Building Customer Loyalty
The worst thing you can do is leave a customer not knowing what their system can do for them because then they're not gonna use it or they're gonna use it improperly, and it's gonna be a bad experience.
Speaker 2:Because you don't know what you don't know, And the worst problem in in the world is the problem you don't know about. Right?
Speaker 3:So we have a rule too that after an install, within two days, there has if we didn't go on the install, the sales team didn't go, then we have to be, following up with a personal phone call.
Speaker 2:Sales is a job. Right? And, it's nice to get the wins. But to get the wins, you gotta work for those wins.
Speaker 4:We haven't figured out a way to stop people from moving. Our goal is can we recapture the current house, and can we get the new home, and can we be plus one?
Speaker 2:And if you pay your bill for five years, in five years, they will come out and replace all of your cameras. Good morning, and welcome to Coffee Break with Jake. Thank you to all of you who regularly attend the call. And for those of you that may be new to this call, welcome. We're so glad to have you.
Speaker 2:We do this call every Friday at eleven a. M, and the purpose of it is to bring together security professionals from all over the country and all over the world to share best practices, to discuss challenges, and to identify opportunities for growth. And so I'm really glad to have all of you here. Today's call, we're going to be talking about building customer loyalty and protecting your customers from the competition. I think that is actually as important, if not more important, than signing up new customers.
Speaker 2:You want to make sure that your existing customers are happy, that they stay, that they pay, and that they refer new folks to you. So I'm really excited to talk to you guys about that today. And I would love, love, love if anybody knows what their account attrition is, if you know the percentage account attrition that your company experiences each year, if you could raise your hand for me. And I'm going to assume that anybody that raises their hand doesn't know what their attrition is. That's how many accounts that they lose each year, each month.
Speaker 2:All right, cool. We've got Sam on. Sam, so glad to have you on. Out of the 26 or so folks, 23 of you need to figure out what your attrition is. We're going to talk to you about that a little bit here today, and how that's calculated too, because that metric, is really one that, you should be monitoring, very regularly.
Speaker 2:All right. We've got Sam on. Sam, talk to us. What's your attrition at?
Speaker 4:-My attrition usually is like net six, I want to say, net 6%. And we look at attrition based on how many people canceled versus how many new people we signed up. And our biggest thing on attrition really is based on moves. So it's net attrition, which is how many I take that back. It's not new signed up.
Speaker 4:It's net of recaptured of existing accounts.
Speaker 2:So reactivations of existing accounts. Okay. So basically, when you're calculating it, you say, we're looking at the addresses that we currently monitor, and regardless of whose name is on the contract, long as we're monitoring that address, you know, the addresses that we lose is our net attrition. Is that correct?
Speaker 4:Yeah, that's how we look at it. We look at, you know, how many people moved and how many people recaptured. And then we also look at, you know, did we recapture their new home as well?
Speaker 2:So, okay. So this is that's actually really important. Okay. So, capturing the new home. So if you're bringing the existing customer from their old address to a new address, that's contributing against your attrition figure?
Speaker 4:Yeah. We see it that way because it's not an I mean, it's a new address, but like, ideally on any moves are our biggest reason for attrition. Right? We track attrition at a at a reason level so we can see trends. About 52% are moves, and we haven't figured out a way to stop people from moving.
Speaker 4:Our goal is can we recapture the current house, and can we get the new home, and can we be plus one?
Speaker 2:Okay. Cool. How do you monitor that? So, like, how proactive are you about monitoring whether or not folks are moving?
Speaker 4:So when we get a move, we have a a process in place that goes to our accounting department. If they're moving locally, that goes to our sales department to see if we can help them in their new home. That's you know, we're already a trusted vendor. So if we're already trusted and they already like us and they're moving locally, hopefully, we can help them out. On their existing home, we have like our own JM process of we send out mailers at the moving date to leave certain documentation for the new homeowner.
Speaker 4:We get the settlement date. We send out another mailer. Then we send out another mailer fifteen days later. And I think we'll have one at thirty days after settlement. So like, we hopefully have left three mailers plus we've given that homeowner something to leave for the new person behind their alarm panel before they move out of their home.
Speaker 2:Yeah, know, I think that's great. And then I don't wanna get too far into this, but I'm curious, balance a contract, how do you handle it? You got somebody twelve months into a thirty six month agreement. How do you handle it with that subscriber?
Speaker 4:Are they in their first contract or did auto renew?
Speaker 2:Let's say first contract. If it's in
Speaker 4:a first contract and we discounted it, we hold them to the contract. We typically give our buyers different prices for different terms, and they get to choose what their term is. If they said to us, well, we didn't know we were gonna move early. Our standard response is if you didn't know you're gonna move early, we didn't know you were gonna move early either. So, you know, you bought a product for a price with a commitment.
Speaker 4:If they get the new person to take over that contract, we will give incentive to get out of there. Okay.
Speaker 2:Hey, look, you know, we won't hold you to it if you if you're willing to help us get the new customer signed up kinda thing. Correct. Okay. Interesting. Yeah.
Speaker 2:I think and and it's a good thing that everybody on the other end of that conversation is always a very reasonable person that says, hey.
Speaker 4:That always happens. Everyone yeah. Was reasonable.
Speaker 2:Yeah, I totally get it. I understand. We had an agreement, so I'm gladly gonna pay you what I owe you. That's I'm sure that's how it goes. But, really good.
Speaker 2:So, okay, I'm gonna move on from this, but, in just a second, Sam, but I wanna ask you, do you have any incentives for your team to get those new or those existing customers that move or that old address? How do you incentivize your team? You don't have to give me detailed specifics, but, you know, maybe just how they're incentivized to get those reactivations or those system moves.
