We took a 30 second survey asking payday loan and car-title lenders what their biggest problems are. We’ve received over 1000 responses and continue to receive more daily.
(By the way, this is an ongoing “30 Second Quick and Dirty PDL Survey” you can access here: http://goo.gl/iDX6T This is the link to the Survey Page using the Google Shortener Tool.! If you take it, we’ll share our results with you! Experience of our respondents to this Survey varies from zero to 20+ years. The average is 3.3 years)
Before we reveal the #1 challenge revealed by 1000+ payday loan and car title loan business professionals, here’s a brief rundown of the other top responses to our quick and dirty survey in no particular order:
- Collection tactics and underwriting and tools
- Hiring and keeping good employees
- New products and services that can be added
- How to generate/buy/sell Internet leads
- Access to capital to grow your business
- Adapting to Government and legislation
- How to harness the Internet to increase revenues and collections
- Payday loan and car title loan software selection and issues
- Finding good locations and accessing their potential for success
- Developing and maintaining a good quality industry image
- Developing new business models in addition to the State Law Model, the Choice-of-Law-Model, the Sovereign Nation Model, the Offshore Model, the Peer-to-Peer Model, Installment loan products…
- Training in all aspects
- Legal questions about laws, organizing the business, Internet licensing
- And a hell of a lot more…
So… drum roll please… The #1 challenge revealed by our readers for help and insight?
“Getting more customers.”
Alright, let’s tackle this issue. First things first – DEMAND is UP! Yep, hopefully that doesn’t surprise you!
I talk to entrepreneurs in the payday loan industry, car title loan industry and many related AFS businesses (Alternative Financial Services) everyday. These business people call and email me from everywhere … from the USA, Canada, the UK, Australia, Korea, Africa, Mexico, New Zealand… and DEMAND is up. Customers want and desperately need our product; short-term, no-hassle quick access to small loans.
Sure, our demographics are changing! Potential customers with multiple credit cards and higher incomes – customers who previously wouldn’t consider us for temporary financial help – are now considering us and actually using us. And many of our past customers are unemployed! Las Vegas has a 15% “official” unemployment rate! The “official” rate in California is 14%; we know among our customers it’s higher! So demand isn’t down it’s just that our customer is changing.
The problem is we’re all going after the same customer in the same ways while our customer has changed. These potential customers listen to different radio stations, watch different TV stations, read different web sites and blogs, drive different cars, read different magazines and newspapers, use Facebook, Twitter and Google … And these customers are applying for our products and services in multiple ways! It’s not uncommon for them to make a phone call, visit a store and apply via a web site! Our customers have “MOVED.”
These customers are more sophisticated. They have better educations with higher expectations. They are more aware of their options and require more attention.
I can’t use this Newsletter issue to discuss every method available for you to get more customers. It’s a HUGE subject and I’ll discuss more in coming issues. So let’s begin here with one thing you can do to make an immediate impact on your revenues; it’s simple BUT not the easiest tactic to implement.
It’s called HOSPITALITY!
Yeah, that’s correct – HOSPITALITY.
So… what do I mean by HOSPITALITY? Well, as Danny Meyer states so eloquently in his book Setting the Table, The difference between SERVICE and HOSPITALITY is the foundation of success. SERVICE is the technical delivery of a product. HOSPITALITY is how the delivery of that product or service makes its recipient FEEL. SERVICE is a monologue – we decide how we want to do things and set our own standards for service. HOSPITALITY, on the other hand, is a dialogue. To be on a guest’s side requires listening to that person with every sense, and following up with a thoughtful, gracious, appropriate response. It takes both great service and hospitality to rise to the top.”
On a superficial level, “Setting the Table” is a book about starting and running retaurants; some of the best restaurants in the world. But on a higher level, it’s about business and customer service. I highly recommend it to you!
There’s a story that a business man opened a new store in Florida. On the day the business opened, the business owner received a surprise phone call from Gov. Jeb Bush. Gov. Bush thanked the business owner for doing business in Florida and offered this business man a “special phone number” should he ever need anything. Imagine the impact with your new customers if your company used this tactic. And imagine the fantastic feedback and insight you can receive from your customers.
“Hello Mr. Jones. This is Jerry Ayles at San Diego Financial Service Centers. May I take a few seconds to thank you for visiting our store/web site this week.” THEN SHUT UP! Listen! Allow your customer TO BE HEARD! People love for you to show a genuine interest in them. There is no stronger method of developing a relationship with another human being than to display a true interest in THEM and allow them to share their experiences, their stories, and their lives with you.
OK! I know what’s going on in your head right now! You’re thinking, “Is Jer nuts? Does Jer really think I have time for this?”
My answer to you is, “Can you afford NOT to do this?” Time and time again, I’ve written about the life-time value of your customer. Let’s review this quickly here again. Say… 4 loans per year… $300 per loan… $45 in fees per $300 loan = $180/year in fees X 10 years = $1800 total life-time revenue per customer. And these are conservative numbers! Substitute your own fees and average loan amount and the number of years this customer will stick with you.
Isn’t it worth 2 minutes of your time (or the time of a well trained member of your staff) to implement this?
How can you afford NOT to do this? How can you afford NOT to gain unbelievable insight into what’s going on in your customer’s head? How can you miss an opportunity to gain another apostle for your business? How can you fail to ask them for referrals of their family and friends? How can you afford to fail at this simple strategy?
Final thoughts: When you’re fortunate enough to entice a new customer to give you a try you’d better hit a home run with them on their first experience with you. Again, as Danny Meyer’s writes, “Your goal MUST BE to earn, regular, repeat patronage from a large number of consumers.” AND don’t think I mean putting them on a path to the so-called “cycle of debt.” I simply mean earning their trust and respect as they become acquainted with, and actually use, a variety of the products and services you offer in your financial service center.
Now another thing YOU MUST DO! Get your customers email addresses, Facebook accounts, twitter accounts… Ah!!!!!!!!! This thing is too LONG ALREADY. Next time…
As others have said, “Excellence is a journey, not a destination.”
Meanwhile, WHAT DO YOU THINK? Comments, suggestions, your ramblings are DEMANDED ?
Jer@PaydayLoanIndustry.com
Jer@AutomobilePawn.com
