Dan Kennedy Interviews Marketing Guru Kenneth J Varga
Dan: I’m on the phone
with Ken Varga. Ken, mostly through direct marketing and direct response,
makes so much money they have a person in Washington designated to try and
figure out how to get more taxes out of him. He’s the author of a
wonderful book, which we’ll tell you a little bit more about later, How to
Get Customers To Call, Buy And Beg For More. Ken, I believe, you can
correct me later, but I believe has the largest insurance company serving
nurses all across the country, and again, largely by direct marketing, and
is really a brilliant marketer and a brilliant businessman. I’ve gotten to
know him quite well over the years. Every time I talk to him, including
preliminary conversations for this call, I get a couple of real gems. In
fact, I’ve got several things written down, Ken, from our
off-the-recording call the other day that I want to ask you about. Anyway,
welcome to the tape, Ken.
Ken: Thank you.
Dan: I appreciate your
time. I’d like to actually start out with something you said the other day
when we were talking, that was really the culmination of a story. But I
think it’s such a powerful point, I’d like you to comment on it and maybe
tell where it came from.
You said that one of the
great marketing lessons you’ve learned and things that you try and adhere
to is(and I wrote it down exactly the way you said it in case you don’t
have it anyplace, because it’s profound, and when one of us says something
profound we want to capture it(letting the customer tell you what they
want and how they want to receive it.
Ken: Oh, yeah. That’s
one of the chapters in the book. And one of the things I did, I’m probably
the only author that has their fax number in their book. I’ve received
thousands and thousands of faxes. But the first 1,000 of them, I initially
picked up the phone and I called them, and I was talking to them. They had
all kinds of accolades about the book and everything and how great it was,
and so forth and so on. I just sensed that there was a "but" involved. I
brought it out in the open. I said, "What do you need that would make
these systems in this book more valuable to you?" And whether it was the
medical profession or the lawyers or the accountants that bought the book,
or even MLMer’s, everyone to a T just about said, and this is what’s
tragic was their comment, they’re so busy being their business or practice
that they don’t have enough time to work on it, to take my concepts and
massage it.
So this gave me another idea.
I asked them. I said, "How would you like to receive the information so
that it’s easy for you?" They giggled a little bit and they said, "Just
make it turnkey, where we don’t have to do anything but implement it."
So as a result of that, what
I did was I developed a system strictly for the medical profession, one
for the lawyers and one for accountants and one for MLMer’s. And it’s just
total turnkey. But if I didn’t pick up the phone and do the initial
research, I wouldn’t have gotten that input just by assuming it.
Dan: And so few people
are willing to do that. And the other real important thing about what you
did, as opposed to big business’ focus groups or ad agencies’ focus
groups, is you actually talked to buyers. I always tell people they’re the
only ones who cast votes that count.
Ken: Definitely.
Dan: It doesn’t matter
what anybody else’s opinion is. But somebody who gave you money and
potentially could give you more, their opinion counts a lot. So you learn
some very valuable things from those calls.
Ken: I had somebody
ask me a question one time. "When do you find time to do this, to write,
to run 3, 4 businesses, to pick up the phone and call 1,000 people and
what have you?" My answer was just simply, "I never think about it. I just
go ahead and I do it. And there’s always time to do the other things." I
feel personally, Dan, that we inhibit ourselves enormously by questioning,
"Will I have time," or "is it going to occupy 10 minutes of my time?" It
just short-circuits the real value of doing that research.
Dan: You know, I agree
with you. When you said it was tragic(that great opportunity for(but that
it was tragic that they said that they just didn’t have time to apply this
to their businesses. It is a tragedy that people let themselves get so
busy doing, or as you said "being their business," that they never carve
out time on some kind of a consistent basis to improve that business. I’m
just preparing now, today as a matter of fact, this week, for a boot camp
that we’re doing for speakers. Again, it’s supposed to be a marketing and
business boot camp. But as you go through the questionnaires of the 140
people that are coming, one of the most consistent frustrations and
questions expressed is, "I know we need to do all this stuff, but I don’t
have time to do it." It’s a universal issue.
You do. You run 3 different
companies. Tell me a little bit about your core business. Tell our group a
little bit about your core business.
