[Paul] We’ve been speaking a lot about the importance of customer lifetime value… How important is that to you that, when you get that customer, you go on a journey with them that lasts forever?
And what kind of specific things might we be able to do in our business as a physical therapy company to help increase the lifetime value.
[Kevin] Customer acquisition cost is very important and then lifetime value is everything.
And what I’ve learned in my own companies, whether they be greeting card companies, commercial kitchens, or cat DNA companies, is that I’ve learned to change the metric I say to all my CEO’s is to listen 66% of the time and talk 33% of the time.
It’s usually the other way around for most CEO’s and entrepreneurs that want to talk a lot less.
You have to find out what it is that those customers want because you’re going to find an aggregate. Let’s say you talk to one customer, then 10, then 100.
You’re going to find out that 2/3 of the time there’s one thing they all want, and that’s gold to you when you align that information.
Maybe it’s a change in price point, maybe a change in service point, maybe it’s a change in something that they want that you’re not giving them, so to get that data you need to listen, and we’ve really changed in our companies how we listen.
We provide in every case “how was our service?” “What can we do better for you?” And what you’re going to find is about 16% of the people that get the questionnaire respond and the most valuable responses are the ones where they’re not happy.
What did we do wrong?
In fact, in some of my companies, I asked to see that data each month because I want to know what we’re not doing right.
It’s easy to feel happy and warm and fuzzy about the great things you’re doing.
But when a customer spends energy to write a whole paragraph about why they’re not happy, you need to listen. You need to pivot.
You need to fix it because when you fix that problem, they stay a customer.
They’ll stay with you forever out of the respect of the fact that you listen to them, and that’s so valuable.
A customer for life is gold. It’s platinum. It’s diamonds. It’s the whole deal.
And it’s so hard to acquire them because if a customer leaves, you know where they’re going to a competitor. They’re going to a competitor, you educated the customer.
You lost them, and now they’re going into a new relationship because you didn’t perform. I go out of my mind when that happens.
[Paul] What’s the biggest shift right now? We talked about the online, the digital pivot, what else? What’s the other shift that you think that small business owners need to make?
[Kevin] Yeah, I mean unfortunately this is a cost, but when they go to your website and it’s first generation, it’s terrible.
You have to invest in upgrading to much better photography, much better videos, a much slicker interface.
It’s going to cost you some money, but you’ve got to do it because most people, before they engage with you, check your website out.
You want to have testimonials, you want to have photography of the images of where they’re going to go to be serviced or whatever you want.
You need to upgrade the photography so that it’s very clear in 4K or at least 1080P on the videos. We have invested millions of dollars in this.
We standardized DocuSign in our businesses. We standardized Zoom. We standardized Adobe.
What we did is we went and bought licenses to reduce our costs, to upgrade our websites.
That’s your first point of interaction. You don’t want it to look like a discount shoe store.
If you’re not investing there, you’re not in business.
That’s the way I look at it, cause the returns are really, really high and that’s been going on now for about two years.
You have to upgrade your website. It has to be slick.
Listen to the full podcast here: Interview With Kevin O’Leary | How To Increase The Lifetime Value Of A Patient
Or if you prefer, watch the full video here.
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