Speaker 4:Yeah. So it's not a, it's not a spiff per each move. We have a group bonus plan that is put into place based on gross margin each year, and it's really educating my team that our monitoring is a 80% gross margin game. And it's the more people we keep, the better their bonus looks at the end of the year.
Speaker 2:Interesting. Okay. Cool. And then well, I've already had a question. What if they start a service at the new address?
Speaker 2:So, like, if they do decide they're gonna go continue service with you at their new address, do you let them pay for their new system and then continue on with the monitoring at the new address?
Speaker 4:That's a very complicated question. It does not it's not a straight answer.
Speaker 2:Yeah. Because it's always different. Sometimes they have an existing system in the new house. What kind of equipment do they want in the new house? Can you give me the simplest answer?
Speaker 4:The simplest answer is probably not. Okay.
Speaker 2:Fair enough. Fair enough. Because you look at it as, look, this is a new account. We have everything involved in creating an account from scratch is involved here, except maybe a reduced sales commission because there's a difference between a company lead and a is there a difference between a company lead and a self generated lead for sales commission?
Speaker 4:Yeah.
Speaker 2:Okay. Alright. We won't get into that because we're not talking about sales comp. But, thank you, Sam. We've got Clint on the call.
Speaker 2:Clint, tell us, what's your, what's the attrition? How do you guys calculate it?
Speaker 5:Pretty much like Sam was. We we look at our gross. We start off with the gross attrition. We're running about eight and a half between eight and a eight and a half gross attrition. But then we look at our recaptures.
Speaker 5:Basically, somebody moves out of the building, somebody new moves into that building, then they sign up with us. That's a recapture. And we're running in the 6% on net attrition.
Speaker 2:Nice. That's what, 25% of your gross attrition you're you're reactivating?
Speaker 5:Yes. So we're picking up eight that percent. About 2%. We're getting about 2% back.
Speaker 2:Okay. Cool.
Speaker 5:Dropping us to about a six to six and a half percent net attrition.
Speaker 2:Okay. And then do you incentivize your team on those reactivations or system moves?
Speaker 5:Yeah. Both Both sides of it. If somebody's moving out, moving to a new location, or if somebody new moves into the old location, we hand those off to our sales team and and they get full commissions on them. So if it's just go get them, sign back up. But we track.
Speaker 5:We wanna know if it was that existing customer that a new low a new customer's moved into an existing location, we wanna track. That's where our sales team tracks that for us.
Speaker 2:Yeah. I wanna give everybody the opportunity, if you have questions about how to calculate attrition, feel free to raise your hand here. I know Robert's ready to answer the other question, but if you have questions about calculating attrition, or your brain is just kind of like, Hey, you know, I don't know whether we're doing this right, or I don't know if we're if we could be doing this better. Feel free to raise your hand or throw a question in the chat because we've got some really knowledgeable folks on the call that could could answer that question for you. Clint, what's the reason that most people cancel?
Speaker 5:Moves. Moves are our biggest one right now. Yeah.
Speaker 2:Yeah. I'm curious. So how often are they moving within your territory versus moving outside your territory, excluding kind of factoring in the overall PIE umbrella now? But like, generally speaking, we're just kind of talking about the Peak Alarm brand. How often is it that they're moving outside of that service area?
Speaker 1:It's a great question.
Speaker 5:I don't know the percentage, but I'm going to say the higher percentage is moving outside of when we look at peak Utah, Idaho, Western Colorado, they're moving outside of that area.
Speaker 2:Yeah. Yeah. And that's a tough one. And I'm and, and I I wonder on this, you know, for if there's anybody that's willing to share how they handle, folks moving out of state, you know, whether they whether they just say, I have good riddance, there's nothing we could do, or they have or they try to refer it out to another dealer, you'd raise your hand for me before I And thank you for sharing, Clint, on that. I want to jump to Robert Irish.
Speaker 2:Robert calling in. Where are you calling in from, Robert? Are you ready to tell us how you guys calculate your attrition?
Speaker 1:So we're I'm calling in from home today, so still in New York. You know, our our attrition rate would make the rest of the the, security industry choke us 25%, but it follows the attrition rate for a cable company. And as we we tie
Speaker 2:it I don't understand that because I I don't understand how the attrition could be that high because, man, I just can't seem to cancel my cable at the house. I switched, like, months ago, but, you know, it's just such a hassle to actually cancel with the other guys. You know?
Speaker 1:You just need to be patient. We have to seek new problem. Yeah. The government makes us answer so many calls within so many seconds, but we don't have to give you a good answer within so many seconds.
Speaker 2:Yeah. Well, the day it was it was funny. I was saying that the guy was so good. He was so good, the retention guy. And this is a lesson.
Speaker 2:Let this be a lesson for everybody on the call. Our cable company here, Spectrum, my goodness, the retention guy on the phone, I got on this call. I- so I say it was hard to cancel. I could have canceled on that first call. This guy was so good that by the end of the call, even I like to think I'm a, I don't know, reasonably intelligent person.
Speaker 2:I'm like, Man, I don't know, he's given me really good incentives here. He's upgraded my service. Like, all of these things that by the end, I'm like, All right, fine, I'll keep it. But then I still had the appointment with the other company to come change it, and they made it hard to cancel that. And so they came out and installed the thing, and I'm like, Man, now I got two.
Speaker 2:So I'm a sucker. But the point is, their retention department is really, really good. And I think this is probably something that a lot of companies, if you're experiencing attrition that might be higher than what you're comfortable with or you think you could lower it, really looking at, Hey, how do we how do we focus on customer retention is important. And that's a whole another topic. But, Robert, how do you guys calculate it?
Speaker 1:We go share number of people who left as opposed to number of new ads. So the simplest calculation is what we're using right now.
Speaker 2:Okay. It doesn't matter the address. It's like accounts, look account created.
