In this episode, hosts Thomas Hays and Ryan Burton delve into the critical difference between new and return customer ratios and their implications for business success. They discuss the importance of understanding customer retention, the challenges many shop owners face in tracking these metrics, and the strategies that can be employed to enhance customer experience and satisfaction. The conversation emphasizes the need for businesses to create emotional connections with customers, maintain high service standards, and utilize effective marketing techniques to ensure customers return. The episode wraps up with actionable insights and a call to action for listeners to improve their customer retention strategies.

Welcome to the HiGear Podcast. We are live here on Riverside and then we're also live on Facebook.

That is streaming right now. If you are listening live You can put a question in the chat comment in the chat might even bring you on air if if you're open to that But we're gonna have a lot of fun here. My name is Thomas Hayes. I'm the vice president of leads near me I'm here with the founder of leads near me the amazing Ryan Burton and co-host of the show. How's it going Ryan?

Doing great, very exciting to be doing the first High Gear Podcast. I know when I listen to podcasts, like this whole beginning part, like I wanna skip through so we can get to the meat of it. You know, you're like listening to podcasts going, okay, when are they gonna get added? So let's do it. Can you see my video? Can you see me? Okay. Am I a little wonky? Okay, all right. It's a good hair day, I hope it works. So really quickly, I'm in carpool.

Yeah, I could see it. Yeah, a little wonky. That's all right.

We scheduled this when I had to go pick my son up. So we're doing, I'm sitting here on my phone. So my apologies for anything technical. Thomas, what is our theme today? What are we talking on the show today, my friend on show one of the high gear podcast.

Yes, so we are talking about this concept that comes up a lot and it's the difference between new and return ratio and how it relates to how much you're spending on marketing.

new to return is something that I think a lot of people discount. You know, they think it's just a metric I need to look at. But when we look at math and we you know, they say the math has to math. If you have.

very few customers, I should say by percentage, a good amount of customers not coming back to you and you're trying to maintain a certain number of customers each month. Based on the math, you have to spend a lot more money in marketing because predominantly marketing is about new customer acquisition. So if I'm churning through a ton of customers every month, they're not coming back. I have to keep refilling that pipeline with paid marketing and that gets extremely expensive very quickly.

And so my take on it is businesses that are not tracking this number are probably, I would suspect in a lot of cases, are spending more than they need to on new customer acquisition. And if they were to really focus on making that ratio more healthy, they would in fact be able to get more business with potentially less spend or at least the same spend and be able to scale more effectively.

Yeah, well said. This is a topic that is kind of near and dear to me. It's one that comes up all the time in conversations I have with shop owners. And I'm going to be just direct. I think most people have no clue what their new to return is, like for real. And it's not necessarily totally their fault. I think we're all guilty as business owners or business leaders of not really having a grasp on this new to return number. And it's so bad. It's so bad than not.

be connected to this number and have it really dialed in. So number one, I will say when it comes to new to return, most shop owners don't have really good data on this. And it's again, not necessarily your fault. So many of the software is out there don't really deliver this data correctly. And it's hard to get. mean, it's hard to, you know, calibrate this data coming out of any shop software or anything really. I think there's a few softwares that do a pretty good job of it, but it's very difficult to figure out. And then second of all,

I think there's other data baked into the new to return number that we're overlooking. So, and I'll talk about that first. The number that I think people are missing in new to return. And I talked briefly about this in our opening at High Gear on Friday morning of last week. You're listening to this in the future. So Friday morning will always be last week now, but no, November 15th. So whenever you're hearing this, that was the day one of High Gear. And I talked about this.

Look, you know, and stay with me on this. If you're listening, if you're still with the show, following Thomas and I right now, stay with me on this. So you have your new customers come, your, excuse me, your existing customers coming in, your repeat customers, and you're like, I know these people. I'm familiar with them. There they are. I see them. I know their faces. I know who they are. And then the new ones come in and you go, yes, you're new. I recognize you're new. But there is a huge problem.

that it's happening with the new customers and that is they're not coming back, right? So you've got all these return customers, all these new customers coming in, but the return customers are really not coming back. And the data shows that 70, 80, 90 % of people that come to your business one time never come back again. And the funny thing about it is, is so many people think that there's signs or signals for this, but there's not. These people could come in, they could leave you a five-star review because you say, hey,

