I’m sitting here at Maxim’s Restaurant, my go-to-place after Sunday church; a place that lets me camp out for up to 3 hours on its busiest day of the week. (More on that below in the conclusion to this week’s TO THE POINT blog.)

I recently caught a social media post and video that drew “deep thoughts” during my “All-American” breakfast (bacon, sausage, eggs, hash browns and sourdough toast). The post had me thinking about our business here at Lessiter Media, and also about yours…

Sales consultant Joey Baghdadi posted commentary to LinkedIn and an interview with Jon Taffer, who most of you know for the reality series Bar Rescue on Paramount Network. It delved into Taffer’s departure from first-customer marketing and more directly, the path to customer conversions via an intentional, precise buying experience program. 

As Baghdadi notes, Taffer builds fear of missing out (FOMO), manufactures urgency, optimizes first impressions and even scripts the moments that people can’t help to share with others — all at a fraction of traditional marketing spending. 

“Attention is the currency and experience is the leverage,” Baghdadi says.

Knowing the Numbers

You’ll need a little imagination to draw correlations to your business, but you can handle it, just as I did.

Taffer explains a truth of the restaurant business — that repeat, not 1-and-done, customers are necessary to survive in a tough biz. “Even when the customer has a flawless experience, the statistical likelihood of them coming back to that restaurant is only about 42%. If you come back and have a second flawless experience, your likelihood of coming back a third time is still under 50%. But if you come back a third time, the likelihood of getting a fourth visit is 72%.”

While others market and spend on getting that visit (sometimes $1,000 just to get a single customer to the table), Taffer lives by “3-visit marketing.” 

The business of doing business, from what I learned from Taffer, is the marketing program itself.

Step 1

Here’s what happens when someone comes to a Taffer-led restaurant. “We ask if they’ve been here before and if not, we put a red cocktail napkin down on the table. Everybody else has a white napkin. ‘Why do I have a red napkin?’ they ask. ‘Well because you’re a new customer and we want to make sure we welcome you.’

“That feels pretty good. The manager must come and introduce themself during that visit and explain that we’ll mail a card for free rib dinner — no restrictions at all.”

Step 2

So they come back with that postcard, and Taffer's team puts the special red napkin down. Again, a manager comes to ask how the meal was. “Oh, you gotta try our chicken,” we say, “and she writes on the back of her business card a note for a $5 chicken dinner.”

Step 3

When a customer comes back with that handwritten note, there wasn’t any outside expense made to get that customer to the table. “Again, at the end of the meal, our manager asks how it was and adds, ‘You gotta come back another time and try the cheesecake,’ and then we write a note for a free piece of cheesecake on the card.’

“For the price of the cheesecake, I get you back in for the third visit and thus a 72% likelihood that you’ll come back again.”

Taffer says that in a market like New York, you better know your advertising spend, your number of new customers and your acquisition cost. “For every new customer I get, it costs me only about $8,” he says. Other shotgun marketing tactics focused on a single visit, meanwhile, may cost well over $1,000.

Acquisition Cost & Customer Lifetime Value

Granted, Taffer’s stats are restaurant related, but they’re interesting for understanding consumerism. And for your business, I’d ask:

1. Do you know your new customer acquisition cost? 
2. Do you know what your customer lifetime value (CLV) is? CLV is total revenue you can expect from a single customer throughout the course of your entire commercial relationship. It can be factored for total net margin as well.

Most don’t know their own numbers, I find. Our business is funded largely by advertising and sponsorships, but I’m shocked that some companies have no idea what each new (and eager) dealer means to their enterprise. In this day and age, more sales usually require more qualified distribution, and few marketers seem to know what even one more outlet is worth to them — over the next 5, 10 or 20 years. 

When dealers hang on to their suppliers for many decades or more, that first one often equates to an “open order.” And since each new dealer generally comes with stocking requirements and enough parts inventory to cover the machine populations in the dealer’s AOR, it’s significant.

Instead, many cling to that old joke that “half of my marketing budget is a waste, but don’t know which half.” Some might know their annual advertising line items and maybe even their printer bills, but not their postage/mailhouse, list rental or staff time in calls, stuffing parties or per-post social media costs, etc. 

Unlike the auto business, we’re not creating new market demand every time someone turns 16. 

When you know your numbers like Taffer advises, you can afford to do different things to earn the customer’s loyal business — a business that’s all about experience, after all. Marketing in the equipment business has gotten more sophisticated, but it’s still relatively easy to stand out …

It’s never been easier to know your numbers (give AI a shot at it) — and to make good decisions on what a comprehensive analysis provides you. If you need help, our Audience Development team can help you sort it out; we know the right questions to ask of your accounting system.

Final Thoughts: Back to Maxim’s

Maxim’s Restaurant lives up to its name with its white-covered walls sprinkled with calligraphy of uplifting, sentimental and thought-provoking sayings. Every different booth or table in the expansive restaurant exposes you to different “maxims.’ As a “quote guy,” I’ve photographed and shared many maxims over the years. In fact, it’s part of the experience of the place. 

The food is pretty good and of great value (most “normal” people get two meals out of one order) but it’s the staff that makes the difference. I’m not willing to go anywhere else and cross my fingers that they’ll tolerate a booth-squatting writer like me. They’ve earned my loyalty and the greeter/seaters, wait staff and coffee and water servers ensure I never have a bad experience. 

Several other nearby restaurants closed recently, but Maxim’s still operates as though the competition is fierce.

I’m always given a private booth no matter how crowded. They often ask me about the topic of the articles I’m writing about and like to joke about my coffee addiction (though they’re partly responsible for it — I’ve never seen what the bottom of the mug looks like). 

I gladly give them my business because “I want to KEEP them in business.” And the kind of place that I can afford to share a 50% tip. 

What can you — and more importantly the people you lead — do to create a personal experience and to land that customer who keeps coming back because they can’t depend on getting it elsewhere?

Use the commentary box below to let us know what you’ve borrowed from other business models and found to work in the equipment business…