Everyone’s got their concerns about losing clients in this economy and rightfully so. That’s why high value is so important. High value meaning what you bring to the table helps clients in a way that allows them to effectively continue doing business. You help them to not go out of business as well as be poised for growth in a better economy and that keeps you humming along.
It’s a simple concept right? But how do you do it? The first thing to do is understand that although exceptional services and products are a must, these points are not necessarily going to keep clients from looking elsewhere. What will give them no choice but to stay with you is adding on services and products that are so important, priceless even, that they effectively can’t afford to lose them and suffer the pain it will bring.
Although there are some easier ways to accomplish the Iron Cage, this way just mentioned, if accomplished, can’t be beat. Let’s throw out some examples from outside of the tech world first.
I have a mentor that used to be an owner of a few menswear stores. One of the duties he partook in was buying merchandise for the stores. To help him with this he was part a buying group to leverage discounts from vendors. His annual discounts totaled over 20 times the yearly cost of membership into the group. Needless to say he didn’t leave the group until he sold the business. And he said even if they doubled the price, he would have been stupid to leave. Instead the buying group was the stupid ones for setting up an Iron Cage and not taking advantage of raising prices. But that’s another topic.
As another outside the tech world example, let’s look at a restaurant rewards program. There is a company I know of that provides everything a retail business needs to develop a loyalty rewards program to their customers. Places like restaurants, stores, repair shops, etc. And here is their Iron Cage; they have a terrific turn-key setup that these retailers can utilize very quickly, and it works well. But what happens if a retailer decides not to do a loyalty program anymore? Well, first off they would need a swift kick in the pants as this would be a bad idea. But from the program provider’s point of view, to stop a rewards program will require the retailer to tell all of his point holding customers that their points don’t have any value. Would you want to have to make that decision? That’s an ultimate Iron Cage.
So what super important and ultra valuable things can you add to your services and products?
Can you come up with a discount they could never get themselves for hardware/software/services that are bought or used on a regular basis? Maybe set up a buying group of your own. Are there any services you can add for free (without putting a dent in your pocket) that they would normally have to pay for? Is there a reward you can give to a client for doing a certain amount of business with you or signing a contract for a certain length of time?
The easiest way to think of Iron Cage possibilities is to make a list of activities you want a client to do to help your business out, and come up with a reward for it. Believe me that it works for every business model.
Just keep in mind that we are talking about clients that already employ your business. We always want to make sure they are happy doing business with us, but the Iron Cage is our way to guarantee that straying for any reason is really not worth the effort.
If you get stumped on this, you know where to find me.
Just follow this link to set up a free 30 minute coaching session.
To Your Business Success
George Sierchio
The Consultant’s Coach
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