Speaker 1:Yeah. Because it's total accounts. I mean, Wall Street doesn't care if you had a thousand counts yesterday and you got a thousand and one today, you gained one account. Doesn't make it. There's a 15 people left and you 16 new ones in.
Speaker 1:They don't care.
Speaker 2:Yeah.
Speaker 1:You have a thousand yet. They they a thousand and one.
Speaker 2:Yeah. I want to I want to put a giant disclaimer, you know, asterisk on this here. Wall Street doesn't care for cable companies. All of you managing alarm companies need to care about this. So you need to care about, Hey, what is our real attrition?
Speaker 2:Because at some point in time, whether you're dealing with a potential buyer or you're dealing with an industry banker, the industry bankers are sophisticated. They understand these metrics, and they're going to want to know that you understand these metrics. And it's very important that you keep that as part of it. You'll have a loan covenant. So like if you bank and you're, you know, you say, Hey, I want to go into acquisition mode.
Speaker 2:I'm going to borrow some money. They'll lend you the money, but they're going to look at your business and then they're going to set loan covenants that say, Hey, look, in order for us to not call this loan, your attrition has to be below this, right? Your growth has to be whatever it is, right? So just be very mindful of that. Robert, what's the number one reason people cancel service?
Speaker 2:Yeah, even though it's skewed by, you know, cable company stuff, what's the number one reason people move for you? Or I'm sorry, leave you, but you just give away the answer, I'm sure.
Speaker 1:That's okay. They say, you know, the company itself says it's move- it still moves. I mean, the moves seem to be the biggest thing everywhere in every industry when you're a service, right? If you're a regional service or a local service, people move. And the government's doing a real good job of helping us stop those movers by keeping them interest rates higher.
Speaker 1:Those people will be buying new houses and moving. So we'll be, we should be good. We should, we should benefit, but that's what they say. But in the cable industry, there's a lot of, overbilled. Now the government is paying people to go in and set up new companies just to compete with the existing companies for no reason.
Speaker 1:So with that happening, you get the, the, I'm leaving because they're $5 cheaper.
Speaker 2:Yeah.
Speaker 1:Okay. And at that point, doesn't make a difference or I'll give you the $5 We should have given it to me two years ago. Goodbye. So they leave, But we don't really I don't put a whole lot of stock in there because that deal's only gonna be good for a year, and then they come back because then we've got a better deal. I mean, you've got that
Speaker 2:Oh, that's such a that's a whole another okay. This is a great that's a great point, right? And there's some parallels there between the cable companies and a lot of these companies that aggressively sell door to door and provide subsidized or low cost or no cost systems. I don't think anybody's really doing no cost anymore, but maybe they wrap it in consumer financing or something. But they come to it.
Speaker 2:They come to you with a deal. They come to your customer with a deal. And I hear this all the time. Somebody knocked on the door, sold us a system. They canceled with their local company, and then they come back.
Speaker 2:Right? And so this idea that and this is a good segue for where I want to go next with this. This idea that if you have a if your customer has a good enough experience with you, right, and they do make a change, and the experience isn't quite the same, or now the numbers don't really, you know, don't really work as well one way or the other, if they- if their experience with you was such that they say, Hey, you know what? I still want an alarm system, but I don't really like these out of state guys. You know, they gave me a really good deal.
Speaker 2:They gave me some kind of package, but it turns out their service wasn't really what I expected it would be. We're having issues with this. And I remember when I had a system with Sam, Sam's system worked, right? So I'm going call back Sam. I think that's a- I think it's a good segue because what I want to know is, is there anybody on the call that does a certain thing during the initial install that you believe leaves a lasting positive impression with your customer?
Speaker 2:Is there anybody that does that has a certain thing or things that they do during or after an initial install that they believe ensures a positive experience for their customers? Anybody? We're going to go to Robert. If anybody else can think of anything that they do, we'll go to you. Robert, talk to me about during install or post install, how do you ensure your customer has had a positive experience?
Speaker 1:No, I think a lot of people agree with this. It's all about training the customer. The worst thing you can do is leave a customer not knowing what their system can do for them because then they're not going to use it or they're going use it improperly, And it's gonna be a bad experience. Even if a customer doesn't buy any, automation type products from me, I give them a full overview of what the system could do. This way they're never sitting there going well, I wish Mike could do that.
Speaker 1:And they leave and I go, well, we could have done that. Yeah. We could, we could have done that for you. You just didn't buy that. Know, so training, training is really important.
Speaker 2:Who does the training, the sales rep or the technician?
Speaker 1:Unfortunately it's the technician. Yeah. They're not always the best trainers, but you know, my guys try. They- they try. I train them on how to train, and, maybe- maybe that's the problem.
Speaker 1:I don't know. But, I mean-
Speaker 2:I would say this, I would- and this is just something you always tell everybody that, you know, I- I think of the alarm industry through really the lens I had as a kid watching my dad, you know, selling and then growing his own business. But, one of his rules when he was a door to door sales rep, was that he would actually go to every single install as a salesman. While the tech was there, he was there on-site to make sure everything was going well, that if the customer had any questions, he was answering their questions, that he personally went through and demonstrated the system, that he went and knocked on the neighbor's doors and let them know, Hey, we're going to be testing the system here. You may hear the siren going off. Don't be alarmed.
Speaker 2:We're just testing it. And and by the way, we have you know, we also are you know, we're local here and we have a package for, you know, neighbors. So personally, I think I think that the I think that it's lazy. My opinion. People may disagree with this.
Speaker 2:But if you're a salesperson in this industry and you do not show up to your own installs, that is a poor practice. I think that the salespeople I hope it doesn't offend anybody on the call. I hope instead you might see it as a challenge, getting your salespeople to go to that install for the very reason that Robert talks about there, making sure that your customer understands how to use the system, making sure that they know all of the things that they could have on their system, making sure that, you know, six months from now when some dude pulls, you know, knocks on their door in a bright orange shirt, right? We know who that guy is and talks to him about all the bells and whistles that their system has that they say, You know what? No, Gage was out of my house, and Gage said that my system could do that.