Ken: Well, the core
business is I insure over 450,000 nurses for malpractice insurance
throughout the United States. And every Friday at around 4:30, 5:00, I get
a report from my aide. All I do is I look at it and I say, "Okay, how many
more new customers this week did I get?" We average about a little over
250 new customers every week. I never advertise and so forth. But over the
last 33 years, I’ve started and sold over 32 businesses. But I started,
initially, each business or bought the business with a 5-year exit plan,
that if in 5 years time it requires my time to be there, that it’s not
self-running by itself, I sell it. And I’ve sold 29 of them.
Dan: It’s a great
point. Very few people have an exit plan at all. But creating that kind of
discipline, that it has to be independent of you or it has to go. Now, the
450,000 customers in the core business, how long a timeframe did it take
you to get there? And just in general, how did you build that business?
Direct mail? Word of mouth? Seminars? What?
Ken: Well, how about
initially, the school of hard knocks, just trying different things and
what have you. Initially, I started just in New Jersey. I got a list of
all of the schools of nursing and I made a presentation for an hour on
legal aspects of all the students when they graduated, because we were
selling life insurance at the time. And that’s another story, when I had
37,000 life insurance agents. And then I used them as leads to generate
life insurance, and so forth and so on. But a lot of the turnaround
started coming around when the first seminar that I really got to learn
about marketing was Howard Ralph’s seminar. I believe he called it The
Jefferson Institute Boot Camp, or whatever it was. And that’s where the
first time I met Jay Abraham and Gary Halbert was. They were 2 young kids
who were hot shot marketing people, and that’s another story in itself.
But primarily, I would say I gained a whole bunch of knowledge from people
like yourself, from a Gary Halbert, from a Jay Abraham, that I just
massaged that concept into direct mail. And it’s all been direct mail.
And this could be for any
product that individuals want to sell. I always maintain a philosophy of
thinking out of the tunnel. How are people doing it currently and how
they’re not doing it that I could do it, that would be a pre-emptive
strike on them, all the competition and what have you. But primarily to
answer your question, Dan, it’s all direct mail.
Dan: So you do not run
ads in the trade journals and this company does not have an in-field sales
force?
Ken: Nope.
Dan: Out-bound phone
marketing?
Ken: Nope. Nope. All
direct mail. They come to you.
Dan: You’re now doing
some things with the internet?
Ken: Oh, that’s a
remarkable story. About 6 months ago, I was reading an article. You always
want to read, if you’re in a niche business, the trade journals and
everything of that community, if you want to use that term. And I was
reading a journal of nursing.
Dan: If you won’t lose
your train of thought, I’m astounded at how many people don’t do that.
Ken: Isn’t it
remarkable?
Dan: You know, we talk
about it all the time. Read what your customer reads. And if it’s in a
niche, it’s the trade journals and the business journals. If it’s a female
consumer, you have to read the magazines that they read and the sections
of the newspaper that they read. And I’m astounded at people who are in a
business and don’t even subscribe to the literature within their own
business.
Ken: Isn’t it
remarkable? One of the most astounding things I find from an
information-gathering, research viewpoint, is the letters to the editors.
That tells me what their problems are. It’s just phenomenal. But in this
one journal of nursing, I read where 82% of nurses have e-mail addresses.
And I said to myself, just arbitrarily I just sat down here, I put the
magazine down, and I took a number and I said, "If only 50% of my nurses
will deal with me online, through e-commerce, I did the multiplication. I
don’t know if you’re sitting down or what. I would save over $3.2 million
in postage and printing expenses just in that.
But the remarkable thing
about this is normally I’m in front of them 4 times a year with my
newsletter, and then when I get their renewal. The key thing here is, and
one of the things all your listeners probably know because you go over it
constantly, is the lifetime value of a customer. What happens now is on a
weekly basis, I can develop a relationship with them with different
articles that will help them.
So what I did on my nurses
protection group website, I also have a nurses forum on there where they
can share their problems with each other. And also a student one. But the
remarkable thing is at a click of a button, I can develop a relationship.
But the data I’m also collecting, because I changed all the applications,
all the renewal forms to gather the e-mail address, plus their birthday,
on the click of a button every morning, my girl just has to click a button
and all these people born on that day get a birthday greeting from me.
It’s remarkable, the technology, what is happening and occurring.