Can you leave me a review?" And they're like, okay. But they were happy, but not blown away. They're pretty good, not excellent, and they don't come back. And then more importantly, there's another shop down the road marketing their brains out. And by the time it's time for work again, they just kind of forgot about you. It's that indifference word that Harry Beckwith taught us in Selling the Invisible. They're just kind of there and not there, so they don't come back. And this is the real problem, because in the new to return number,

You

you really should be dramatically growing year over year. If you're not dramatically growing year over year, it's because you're not retaining. And it really has little to do with new client acquisition. You are acquiring new customers. So that number, I would suggest you do a few things. And Thomas, am I making sense here? Cause I have one more thought to give on this topic. Or lots of thoughts, one more thought in this sort of thread we're going with right now here. So here's the thought. look,

Yeah.

Do an exercise and again, for shops that have 400 cars a month, this is a bit of a bitch, right? This is a bit unfun, but bear with me here, okay? And leads near me whenever I need data, whenever I need to know something, I sit down and I pull up spreadsheets and I look at raw data to figure things out because I need to know the answer. I don't want to go on what I think or pretty good data. I want to know the 100 % answer on something. So.

Again, let's say you have a hundred cars in a month, which is nothing, but this makes this exercise much easier. Go through say October because it's done and look at every damn repair order and say, has this person been here in the last 12 months? If the answer is yes, their return. If the answer is no, they're new, right? This could be an arduous painful process, but I think you see where we're going with this. And then start looking at data.

You

And then get that number and say if you've got 70 that are coming back and 30 that are new, your return, new to return is 70, 30, right? You've got 70 coming back, 30 new, which is a pretty good number. 75, 25 is good. I'm a believer in 80, 20. Why not 90, 10? Why doesn't everybody not come back, right? Or 80, 20, if that math supports it. Why shouldn't everybody come back? Why would they not come back to you? Aren't you amazing?

You

So, then look at another report that you might need to factor out yourself is look at people that came one time and never came back, right? Only one visit ever to your shop and look at those and look at the ones within say a calendar month or a calendar year and start looking at people that aren't coming back to you, right? And that brings us into really what the topic of this podcast should be about. And that's retention. How do you keep them coming back? Because

You

Knowing the numbers is one thing, but getting them coming back is another. But again, the numbers game is critical. I'm a huge numbers person. I can forecast a month down to a nickel. Have been able to for years since a great guy named Bill Hazen taught me how to forecast in 2003. I can look at numbers and make assumptions. Numbers are huge. You should be able to do the same thing. You should never be losing money because you should know how to make adjustments mid-month to make sure you don't lose. anyway,

You

I would look at numbers very critically. I'd figure out if you don't have great software to do it, what is your new to return like for real or you're flying blind. And then those people that come one time and don't come back really understand. And by the way, I'd suggest that's a lot of shop owners because your shop should be growing dramatically if those new customers are not coming back to 2.5 times a year.

You

Dead on. I mean, I think when people think about new to return as well, I mean, they think, well, you know, I can automate, you know, ways to get customers back.

You know and people use CRMs which CRMs are an amazing tool But I think that if we're relying on one way to get a customer back That that's really tricky. So, you know from your experience in business And really in this vein, what are some things that a business a shop can do to really? protect Their customer base and make sure that they're coming back and maybe what are some things that they do that hurt that

Yeah, absolutely. And Thomas, I want to hear your thoughts on this too. I mean, you've been a leader of organizations and involved in customer satisfaction. I mean, you have, and I appreciate that, you know, I'm kind of the boss that leads near me, but you're fricking brilliant. So we need to share your ideas as well here. I'll share mine and then share yours. We're co-hosting this thing. look, it's...

All right.

mean, look, it all comes down to customer satisfaction and customer success, right? I mean, how happy your customers are with you. And if we look back to, you know, to high gear, you know, our speaker, Harry Beckwith, the author of the best seller, Selling the Invisible, talked a lot about, you know, all basics of successful brands, you know, whether it's packaging, pricing, you know, customer

you know, customer satisfaction, all of those pieces play into it. And I think there's a lot of basics that our shop owners are not really concerning themselves with and focusing on. And I think that it's kind of an extra step further in all of this. You have to really be better than anybody that you can imagine out there and then take it even a step further. So I think it's really all of those things. you know, think about, hey, if somebody wanted to compete with us, what would they do to beat us? And then...