Speaker 2:But, you know, I wasn't interested at the time. But now that you mentioned, I'm going to call Gage back and I'm going to get that thing, right? It's so, so important. So, Gage, talk to me about making a positive impression on a new customer during or just after the install.
Speaker 6:Yeah, you you hit on it really well. So every sales team I've been a part of, it's either been a point for myself or the sales team in general. We always gave the demos. Doesn't matter if it was residential. Doesn't matter if it was commercially.
Speaker 6:The the difference that I always found was, well, one, I also probably had that system at my house already. And, there's a lot of cool stuff out there you can do with alarm systems, especially with setting scenes and and certain things. And the customers don't know what they don't know. And every one of these apps has really intricate things they can do. And I would just kind of reference those things on what I could do to set scenes, have my garage door open, things like that.
Speaker 6:What made it fun? Because that's what I found was gonna make somebody interested and use the automation out of it. That always made a difference for me. And then I kinda took a an approach from the office. So I would, and all all the commercial reps that I knew, we kinda all did the same thing as I would I would call into our actual service department and then get on a call and show them how fast that they would answer.
Speaker 6:Now that's different for everybody else's service department. But Sure. For us, we always got an answer. It just was a round robin.
Speaker 2:You in the priority line. You were just calling one of the other sales reps, right? They knew to answer the service department.
Speaker 6:Yeah. Yeah, exactly. And so that just kind of set the precedence that, Hey, I'm here for you no matter what. And then our service team is here for you no matter what also when you have questions. And then I would give them my, I, I gave everybody my personal cell phone number.
Speaker 6:We used our personal cells. I didn't have a work one. And so, and people could text me and call me as much as they needed. They would run into things. I was always there to answer.
Speaker 6:It's what led me to more referrals also. And then I also had, you know, along with that demo, we did a one day, a one week, then we did a month, three, six, nine, twelve follow ups that were preset emails that were going to go out. And then from there, everybody got refresher emails where like years after that, they would basically be either be called by our service department or the sales rep could take that call themselves to say, Hey, just wanted to check on you and your system. How are you doing? And a lot of the times
Speaker 2:that led to upsells. Yeah. You know, I think that's such a good point. Also, you know, personal service, them having your number, they can call you. The difference between there are technicians that are good at demoing systems for customers.
Speaker 2:They do a great there are some techs that do a really great job. Like, you know, I don't want to I'm not saying that the salesperson should be there because a tech can't do it. But I also recognize that salespeople have the most direct incentive to do it because of what Gage talks about. Those are the customers that are most likely to refer other people to you, right? The technician doing a really good job of doing a demo, that's not- that's just not the same as the sales rep being seen as their guy, as their security expert, as the guy that they call when they have a question about, you know, some question about their system or, you know, they It's important to have a good customer service department.
Speaker 2:I'm not trying to replace customer service department with a sales rep, but just that ability to be the expert and perceived as the expert, man, if that isn't just the best way to get people to to stay pay and refer. Right? Like, that's so important. Gage, thanks so much for sharing that. We have Melanie Henson on the call.
Speaker 3:I almost lowered my hand. You guys hit on a couple of things I was gonna tell you. One of the most important things we did and implemented was, after the install, following up with an email of resources for the customer. There are so many resources already out there. You don't need to reinvent the wheel.
Speaker 3:If you're at Alarm dot com, they've got all the user videos. Putting all those in one place and then making sure the customer knows you're going to follow-up with, Hey, if you can't remember how to add a user, if you don't know how to change the rules on your cameras, then here's one email that you need to reference. We really did that, but it's kind of like you said, the techs didn't build that relationship. That was done from the sales department. The techs are just following up, nurturing it.
Speaker 3:We have a rule too that after an install within two days, there has to if we didn't go on the install, the sales team didn't go, then we have to be following up with a personal phone call to see what they have. Think that keeps your customers sticky because the worst thing you want is someone calling you with the same question over and over and over, and that's what was happening. That was why we built this one follow-up email with as many resources as we could find that would give them a place so they're not calling me and asking me how to The worst question we always get is, How do I add a user? Things that they should know how to do. Trying to give them a location to know where they can find those answers has been successful for us.
Speaker 2:Yeah, it's funny you hit a nerve with me there. Months ago I was out on the boat, I was fishing with my dad, and my dad owns an alarm company, as you know. And his customer makes me think of Gage, this perception that or this idea that being so available to your customer, if they have a question, they need something, I think it's like a Saturday or something. We're out on the boat, we're fishing. And Melanie, you could send all the emails in the world, and if people would actually read their emails, they would have all the tools, or if they just Google it, sometimes I have an acronym, which is LMTGFY.
Speaker 2:Let me Google that for you. You know, like it is the solution for most questions. Now it's, you know, let me chat GPT that for you. People ask me questions. I'll just throw in a chat GPT.
Speaker 3:Sad back. Well, some of our customers just wanna call us.
Speaker 2:No. I I this I is my point. You're on the boat you're on the boat fishing. We're on the boat with my dad, and we're fishing, and and, you know, so it was it was one of those things where they had a question. They were leaving on vacation the next day.
Speaker 2:They needed to add a temporary user code for a family member that apparently they trusted enough to check on the house, but not enough to give them their master code. I'll take that. So interesting family dynamics going on there, and they need an answer. But that's why he has customers that stay and pay and refer, right? Because if somebody does need something in a pinch and they have, they realize, Hey, you know what?