So needless to say, I just
invested in server hardware and everything, to the tune of $140,000 and so
forth and so on. But when you do the numbers of what the potential savings
are, it’s a pittance.
Dan: Now, one of the
ways that you’re getting them to come to your site and to send others to
your site that you mentioned to me that I thought was brilliant, is your
malpractice case of the week program. Can you describe that?
Ken: Yeah. The
malpractice case of the week is where I take a typical case and I write
about it. But the remarkable thing is at the end, I list 3 or 4 questions
like, "What would you do in this situation," or whatever. It really
creates the thinking process on their part. But then, as an adjunct I
said, "Who could really use this?" And it was students of nursing. Why?
Because there’s an instructor in every school that teaches a course in
their senior year called Legal Aspects of Nursing. So what I did was I did
a direct mail piece to all the schools’ deans, asking them to pass this
information to that specific instructor. And as a result of that, I’ve
gotten about 90% of the schools, who now are using this malpractice case
of the week to be e-mailed to their students each week, and they’re
assigning it as homework.
Dan: While they’re
creating all your future customers for you.
Ken: Exactly.
Dan: Of course. Do you
mind if people go take a look at your website?
Ken: Oh yeah, that’s
no problem. In fact, I’ll list a couple of them. One is HYPERLINK
"http://www.npg.com" www.npg.com , and the other one is KenVarga.com. One
of the things that I just recently did last week, I read an article, and
this is where your listeners should constantly be reading. I just read. I
never think, "Where will I get time," or anything. I just read constantly.
And I read an article about the internet, where if you have initials like
I do for npg.com, you’re not going to get as many hits. So I set up a
duplicate website for what the initials stand for,
NursesProtectionGroup.com. It’s a mirrored.
Dan: It’s what I call
a shadow site.
Ken: It just links
right to mine. And bingo. Every time somebody types in nurses, bingo, my
site comes up in the top 10.
Dan: One of the things
that several of my clients have been doing lately, who are really into
e-commerce, is multiple shadow sites that just flip them back to the main
site with all kinds of front names. Like you might have
MalpracticeForNurses.com. So if somebody typed in malpractice first,
instead of typing in nurses, it becomes the all roads lead to Rome
approach. I think it’s one of the most effective methods for maximizing
the value of a site.
Ken: You can do that
when you’re your own ISP. You can have as many, because it doesn’t cost
you X number of dollars every month.
Dan: No. And even if
it does, the cost for most businesses is minor compared to the payoff. How
much direct mail do you do in a year?
Ken: I would say 2 or
3 million pieces.
Dan: Okay. You’re a
major mailer and you’ve been at it for a lot of years. So what can you
tell us that you’ve discovered about direct mail that is like life or
death important in making it work?
Ken: Well, I
oftentimes listen to a lot of copywriters that I meet at seminars. And
they’re always saying… they’re always asking me for my opinion of this or
that. My statement to them, Dan is I test everything. I will never presume
that this mailer will work or it won’t work. I do the testing first. I
always have a control piece that I test against. But the most critical
thing that I’ve learned within a direct mail piece is that headline and
that subhead. I mean, I’ve changed the headline every once in a while, and
I’ve had a 2% or 3% greater response rate.
Dan: With no other
changes?
Ken: With no other
changes.
Dan: You test against
an existing control. Is it fair to ask how many tests you run in a year?
Ken: I would say I run
a minimum of 10 tests. A minimum. It’s like real estate. It’s location,
location, location. In direct mail, the whole thing should be test, test,
test. Never fall in love with your piece.
Dan: Now, you’re such
a fan of direct mail. And I’ve got to tell you, even amongst this group,
the Gold Members, certainly among the regular membership, but Gold Members
even, there are people who are resistant to using direct mail. So how come
you’re such a fan?
Ken: Because it works.
It just brings me in over 250 new customers every year. What I’m going to
be doing with the other publishing business that I’ve created and
everything, is to now… I use endorsements and joint ventures on a limited
basis with the nurses, but I’m going to be using it quite extensively with
all the other products that I’m creating and developing. You know, Dan,
I’m 58. I turned 58 in April. And I’ve never had so much fun in all my
life, because I still don’t know what I want to be. How many people in
life have that feeling at that age?
Dan: Well, I suspect
many do, but are trapped. You, fortunately, have the opportunity to keep
trying to find out.