And then do those things, do those things and really step your game up. So I think there's a level of maintaining customers, customer satisfaction that shop owners can get to that they're not even scratching the surfaces of. I don't think any of us really have that answer because we haven't fully gone there with it yet.

I agree with everything you're saying. I want to maybe add a different angle to it. think that it I think people overcomplicate it. You know, and I mentioned earlier that, you know, we have some wonderful technology now, CRMs, automated texting, follow ups, all those things. And that is a great thing. But the reason that those exist is that because as a rule generally, and I've been in, you know, shops and help shops for a long time.

Thank

interacting with a customer after the sale is something that just no one's good at. Very, very, very few shops are good at. And I think when we relinquish or abdicate our responsibility to ensure a good customer experience to a tool, we can automate ourselves out of business really easily. And I've seen it before and it sucks. So if we're not making this complicated, know, why does a why does a customer want to come back to repair shops?

Because by and large unless you're like a specialty shop, auto repair shops are pretty much a commodity now. They're all over the place. They're all pretty similar. You know, you're not going to get dramatically different repair results from one to the other. People are primarily looking for convenience, price, you know, and other things are pretty secondary. So if you are one in a sea of other shops, why do they care? And so I think the first thing that we have to do as shops is make them care.

make them really connect emotionally to our brand. And I think that starts with everything from the website to the way our sign looks to the way it smells in the waiting room, the way we're dressed to the counter. We have to awaken their senses and say, hey, we are not like everybody else. We might have a lot of similar properties, but we are actually very different. Our song is very different. so that's the first thing we have to do is differentiate ourselves so that they're

paying attention because that's the worst thing and this was said at our conference last week. The worst thing is not a customer. Steve Jones said this. The worst thing is not a customer having a bad experience with you. The worst thing is a customer being indifferent about you. And so we have to have that emotional connection. That's the foundation. That's number one.

We then have to give great service. We have to fix the car correctly for an auto repair. Whatever service we're in, we got to do the job correctly. That's a bare minimum expectation. But here's the problem with any service based business. People don't know what is quality. All they know is, the noise gone? Is my leak fixed? Is my check engine light still on? Is it still making that funny noise when I turn left?

That's all they know. know, shops that say, well, you know, people come back because I'm the best.

you're you're if you can get the light to turn off you're as best as anybody else and you know, you might be more equipped and have more equipment and you might take more pride in what you do, but people don't care about that. The bare minimum expectation is you got to fix the issue. Now we talk about I've made an emotional connection with you. I've established that I'm not like everybody else. I've done the job correctly, which by the way, if we don't do that, if we're consistently having comebacks more than 1 % of your car is coming back or comebacks. You have a big problem.

that has to be fixed, assuming those first two things are happening, then the last thing is we have to keep ourselves top of mind.

We can do that digitally with top of mind marketing, things like social media, a big, big one that people discount is community involvement. People want to do business with people that are doing good, especially if we look at statistics about the millennial generation and younger, the values of the company that they are interacting with is a big freaking deal. So we have to really make sure that they connect with that.

So then the top of mind marketing and then the last thing is we have to remind them that they exist until we've really connected with them and they visited us and we can really say, they're my customer. We have to remind them that we exist and we do that through text blast. That's great. Follow up texting. But here's one that no one does anymore that used to be drilled into me when I worked in stores. And that is this idea of a callback, a physical phone call.

No one likes to do them. They suck. They're uncomfortable. They're awkward. I'm calling someone who probably doesn't want a phone call in the first place and I'm interacting with them and that's uncomfortable for the person calling. But I promise you any time I've talked to a shop that says we are slow or at any sort of issue, had a quality control issue, whatever and the owner or an advisor or a manager picks up the phone and does a hundred dials. You're going to figure out what's going on. But when you talk to those people, you're going to you're going to make them yours because who does

that nowadays. Everything's automated, everything's a system, a personal connection, a call from their advisor, call from their owner after the fact is gold. And so when we do, we start to think about those things of how do I create an emotional connection? How do I ensure that I'm doing the correct job the right way as expected? And then how do I keep top of mind? That's how you get customers to come back.