Speaker 2:I made sure to buy a new bathing suit. I packed the sunscreen. I got our, you know, checked in our flight. But, my goodness, I don't want my mother-in-law to have the master code to my house. I need to get her a code, right?
Speaker 2:You know? So, what do you do? You call George, right? And I think that's just a it's a good example of it. I will say this, though, Melanie.
Speaker 2:I think the two day rule -I would challenge your sales reps, if they don't have a valid reason, if there's not some reason, like something really, really important going on that's keeping them from going to that install, I would say, Hey, it's two days if you've given me a really good reason that you're not there in the first place, because, man, I can't tell you how important it is. Some of the companies that I know that do the best with selling upgrades, they're there on-site, and then they're able to you know, they put out all the things. They've got their even if they didn't buy it, they set on the kitchen table a floodlight camera. They set on the kitchen table, you know, a Z Wave lock. They set on there, you know, a little plug in Wi Fi camera, you know, that that, you know, if you wanna if you trust your mother-in-law to check on the house and feed the dog, but you also want to make sure she's not going through all your stuff, you could buy this Wi Fi camera.
Speaker 2:You could plug in just when you're away from the house, right?
Speaker 3:-Jake, I think, I mean, the educated customer is the one that stays, right? But we all know that educating the customer can be very time consuming, but that's what makes them sticky when they know that they're buying from you. The problem with that is scaling it, I think, because you can do that for a handful, but then can you do that for a lot? That's where it's like trying to find the right resources that make them feel educated, but still give them that I've got a personal connection to this company, and that's why I'm staying there and not moving to the next one.
Speaker 2:-Yeah, that's a tough one. It's especially tough when owners do the selling a lot of times because when the owner's doing the sale, they may not have the time. When you dedicate when you do have a dedicated salesperson, though, that's a totally different dynamic. It's for the very same reason I absolutely I love, love, love, love, love meeting with our customers. But when they send me purchase orders, I forward it to salesperson, right?
Speaker 2:Not that they can't send it to me, but also, if- if we're to support over a thousand integrators nationwide, I- I have to be able to have some help with it, too, right? So I can't do all the things, but I am- I am there and available, and you can certainly catch me at 11AM on Fridays. All right, Mr. Kirk, what do you got going on? How do you ensure that customer satisfaction at the time of the install or just after?
Speaker 7:So a lot of great, tips here. And, you know, as an owner salesperson, you know, we have three, four salespeople, I've been one of them for a long time. You know, you've challenged me to ensure our team is getting out there to start the installs and end the installs or minimum call, right? But I think 80% of the time they need to be there at the beginning and the end. We need to step up better on that.
Speaker 7:And as an owner, I guess I play my owner's card there sometimes, but I really rely on my team to help. But a couple of things that we're, we've been doing and that have been very helpful. One is we text a contact card of all of our people. So we get in their phone. So I think that's a good tip.
Speaker 7:Text your contact card. That way when you call people, you know, your name pops up and when they search for you, they can find you in the phone. And it makes it easier for them just to save it, right?
Speaker 2:A 100%. That's actually, that's actually, by the way guys, if you, a quick, quick tip for any salespeople on the call, if you text somebody and you say, hey. This is Jake Voll. Great meeting you today at ESX. Look forward to catching up.
Speaker 2:Even if they didn't save you in their phone, when you call them the next time, if it's an iPhone I don't know about Android. There's probably some Android folks on the call. Maybe you can answer. But I know at least with an iPhone, if the text message says, hey. This is Jake Voll.
Speaker 2:When when I call, it'll say it'll have my phone number, and it'll say, maybe Jake Voll. And I'm like, oh, yeah. I remember meeting Jake Voll. Right? As opposed to, who's this 386 number?
Speaker 2:Like, I don't know. This guy is a telemarketer. Well, spoiler alert, I am a telemarketer because I'm calling to sell him something. Right? But, but it does help.
Speaker 2:So good point on your contact information, but even just texting as a sales rep, just texting your name, is a good thing too. You don't better though to text the contact. You send the contact for the company, right, so that they can reach the customer service line and all that?
Speaker 7:All- all the above, right? Sales, customer service, monitoring station, all those numbers are in there, right? So, Especially for our monitoring station because we're using a third party, right, that's calling from, you use caller ID injection, so when they're calling, they're using our specific number, but we want them to recognize that number so they don't ignore the central station calling.
Speaker 2:Yeah, know. That's such a good point. My system at the house, this week I changed some batteries in my system and I'd screwed some stuff up. It was sending tamper signals in. I got called from the central station like 15 times.
Speaker 2:I am the worst example of false alarms this week. Right? Operator handled events through the roof. But I realized I didn't have the monitoring center's phone number saved to my phone. So it's just an 800 number.
Speaker 2:And for me, I am, again, a sucker. I'll pretty much pick up the phone no matter what phone number is calling me because I'm also an optimist, and I assume, hey, this is somebody calling to buy something from me, so I don't want to send them a voicemail. If I'm available, I'll pick it up. Usually, you're trying to sell me a vehicle warranty. Sometimes, though, it's a central station calling to tell me that my alarm system's setting a tamper.
Speaker 2:Right? But, that's such a good point because my wife, on the opposite side of the spectrum, will ignore any phone number she doesn't recognize. I'm like, who what if that's important? What if that's what if that's, you know, another phone number from the kid's school? What if that, know, whatever it is.
Speaker 2:Anyways, it's a good idea to save those phone numbers. Any other tips, Kirk, on ensuring that satisfaction?
Speaker 7:Yeah. Second one is, you know, part of our ERP software services, we have a really nice survey program in there. So, you know, we send out surveys post sales appointment and post install, getting feedback from the clients. Sending one post sales has been really helpful just to say, Hey, are you happy with your salesperson? Did you show up on time?
Speaker 7:Did you like the value? That's kind of step one. And then step two is post install and, just, you know, asking for that feedback been very helpful.