Ken: And the
flexibility, you were right.
Dan: How about like an
average Ken Varga week? What does your schedule look like?
Ken: I always maintain
a philosophy. You and I had this conversation when we spoke prior, you’ve
got to smell the roses. You have got to have something that you totally
enjoy doing, whether it’s fly fishing. With me, it’s going on a beach at
my place in Aruba and spending the winter there. Or like Sunday, Barb and
I are leaving for 2 weeks to open up the place. During the summertime,
it’s getting my hands in the dirt in my garden. And then on weekends, my
wife and I canning, and all kinds of good things.
I never think of… I see
individuals that live by these day planners. I never think along those
lines. All I do is just have an idea, and I do it and then I go to the
next thing and the next thing and the next thing.
Dan: I confess, I even
designed a system like that at one time, but I’ve never been able to use
one of those things.
Ken: But you know,
it’s like I’ve set up the mailers are run on automatic pilot. I come up
with a direct mail piece, I rush it off to Kyle when I send the list to
him, and I say, "Okay, code this application this and mail out 250,000,
25,000 of these." So I mean, it’s like on automatic pilot. It’s not like
you have to do it yourself. You should always have these resources to do
it, because it gives you now the time to go ahead and do something else.
Dan: How much time do
you… We talk about this reading and being on alert for opportunity, how
much of your time do you think you devote to continuing education, to
hunting for information, that kind of thing?
Ken: I would venture
to say that a good 25 to 30 hours a week. And on weekends, it depends on
the season. Like when I go to Aruba, I go down with a suitcase of books,
with a lot of material, with my laptop and everything. My typical day in
Aruba is getting up at 4:30 in the morning, getting on a treadmill for an
hour, and then meeting a 72-year-old Aruban that I’ve know for 25 years,
and walking 10 or 12 miles up and down the beach just to freshen yourself,
if I can use that term. Then I have breakfast with Barb, and I sit down at
the laptop and just write.
My system here, in the
office, is very similar. I get off the treadmill about 5:30 in the
morning, and by 6:30 I’m in the office. And I make it a point for the
first 3 hours, just to sit at my computer and write.
And then I go through trade
journals and what have you before the phones start ringing and other
things are happening. And then during the day, I just do. There’s no map
or anything of this is the way it’s done, because a lot of individuals
would also want to do different other things.
Dan: Well, you’re
pretty focused, actually. Like right now, you have what, 3 businesses?
Ken: Yeah.
Dan: Two of them have
to do with the niche market of nursing, right?
Ken: Right.
Dan: Yeah. And of
course, the other revolves around the book and the tapes and the courses.
What do you read like religiously? Newspapers or magazines or whatever?
What do you read every day/week/month?
Ken: I would say about
50 to 55 trade journals that relate to different fields that I like. I
read, constantly, books on business. Because you never know when
somebody’s got a different slant on an idea. But I do read, at least once
a week, a regular novel just for stimulation. But when I read that, when I
read newspapers, when I read trade journals, it’s not like reading for
entertainment. When I read a novel, I just totally am absorbed by the way
they develop the characters and how they do that. When I read newspapers,
magazines and everything, it’s about a business. And I think I guess I’ve
trained my mind automatically to say, "If they did a joint venture this
way, this is how it could benefit them," and so forth. So it’s not so
such… Because you know newspapers and everything really are just bad news
anyway.
Dan: Yeah. Do you read
the Journal?
Ken: Oh yeah, the Wall
Street Journal I read every day.
Dan: IBD?
Ken: No. Investor’s
Daily?
Dan: Yeah.
Ken: Yeah. In fact,
it’s funny. I didn’t even know I was going to be in print. But about 2
months ago, I got a nice letter with the front page of the Investor’s
Daily newspaper from Linwood Austin, saying, "Boy, are you well-known" and
what have you, and it was an interview that I had with a reporter. So I
didn’t even know that there was going to be anything in there. I even
missed it.
Dan: Well, it’s great
exposure. Great exposure. Let’s talk about the book, How To Get Customers
To Call, Buy And Beg For More. What’s there that’s really special?
Ken: Well, most of the
letters that I’ve gotten back from individuals are that it is so readable
and user friendly, where an individual could understand the concepts.
