is Business really that bad ?


it's a good way of having your existing clients do some advertising. What is the cost of a free cut...nothing compared to the cost of a new account, especially if its the next door neighbor. No windshield time or extra vehicle fuel. To me its a no brainer. Although we don't do a free cut but we do do a certain amount off for each account gained. We also give more discounts for the more work you sign up for.

dwlah
03-27-2009, 12:12 AM
another thought good customers arent going to send you non payers

wbw
03-27-2009, 11:19 AM
We send our customers a restaurant gift card when they refer a new customer to us ($50). We also send them a hand written "Thank You" note.

We also take it one step further and also send these to the new customer.

wbw
03-27-2009, 11:39 AM
Before you slam me for "wasting" too much money I'll tell you the logic behind this. We service swimming pools for about $150 per month. Our typical cost of acquiring a customer through more traditional advertising is between $50 and $100. Our referrals always turn out to be excellent customers. When we decide to sell some or all of our routes, the business will be valued at a little over $1000 per customer. I will gladly pay a $100 for a $1000 customer. Any day of the week, all day long. Even if we never sell them, we recover our initial investment in 45 days. If you can do math you will understand the value of a referral plan.

Also, we chose the gift certificate route because we never give our service away for free. We want the customer to remember that what we do is of value.

MowinMopar
03-28-2009, 08:57 AM
I even have thought about creating a cut away coupon at the
bottom of all monthly invoices encouraging the customer to
talk to his/her neighbor about signing on......

wbw
03-28-2009, 10:37 AM
I even have thought about creating a cut away coupon at the
bottom of all monthly invoices encouraging the customer to
talk to his/her neighbor about signing on......


Sounds like a great idea!

LawnBrother
03-30-2009, 09:54 AM
I usually offer one free cut (up to $30) to customers who send me a referral that stays on for at least 2 months and makes timely payments. They usually try to refuse the credit like someone else said, but I give it to them anyway. Works ok, although I think people will refer their friends you if you are a good service anyway, whether or not you offer them a free cut, so I don't plan to offer it this year. Just give good service and ask for referrals. Once you get a good number of accounts the referrals will increase a lot.

LawnBrother
03-30-2009, 09:58 AM
another thought good customers arent going to send you non payers

Just remember that slow payers and cheapskates will refer their slow paying cheapskate friends! I know this from experience........
Be selective of who you offer referral rewards to.

MyLawnBiz
04-06-2009, 02:32 AM
I offer a $5 per cut discount to current customers if they refer someone to me that signs up

Gives the customers a little incentive to work for you

This is the way I figure it
$5 discount for one year(20 cuts around here)= $100
gain one $40 per cut yard times 20 cuts=$800
I clear $700
And all Ive really done is my usual outstanding job:)

I think this is way too much for a customer referal. $100? If I put $100 into advertising or marketing I would expect to get 2-4 customers out of that. 1 free cutting OR the amount you charge the new customer (whichever is less) is reasonable.

capnsac
04-06-2009, 10:27 AM
I offer a $5 per cut discount to current customers if they refer someone to me that signs up

Gives the customers a little incentive to work for you

This is the way I figure it
$5 discount for one year(20 cuts around here)= $100
gain one $40 per cut yard times 20 cuts=$800
I clear $700
And all Ive really done is my usual outstanding job:)

I think this is way too much for a customer referal. $100? If I put $100 into advertising or marketing I would expect to get 2-4 customers out of that. 1 free cutting OR the amount you charge the new customer (whichever is less) is reasonable.

I would agree with dwlah's method. I take it one step further though. Say you give a customer 10% off their years bill every time they recommend a new customer to you. That would give them a huge incentive to refer more customers to you because they could potentially get their lawn care done for free with only 10 customers referred. An increase of 10 additional customers as opposed to giving one customer free lawn care for a year? Hmm, which is better...

garmel
04-06-2009, 10:27 PM
This year I went with a flat $25.00 for a referral and it's working. I wasn't sure if it would be enough but I figured I would start somewhere. Plus, I was getting referrals last year and I wasn't promoting any incentive......but I always give them something for a referral.

TexasFire221
04-08-2009, 08:15 PM
I never do it, also I never did understand it, is Business really that bad ?

Hell you don't need new business. In other posts you make $300,000 plus a year and take your employees to Peru!

ChrisGA
04-08-2009, 08:38 PM
Im just starting my business with a whooping 3 lawns to cut lol but I offer a referral program I havent had any takers yet but I just started it last week.
For me to give a referral reward the customer who was refereed must agree to a season of mowing

refer 1 person=1 free mowing
2 people = 1 free mowing and $10 off next mowing
3 people = 2 free mowing
5+ people 2 free mowings + 25 gift card to a local resturant.

Might not be the best referral program and yes I might be loosing a little money but I will gain money in the long run with more customers. My goal is to get atleast 15 customers by the end of the season. Then once thats reached I will go to 1 referral= 1 free cut and leave it at that.

yourmove
04-08-2009, 09:01 PM
I currently offer existing customers 10% off their next service (usually a cleanup). I just recently had a refferal from this which gained me a terrific account. I just rec'd a check for $2700 to get this new acount ready for the season.

S.I.
04-08-2009, 09:30 PM
Incentives are no brainers. People refer good services anyway, if it is brought up in conversation, but not normally at the top of their 'to do' list. If you offer them some type of reward for doing this then it is something that sits in their mind ready to be brought up for any reason at all.

On top of that the 'cost' (if you can really call it that) of a customer incentive program is minimal if you consider the 'true cost' of acquiring customers through other forms. It is no risk advertising. Your customer gets the incentive only if the referred completes the criteria ...... contract, X amount of services completed and paid for, etc. Once that is done then the first customer gets the incentive. You could spend thousands on other forms of advertising and not get a single new customer. Worse yet you could get 10 non-paying customers.

Good work gets referrals, good work plus incentives gets more referrals, not rewarding your customers for putting money in your pocket could cost you some business.

I do recommend that you thoroughly examine any programs before you put them into action. Be sure to follow through with any plan that you advertise to customers. I personally do gift certificates, as I feel people hire my service to get away from doing work, so they appreciate a night of not having to work in the kitchen as well. I've considered even running a contest with my customers. Maybe give away a BBQ or something similar for the most referrals in a season. That may lead to some shoddy customers though.

Baywatch
04-08-2009, 09:54 PM
I think everyone is correct with their comments.

I did a referral program up until a few years ago and then I did away with it. Turns out I get just as many if not more referrals now (from many of the same people that gave referrals when I was giving free cuttings for referrals).

My interpretation to this is that if you do good work and your clients like you they will refer you to their friends, family, and neighbors. This is whether you butter them up with a free cutting or some other incentive or not. When I stopped giving out free cuttings I began simply calling the client that referred me and personally thanking them for the referral and letting them know how much I appreciate it.

I remember learning in a business class in college that there was actually a study that they did with respect to incentives and compensation and what makes people respond the best. Out ranking pay and kickbacks was recognition. Sometimes an honest and appreciative "Thanks You" will mean more to the client than a free cutting.

This is just my $.02 and want I have discovered.