Speaker 2:I think that's so important, right? Just getting an idea, getting a gauge, because you don't know what you don't know. And the worst problem in world is the problem you don't know about, right? Anything else, we can correct for. We can apologize for, we can fix, we can make sure it doesn't happen again.
Speaker 2:But when we don't know there's a problem, when we don't know that somebody's upset because, oh, I don't know, maybe Melanie came through their house with her muddy boots and tracked mud all over her oriental rug, and it's gonna cost her all this money, and now she's spent all this money to have a security system installed, but the worst person to come into her house was Melanie with her muddy boots, right? And you don't know that, but now, you know, I'm just kidding, Melanie wouldn't do that. She'd put some booties on or take her shoes off. Boots wouldn't be muddy to begin with. But again, it's one of those things that you just don't know.
Speaker 2:Now, we move on to ongoing customer satisfaction, I want to say this again, salespeople. Taking that time to do that follow-up is so important. Being there at the end of the install is so important. And if you're a salesperson, I mentioned this briefly, but going, especially on a residential install, going to the neighbors' homes, around that house, it's just low hanging fruit, right? Like, you should be this is basic fundamentals.
Speaker 2:You know, there's a science of alarm sales, I think, written thirty years ago that would tell you the same thing. You cloverleaf your installs, right? Five houses to the right, five houses to the left, the 10 houses across the street. It's just it's just putting in the work. Sales is a sales is a job.
Speaker 2:Right? And, it's nice to get the wins. But to get the wins, you gotta work for those wins. So, you know, if your salespeople are not cloverleafing, and I'll tell you this, if you want a really easy trick to know if your salespeople are cloverleafing the installs, give them a worksheet to turn in that has the house numbers and the security providers on that sheet. So you write, Okay, we're installing 123 Elm Street.
Speaker 2:Well, 124 Elm Street looks like they have ADT. 125 Elm Street looks like they have XYZ. 126 Elm Street looks like they have Vivint. Maybe they don't all have signs, but now how cool would it be with every single install that you get? You have a little worksheet ensuring that your salesperson went around to those houses, did a little bit of competitive research to see who else is in your neighborhoods, and get an idea of your saturation in the market, plus give you a really nice target list of folks that you could go after in the future.
Speaker 2:Now, we've made people happy at the time of the install. Why do people cancel? They cancel because they move or they cancel because they need service on their system, and Kirk is a big, bad bully that wants to charge them for this service call, right? People want free service. They're paying you $40 a month, and that should include an oil change, tire rotation, and everything else that they could possibly need for the rest of their life.
Speaker 2:If anybody on the call has a way that they address the upset customer that is now paying out of pocket for a service call, would you raise your hand for me? I'm going to keep your hand up, Kirk, because I want to go to you on this. Cool. We got Kandra on as well. Kandra, I got to jump to you, Kandra, first.
Speaker 2:Talk to me about handling. How do you guys handle when a customer is upset that they have an unexpected service call charge, right? It's good money and there's bad money. Any money you spend on your fixing your alarm system, man, it's bad money. I could have spent that.
Speaker 2:I could have spent that on pina coladas by the pool. So tell me me how you handle that.
Speaker 8:Well, when I was in retention, because I would get those. Pretty much, it would depend on the situation. But if it was something like, you know, they changed their internet provider, so obviously it's messing with the cellular system, and it's not an expensive service call, but it's an annoying service call because it's a set, you know, I think it's like $85 or something, What we would do, or what I would do, is I would say, Okay, you know what I can do for you? Is I'll cover this service call, but why don't I get you on a service plan so that when that happens again, you won't have to pay for it next time? And usually by that time, because they are upset that they had the pay, they're already excited that I'm crediting that one service call, and then they added on an additional RMR so that they wouldn't have to do it again in the future.
Speaker 2:That is a slam dunk way to do it, okay? It's so hard to sell a service plan when somebody doesn't have any pain. Right? Like when you're not feeling the pain of, hey, how much could it cost me to service this system? And you say, well, alarm systems don't cost any money to serve.
Speaker 2:I mean, gosh, worst case scenario, if something breaks and I call up Kirk and he's going to give me a free system, right? Because Kirk does lots of free systems. I know he does. He's that guy. But I'll tell you, selling service plans, I had a really, really good conversation with a good friend and a dealer of ours recently, and that was exactly the model that he described, and he described, similar to it at least, and also told me that their service plans, that their service revenue was up and through the roof because they've made a really conscious effort to do it.
Speaker 2:I think that if you're if you don't have service revenue like a contracted RMR for service maintenance on accounts, if they're if a significant portion of your RMR is not maintenance agreements, I would be willing to bet that you have some very dissatisfied customers, whether you realize it or not, because even if they pay for the service call, when they stroke a check for a few $100 for their alarm system, or their fire alarm system, or their access control system, or their camera system, because the sales rep didn't sell a maintenance plan to begin with, that hurts. Your customer is at risk. They're very likely to be considering other folks, right? Coraib, tell me about how you guys deal with the customers that are frustrated about paying for service.
Speaker 7:Yeah, I'd say Kendra hit the nail on the head there and kind of stole my thunder, might say. Though the Pacers beat the thunder last night, so anyways. I'm from Indiana, you know, basketball is pretty cool, but what Kendra said is spot on. So what, what we would do is we would, you know, do the exact same thing. Someone's upset service.
Speaker 7:And I, a lot of times I think if you just explain to them a little bit about the costs that we have involved, that people understand, you know, gas, trip, mileage, anything's cost. The key to that I think is offering that service agreement upfront. And then if they decline that, you know, just a gentle reminder, we do have our gold service Plan and as a courtesy to you, if we go ahead and sign you up today on that, you know, we'll go ahead and waive the service fee. So we don't give them that service call, first service call free, but we do allow them to sign up that day, which would then, you know, cover that call.