Oftentimes, I’ve gone to some seminars where I needed to bring a
dictionary to listen to the speaker. You know what I’m saying? I mean, it
was like they were trying to impress me with their vocabulary. And what
they were doing, really, was tuning off the major participants that were
there. The book itself is just so user friendly. There’s 37 different
concepts in there that can be applied, some of it to your Gold Members,
whom I assume are really astute, otherwise they wouldn’t be Gold Members.
Because they’ve used, over the years, all of your concepts and everything,
which are invaluable. So a lot of it could be the same. But if they read
it, what will happen is they’ll get a different slant on things, because
it’s really designed for the mom and pop.
Dan: Yeah. Obviously,
there’s a big difference between knowing something and doing something
about it. That’s why we have so many fat doctors that smoke. So there are
marketing concepts that everybody’s familiar with, but have not yet been
nudged into using.
Ken: Let me give you
an example of that, too, Dan. I’m sorry for interrupting you, but I had
this thought. Things and opportunities come about constantly in
everybody’s daily life. It’s like the airline that I was instrumental in
starting from Las Vegas, National Airlines with Mike Conway, and it just
happened at a meeting and what have you. But another good example is I was
out on a fishing trip with this one bank, every August takes 50 of their
best customers out. They were being bought out, so all of the officers
were on board. Nobody was fishing, except for this accountant and I. All
the executives from the bank didn’t know if they were going to have a job
the next day.
I said to Danny, I said,
"Danny," I said… His name was Danny also. I said, "Danny, now’s a good
time to start a niche bank." So we started Shore Community Bank in Toms
River, New Jersey. The newspaper did a big article write-up on us, and the
next thing I know, 2 of my neighbors called up, businesspeople, and they
said, "Ken, we could use a bank here." So we started 2 community banks.
The next thing I know is I’m
sitting down, because I’m a major stockholder in both of them, and I’m
saying to myself, like one bank, we have 5 different banks, big banks, on
the same corner. I said to myself, "How can I differentiate myself from
everyone else? What should I do that will make a difference?" And as a
result of that, I developed from my book, the teacher’s manual and also
the student manuals. Because on the back of my loan officer’s business
card it reads, "In the business of friendly and superior banking services
and quarterly seminars to help you grow your business and get more
customers."
All I did was take my book
and put it into a teacher’s manual and what have you. Any of you listeners
that are dealing with businesspeople, that they want business-to-business,
that would be invaluable for them because they don’t have to reinvent the
seminar.
And the second thing I did
was to put together a direct mail letter to the business community within
a 5-mile radius of the bank. And all it was, was a letter from the loan
officers, stating that they would like to come by and introduce themselves
and just take 15 minutes of their time. And as a token of their
appreciation, they’re going to bring an autographed copy of this book.
Dan: Simple things.
Ken: It is.
Dan: But the 2 things
that I would point out based on what you just said, one, I’m constantly
telling people that it doesn’t matter what business you’re in. Whether
you’re the butcher, the baker, the candle stick maker, you should be in
the information business. You should be providing useful information to
your prospects and your customers, because it’s a great way to
differentiate yourself from every other merchant. And secondly, the gift
with appointment strategy is such a simple strategy, it’s often miss-used
because it’s done with a gift that has no relevance. But overall, it’s a
very effective strategy.
Ken: You know, Danny,
the third thing that I did was to have a direct mail piece go out to all
new move-ins. You know how you do the Val-Pak thing?
Dan: Right.
Ken: This is a
personal letter, because you can get the lists, this is a personal letter
to all the new move-ins and also guess what? To new births. Parents that
just gave birth to a child. On the new move-ins, it was an introduction to
welcome into the community letter and have a gift for them to come in. The
new birth one, maybe it’s my insurance background or what have you,
because my next thing is for those newlyweds and engaged people. I’m
thinking of how I’m going to work on that. But for the new birth, it was
congratulations on the birth of your child, Brian. Knowing the value of
systematic savings, because college education, at the blink of an eye,
goes by so quickly. And now, all of a sudden they’re of college age. We’ve
taken the initiative and started a savings account for Brian for $25. All
you have to do is come in and give us the necessary information to open up
the account. Now, not only have we opened up the account for Brian, but
now the family.
Dan: Of course. It’s
brilliant.