Thanks.

and you do that enough times, over time, you have this raving fan base that tells all their friends, and then your Google ads or your mailers or radio doesn't have to do as much heavy lifting. Because at that point, you now have this momentum that you've built because of the fans you have in your shop. That's my take. What are your thoughts on that,

No, no, I mean, I think that, you know, a lot of the stuff you talked about there is are the, the blocking and tackling of what we're talking about, the things you need to do, right? We've got a

make sure the waiting room is nice and all those kinds of things. But I think number one is identifying you're having a problem, like off the bat saying, look, I've got to get better at this. And by the way, even if you don't, why not you just say you did? I was talking to a pastor friend of mine when I was very young and I was questioning God. I was like, you know, I'm not sure, I don't know. And he made a comment to me, something to the effect of

That's huge. Yeah.

Well, even if there is no God, it's good life to live. It's a good way to live. know, this Christian life is a good way to live. Even if, you know, it's a good way to live, right? And I was like, that's a good point. Of course, I have different feelings now than that day. But the point is, is even if you don't think this is about you, why not make it about you and be better? Even if you are the best shop on earth at everything, even if you've won an award and they said you are the best.

Yeah.

at everything Thomas and Ryan are talking about on earth. Congratulations, you're number one. Why don't you still believe that you've got to improve and get better? I think that this is something we all need to be working on our customer satisfaction. mean, we all lose customers too frequently and we could have circumvented that with the right strategies and techniques. And I think, I think number one, it's really knowing that every customer is a person.

Every customer has a story, a family, a relationship. They've got lots of things going on. have challenges going on in their life. those relationships with each one of those people is important. I know you might have three, four, 5,000 customers and that's hard, but to the best of your ability, creating those connections with those people. And that's something Harry Beckwith talked about as well in his presentation at High Gear was relationships.

relationships, people want to do business with people that have relationships with you mentioned community involvement or connectedness. I think that look, you know, when people are talking about car count problems, it didn't happen this month that happened six months ago, a year ago, it happened a long time ago. And it led to today, you know, because a couple things when we do analysis of new business, people that are, you know, I can think of one shop owner right now, who's

you know, frustrated about numbers and then does an analysis and said, okay, everything we've got all these new customers from Google. I don't know if he came flat out and said, okay, it's not you guys, but he said, look, you know, we've got all these new customers. What do you think? And again, it's retention, it's keeping them, it's having them come back in, it's having them be, you know, be fans of your company. And there's something I was going to say, I don't want to try to remember what it is here, but again, that retention aspect that

The phone calls of it, was going to say. And I don't want to make this about a call coaching session. I've been blamed in the past for, you know, passing the blame to the customer on why things aren't working. And this can sound like that. But even this morning, I was talking to a client that said, you know, things are down. And I said, what revenue did you do in November last year? In November last year, he told me, and then he told me what we're tracking for this year. And I said, well, would you believe you have the exact same amount of phone calls this

month as he did last year. And he said, well, I've got a new person answering the phone. And I said, and he goes, but she's not working today. And I said, well, when I called you, she picked up. And he said, what? yeah, she picked up when I called. goes, it's not supposed to be forwarded there today. I didn't even realize that. I mean, we don't know what's going on in our phones. We're not sure. We're blaming this. We're blaming that. And then further, you know, we've got phones that ring through and they, I hear them. The voicemail is pick up is like,

Hey, yo, it's Jim Mann, your favorite bro. How you doing? They're like forwarded to the service advisor's cell phone number or something, and you forgot about it or something, and their voicemail's picking up. And so these details, all these little details, I mean, it's about moving up that field in business. It's one yard at a time. You wonder in pro football why they do these two yard plays, these three yard plays. You're like, why don't you just throw it 20 yards every time? mean.

It's all strategy, moving up the field, getting first downs, field position, all those little details are the thing. So, so yeah, I think that we need to look at everything. We need to say it's us, it's me. I've got to get better and understand that new to return is a customer attention game and they're not coming back. They're voting not to come back, even though they gave you a five-star review because they were like, Thomas asked me for it. So I'm just going to do it. Whatever five stars. He's a nice enough guy.