Speaker 2:I think it's, again, one of those things where people aren't thinking about it until they're thinking about it, right? And when you throw other value into it as well, not just the, hey, if you're, I don't know, if your motion detector gets knocked off the wall or your door contact, the wireless sensor, the batteries run out, you don't feel comfortable changing it yourself, or you try to change it and now it's sending a tamper because you're a big knucklehead like me. And when you want to send a proper technician out there, there's no charge for that. But I've also seen folks that have been very successful bundling in additional things into that maintenance plan to include things like, and I'm just throwing these out there just for thought, annual system tests in person to where they'll actually come out for a security system. Right?
Speaker 2:You know, this is this is something that we think of for fire alarm systems because you have to have an inspection. Right? But for security systems, man, wouldn't it be nice to know that, you know, somebody's gone out and actually tested every single sensor? I think about how many windows I have in my house. You know?
Speaker 2:When's the last time I actually went opened every single window in my house to make sure that it was working? Or for me, recently, because I was lazy, I changed the batteries only when the low batteries were reported on those sensors. And so what happens? I get up on a stool, I change the battery in my smoke detector, and that's it. And then you know what happens the next day?
Speaker 2:Another smoke detector. I've got to change a battery. And then two weeks later, another smoke detector. So just this idea that, hey, as part of it, you know, not only will we replace the battery in in one of the sensors this often, we're gonna replace all the batteries. Right?
Speaker 2:We're gonna make sure that all of your batteries are changed because batteries never run low at the most convenient time in the middle of the day. They run low at night. Right? That's just the nature of these types of things. Beeps don't happen during the day.
Speaker 2:Beeps happen at night. So you wanna be mindful of that. Cameras, surveillance, surveillance systems, not just bundling in maintenance into that. Hey. We're gonna replace your camera if it fails.
Speaker 2:Hey. We're gonna replace your hard drive if it fails. But also including in that, hey. We're gonna check your system to make sure that your cameras aren't obscured, to make sure that, you know, we come out quarterly and clean your cameras because nobody looks at their cameras I'll tell you when people look at their cameras. People look at their cameras for the first week or so after you install their cameras, and they're super pumped.
Speaker 2:And if it's at their office, they're like, oh, cool. I can watch all my employees pick their nose and text their girlfriend. That's really exciting. But then that wears off, and they never look at it until they have an incident. When they do look at it, they realize, oh, no.
Speaker 2:The camera wasn't even catch it because there was something in the way, or in Florida, it's covered in spider webs, or whatever the case might be. Nobody knows it doesn't work until they need it. And gosh, if that isn't a great way to lose a customer. Right? You sold them a big, expensive camera system.
Speaker 2:You walked away, and you forgot they exist, only to find out when they actually needed that camera system. It doesn't work. I wanna speak specifically to that. Is there anybody on here that offers maintenance, health monitoring on camera systems specifically? Anybody?
Speaker 2:Camera systems specifically? Nobody else doing service and maintenance side of camera systems? We're gonna bring so we're gonna bring in some folks for the maintenance and cleaning on camera systems. I have a customer in North Of Dallas, and I'm gonna she's not on the call, but just just just honestly one of my favorite people in the entire world. And, and they sell camera systems.
Speaker 2:And with every single camera system they sell, she adds I'm gonna throw in it's not the right number because I don't wanna share her number. I'm gonna share a number. It's for thereabouts. Let's call it $15 per month per camera. $15 per month per camera ensures not only are they gonna monitor the status of these systems to make sure that the system is working and operational, that the hard drive hasn't failed, that the cameras are recording, that they're unobscured, but they also include that quarterly cleaning.
Speaker 2:And if you pay your bill for five years, in five years, they will come out and replace all of your cameras with a new up to date system, because what I can guarantee you is that and what she can guarantee them is that the camera systems that they sell today are great. They're awesome. But five years from now, they're going to be obsolete. And you're going to have this camera system that kind of works, that maybe works, that isn't as great as what it could be. But if they sign up for this maintenance plan, and they all do, they'll come out and replace those camera systems with a new system as long as they sign up again and sign a contract for five more years.
Speaker 2:So just a thought on that. I think that's probably one of the biggest risks. Now, really quickly, retention. I want to speak to retention because we we spoke about it briefly. Is there anybody on the call that has a process?
Speaker 2:Anytime somebody wants to cancel, they have to go through a specific process to cancel their service, whether that's an alarm system or whatever it is. Is there a process in place for cancellations? Anybody willing to share that? It's a process for cancellations. Kandra.
Speaker 2:Thank you, Kandra. -Hi, Kandra. Talk to me about the cancellation process. What's involved? What's required?
Speaker 2:How do they do it?
Speaker 8:No one have a process for cancellations?
Speaker 2:-I think maybe it's Friday, and they're already like they're like, Alright. I'm eating my sandwich for lunch. I'm on my way you know, I'm on my way to the beach. So I don't know. I I think there's more processes here than they're willing to admit to.
Speaker 8:I mean, yeah, they obviously, they're gonna call in and let us know what they wanna do. We have them write a letter, whether it's an email, really simple. It's just we have a form, they fill it out, they tell us why they wanna terminate. Mind you, this is after we've exhausted all possibilities to save them first.
Speaker 2:Yeah.
Speaker 8:But if they do decide that they still wanna terminate, then we have them fill out a form. It's a fillable form. They fill it out, and they email it back to us, and then our cancellation department takes care of terminating the billing and everything like that, and or sending them a final bill.
Speaker 2:Yeah. So, guys, for scaled companies, and I use the word scaled very loosely here, I would say for a company that has more than one person in the office, more than one person in the office, Maybe somebody that handles billing questions from customers. This is the person that when somebody calls to make a payment or they have questions about their bill, they can call this person. There should absolutely be a series of questions that you ask your customer. Why are they canceling?