Ken: It’s just all
different things, Dan, that are just so super. I just enjoy thinking out
of the tunnel. To me, I think it’s going to allow me to live to 130 years
old.
Dan: Well, I don’t
know about that, but maybe. God knows you’re physically fit enough. But
banking is an industry… I’m just thinking as you’re talking about this, I
often joke about it from the front of the room that it’s an industry where
there hasn’t been a creative thought in decades. You’re finding ways to
compete with giants. That, in and of itself, is an issue that concerns a
lot of people. It’s what I call the Wal-Mart problem. How do we fend off
the huge giants suddenly moving into our market, or how do we take on the
giant that’s already there? And I wonder if you have some other thoughts
about that?
Ken: Yeah. I’ll use an
example. My girl that takes all the orders over the 800 number, came into
my office. She says, "I think you should talk to this guy, because I don’t
know what to say to him. He wants to buy the teacher’s manuals, which
comes along with the student manuals." So I get on the phone with him and
it was a difficult thing for me to think, but I like to be creative on the
spot, if I can use those terms. Remember how we used to have hot seats at
different seminars and what have you?
Dan: Yeah, it’s the
best part. It’s the best part of the seminar, sure.
Ken: Yeah. I used to
sit there and give 100 ideas to these people as a participant of the
seminar. But the whole thing is, he was a manufacturer’s rep. And what did
he represent? Cabinetry for kitchens. So I’m thinking, and the only thing
I could think about was after gathering information and asking him
questions, he goes to all the retail outlets, the mom and pop stores. What
I told him was that through the same concept, where he did a quarterly
seminar and what have you, 2 things happened. Number one, he got more
people to handle that line. But also, what he did was the customers that
he had already pushed his line ahead of everybody else’s, because they
weren’t doing anything for the business but he was. And all he did was
take 2 counties and do a Saturday morning seminar for a couple hours, and
that was it. He was doing something different than anybody else in that
industry.
Dan: What’s the most
innovative, interesting, maybe even oddball thing that you’ve seen done to
promote or market a business? Maybe in all the people you’ve been talking
to as you’ve done the radio interviews and been out on the book tour?
Ken: Well, you had
asked me a question one time about you found that radio interviews weren’t
working for you and what have you. I found they were working immensely.
Not in the beginning, because I was doing what everybody else did. They
promoted their book. Well, besides promoting the book, I offered free
marketing tip of the week on the KenVarga.com. And once I capture them,
then I can develop a relationship with them. I think most of the time, and
this is what businesses miss the most, is they go, they get the sale, and
then they’re gone.
It reminds me of that joke
about this guy’s up in heaven and he’s getting bored. And all of a sudden,
he says to St. Peter, he says, "Can I go back to Earth?" And St. Peter
says, "No, you can’t. But we do have a proviso in this agreement to Heaven
that we can send you to Hell for a week and that’s it." So he goes down to
Hell, and my God, they’re treating him like royalty. They’re whining and
dining him. He’s having such a blast, but then he’s got to come back to
Heaven. And then he gets bored again and he says to St. Peter, he says,
"Can I go back down to Hell?" He says, "If you go down again, you’ve got
to stay there."
So he says, "Okay, I want to
do that." So he goes down and they open up the door, and now fire,
brimstone, everything. Now he’s being pierced and he’s living an eternity
of Hell. He said to the devil, he says, "How come the first time I came
down here, I was wined and dined and everything?" The devil says, "Well,
that was because you were a potential customer, but now you are a
customer." You know what I’m saying? In other words, we forget to develop
that relationship with our existing customers, Dan.
Dan: So other than
your own business, who’s doing the best job? Who do you know who’s doing
the best job with if you want to call it that relationship marketing?
Ken: I feel a person
like yourself is, and quite a number. I feel that Marty Chenard is doing a
real great job. I don’t know if you know Marty.
Dan: Yeah, I know
Marty.
Ken: I mean, Marty has
taken marketing into a scientific level. I mean, where it’s measurable.
It’s really unbelievable, his systems. I thought I knew about marketing.
When I started taking Marty’s software and doing it, my mailings, my cost
of mailings went down because I wasn’t doing that many mailings, because
it is based on zip codes and demographics, psychographics, and the most
important thing. You’re getting your mailing piece in front of somebody to
be read by somebody who can afford to buy your product.