One thing that I want to maybe touch on for a second, you said earlier that we've been accused of passing the buck, I guess you could say. When someone says, hey, I'm a low in cars, I want to maybe look at that from a different angle for people listening who might be customers or might be a business owner. Marketing works. And marketing is a art.

and it is not black and white and on and off and fixed broken and one plus one equals two. There's a lot of nuance to it. However, there is some data. There is data that we use.

when we talk with with somebody and we're like, hey, I don't think you have a marketing problem. know, marketing works there. It's an art and there's there's a lot of nuance to it. And things can be degrees of of optimized and not and all those things. And that's why we do what we do, because it's insanely complicated more so than I ever imagined before I started working in the trenches. And so every day that is just something that I'm confronted with is how complicated marketing is. But we're experts at it. So that's good.

But when we talk to a customer, there is data. And so when we say as a marketing expert, I don't think you have a marketing problem. We're not trying to deflect. The data is what informs that we can see is your call volume consistent. Are you missing phone calls? What are your calls sound like? We can see your Google ads information. We can see the KPIs and impressions and clicks and all those things. And so when we as experts indicate that and see that there

there seems to be missing things. We're not deflecting. We're actually gathering data. And so our goal is to, you know, if any, you know, money that does marketing should be to partner with the shop or business we're doing with and make sure that everything's optimized because we can control clicks, calls, we can control a lot of things, but I can't control how you answer the phone. I can't control if you do a good job. I can't control a bunch of things on your end. So when we do that, it's not deflection. It's actually to save you money. It's to make your marketing

more efficient and so my encouragement to you if you're working with us you're working with anybody you should be working with us we're the best is recognize it's a partnership that's the the last thing I'll say yeah really

I hope I haven't created that in you. I haven't heard you talk like that before. That's probably my influence. I'm really sorry. I'm sorry about that. Anyway, go on. your thoughts.

But I think that's a good way to end it. Do you have any final thoughts? And then I have a couple things to wrap up with.

Well, let's wrap up quick because I mean, this is a podcast. Let's keep it fast and real, but here's my wrap up. I'm not sure if I was saying data or data. I can't remember what I was saying. I think you may have changed on what I said and now I can't remember how I said it. Data or data. What was, I want to hear this later and understand that I say data and then you said data and then you changed to data to, because I don't remember. I'm now confused if it's data or data. What I was saying before.

All right.

I feel like it was data that feels like a Canadian thing, but I think you said data and change the data. I'm I'm just floating that out there.

Well, I'm from California, so there's some language differences there, but it's funny, my wife's from Michigan, she says sorry sometimes, it comes out. So, I mean, she is. But anyway, yes, okay.

Sounds like a great woman. All right, wrap it up. Let's wrap this up. Final thoughts from Hayes.

Final thoughts great episode if you are listening Pretend you have terrible retention and then overcompensate you'll never go wrong doing that if you would like to listen to more episodes like this Hopefully the tech is a little bit better on the next one. We'll get better and better as we go. You can go Well, that's true that's true. Okay. Okay. No, no, no No, no, no, no

If you don't want to listen, we don't want you anyway. Don't come back. We don't need you. We'll get a whole new round of listeners next show. Screw you. is that? not that. no.

No, not that. We want them to keep listening. It's important.

see it's just it's ever so slightly different you'd be good okay I got you all right

I have some notes for you after the episode.

gonna have to my program director gonna meet with me after go look Burton Here's the thing Okay, just that doesn't work that doesn't play here in auto repair that kind of talk doesn't work here

all right, Hayes.

All right. High gear podcast.com. That's high gear podcast.com. If you're watching this, you can click on that link that's live inside of this podcast studio. High gear podcast.com. Subscribe if you would like to learn more about leads near me. You would like to talk with us about how we can help you effortlessly increase customers. You can go to leads near me.com. Book a call.

You're actually gonna talk to me. You and I are gonna have a phone call. We're gonna talk about your business and see if we can help you and go from there. We'd love to see you on the next episode. We're gonna try to do this weekly. We'll see what happens. But again, HighCarePodcast.com, LeedsNearMe.com if you want to effortlessly increase car count. Thank you for listening. Have an amazing day.