Speaker 2:Number one, right? We need to know that, we need to track that, we need to report on that. Why are we losing this customer? Is it a system move? Have we lost them to competition?
Speaker 2:Are they dissatisfied with our service? Right? We also need to have a process to remind them of the services that they have. One of my favorite things in terms of retention that I've ever heard, it's actually something I've heard my dad do a million times, not because he's had a million people cancel, but yeah. That sound that doesn't sound great.
Speaker 2:Not a million times, but but enough times. He he reminds them, that their service includes smoke and heat detector monitoring and lets them know, hey. Look. I understand, you know, the service, it may be outside of your budget right now, but what I'd like to do for you is we can terminate this account, but I'd like to give you at least another ninety days here to where we're not going to bill you for service, but I want to make sure that your smoke detectors continue to be monitored at your that's important to me, whether you use your system or not. And this overcomes a couple of things.
Speaker 2:Number one, it overcomes the reason a lot of times people say, Hey, I never use my alarm system. I never use my alarm system. Well, whether you arm or disarm your system, it doesn't matter because those smoke detectors, they're always on, right? If there's a fire in your home, you have pets in the home, yeah, I've got a dog. Well, if your if your dog's at home, those smoke detectors are working whether your system is armed or not.
Speaker 2:And I want to make sure that we at least keep the service on. I understand you're going you know, you lost your job. You're waiting to find, you know, something new. While you sort that out, I want to keep this account active for you because it's important to me. Now, nobody can object to I've talked about this before.
Speaker 2:Nobody if I told you Nick, I said, Nick, we've got Nick on the call. I said, Nick, you need an alarm system. And Nick says, No, I don't. I've already decided that. That's why I'm calling you.
Speaker 2:Right? Like, I'm calling you because I don't need an alarm system. Right? That's an argument. But if I say to you, Hey, Nick, your dog is important to me.
Speaker 2:You can't argue with me. You're like, That's weird. I don't I don't know why you care so much about my dog. Right? But if I said that to you, you couldn't argue with it.
Speaker 2:You would say, Hey, well, gosh, Jake's worried about my dog. Maybe I should be worried about my dog. Maybe I don't arm my system because I'm in distribution. I don't make enough money to have anything in my house worth this deal. But I got a dog at the house, right?
Speaker 2:And I don't want my dog to burn up in a fire. So now I start to think the wheels start turning. I've now been offered this incentive, which is either free or reduced service for a period of time. We're gonna pause the billing. We're gonna restart it.
Speaker 2:And now I have some time to cool off and think about things and maybe cancel a Netflix subscription upgrade. Maybe I gotta watch maybe I gotta watch commercials on Netflix like The Poor's, or I can't watch, you know, YouTube TV or whatever it is, but I need to make sure that Otis, my sweet little cavalier, does not burn up in a house fire. I'm going to keep my service and my monitoring. Guys, we've talked about a few things here. Number one, we've talked about attrition, how to calculate it, why you should monitor it.
Speaker 2:You need to be looking at it. You need to
Speaker 3:be
Speaker 2:tracking it, and ideally, you're providing some type of incentive to individuals or your team to get that number within a target range. But at the very least, you need to know what that number is because at some point or another, it's going to come up as a question. The other thing we talked about is making sure that your customers are delighted and educated at the time of install. That's so important. This is the time when you're in somebody's house.
Speaker 2:I cannot tell you how disgusting it was when I needed some plumbers to fix something at my house, and they the most these guys were a mess. Right? They fixed my problem, but I would never call them again because they were gross. Okay? Nice guys, very capable, but I would not have them back.
Speaker 2:They tracked everything through my house. It was it was a mess. You want to make sure that they're delighted. You want to make sure that they're educated because that's saving you from potentially losing a customer to the competition when they come up and tell them about something that's new. They know, Hey, that's not new.
Speaker 2:That's available from the folks at OnGuard. I could get that tomorrow if I wanted it, and I'll call Kirk if I do. The other thing that we talked about is keeping your customers satisfied by proactively selling them service agreements. This should be a core part of your business. Now, we're not we don't have time for it today.
Speaker 2:We've talked about it in the past. We'll talk about it in the future. But your service agreements need to be profitable. You have to make sure that if you're delighting your customers, that you're not hurting your bottom line. Right?
Speaker 2:Like, you you need to make sure that that's good for everybody. You can do it in a way that is both profitable and satisfies your customers and keeps them happy and keeps them sticky. Guys, that's all I've got for you today. I hope that you took something away from the call today that you can take back and apply to your business. I want to thank you all for joining the call.
Speaker 2:We do this coffee break every Friday at eleven a. M. If there's anything that you wanna talk about, feel free to send it in. Next week, we're talking about mergers and acquisitions, buying and selling alarm companies. I would love to have you all on.
Speaker 2:I've got a special guest on, Colby Monachino from Monachino Partners that's gonna be joining us as well. And I know we've got some other subject matter experts that regularly attend the call. I'm sure it will be joining as well. Guys, if you do business with us today, I wanna thank you for it. I appreciate the opportunity to bless and brand your equipment.
Speaker 2:We appreciate the opportunity to serve your business. If we don't do business today, I invite you to reach out to me after the call. Just send me a note. We'll get you set up. Would love to get you, again, blessed and branded.
Speaker 2:But if you don't do business with us, you're still welcome on this call. Right? Because I selfishly host this call every week because the most important things that I've learned, I've learned from other people. And so, please join us again. We'll be back on next Friday at 11AM, and then we're taking we're taking the following week off for, fourth of July.
Speaker 2:So, look forward to seeing you guys next week, and have a great weekend.