Dan: You’ve got, in
your core business, 450,000 customers, and you have a renewal situation
with all of them. Right?
Ken: Right.
Dan: They have to
renew how often?
Ken: Every year.
Dan: Every year. So
what do you do in this relationship area to set the stage for the renewal?
Ken: Well, what I do
is prior to the internet concept, I’m in front of them 4 times a year in a
newsletter. A lot of my growth has also been with the referral contest
that I have. And I believe your wife is one of my insureds, so I don’t
even know what your thoughts are, if you even read the newsletter that
goes to her and what have you? Have you ever seen it, Dan?
Dan: I confess that I
have not. I confess that I have not. Tell me about the referral contest.
Ken: It goes once a
year. What I do is all they have to do is… Let me go, in retrospect,
something that I learned. My referral contest was they would just send me
a business reply card back telling me that they want 25 application forms
to pass out to nurses. The policy number would be printed on the bottom.
Well, then I tested something completely different, where I took the
owness of selling off of them. And what I did was they just give me now
the name and address of co-workers, and I have a direct mail piece that
goes off to them, and it starts off with a free gift. "Don’t thank us,
thank your friend, Mary Smith," it’s all personalized, who asked us to
send this gift to you." It’s a book on how to protect against malpractice.
Dan: You’ve just
described something. As you know, for a number of years, very intensely
I’ve worked with chiropractors and dentists. And I still do a fair amount
of work in those practices. Their modus operandi for referrals is, of
course, to put a plaque up in the office and to give everybody brochures
to hand out. And for years, we have taught them collect the names and
addresses of the people who the patient is willing to refer, take the
owness of selling off of the patient, and do direct mail with a gift offer
direct to the referred person. It is so hard to get them to do it. But
when they do it, the results are just unbelievable.
Ken: That’s a business
that could be started, because they just don’t have time to do it then.
Dan: I’ve got a funny
story for you. I’m a Diner’s Club member. And about a month or 2 months
ago, Diner’s did a pitch in their newsletter for referrals. I don’t
remember what the deal is now, but if you refer somebody who opens a
Diner’s Club account, you’d get X number of bonus miles, like frequent
flyer miles. So I’ve got 15 members in my platinum group. So I call the
800 number and say, "Send me 15 of the coded apps and I’ll give them to my
platinum members." "You can’t have 15. You can only have 4." "Why can I
only have 4?" "Because that’s the program. You can only have 4. If we give
you 15, you will waste them. We will only give you 4." Is this classic?
Ken: It is. On my
referral sheet, it has room for 10 names and addresses. But on the bottom
I say, "Please photocopy this form before you start filling in. I
sometimes get 20 to 30 pages.
Dan: Would you rank
that as one of the most effective things you do?
Ken: Oh yeah. There’s
never just one thing, Dan, that a business should do to generate new
customers and profits. There’s a combination of different things that your
listeners should always try to create in order to generate more and more
customers.
Dan: We’re almost out
of time. Any last words of brilliant wisdom here for everybody?
Ken: I always think
about, Dan, always trying different things. When we say testing, testing,
testing and direct mail, I’m talking about testing and testing other
different types of marketing concepts. Just taking them, massaging them,
trying them, and learning from them. But the most important thing is doing
the research, getting your customers to tell you what they want and how to
get it. And that’s a full chapter in the book and everything. It’s so
critical to the success of a business.
Dan: Alright Ken, this
has been great. Appreciate the time out of your busy day, and envy you
your 2-week excursion to Aruba. In contrast, for example, I just got back
from Des Moines. So have a nice time and thanks again.
Ken: Thank you, Dan,
and thanks to all your listeners. I hope I’ve helped them.
Read the feature article in Mentors Magazine about Ken
In
this Feature Interview, it's Kenneth Varga, a dynamic entrepreneur
who has started or bought, built, and sold over 32 companies in
33 years. He is the author of over 300 information products including
the best selling book, How to Get Customers to Call, Buy and Beg
for More! All of his works are based on his experiences of developing
hundreds of thousands of customers through expert marketing. At
this high point of his career, Ken is focusing on being a mentor
and motivating force for entrepreneurs, executives and sales professionals.
In this wide-ranging interview, Ken reveals specific strategies
for profitably using a great variety of marketing success strategies.
Click
Here to read the article.
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