The Second Rung

Dear friend,

The riddle first. Your century today, and the subject is a question asked by a delighted customer that most trades cannot answer.

Two firms both please the folk they serve,
Both earn the thanks that they deserve.
One sells one thing, and only one,
One has a second when it's done.
By spring, one's takings doubled clean.
Where was the money in between?

Hold your answer. Story time.

The Story

Two firms in the same trade, and the work, all together now, was equally good. Both had happy customers, which is not a phrase to skate over: both had built the hardest thing there is, which is a group of people who trust them.

The first firm sold one thing. It did it beautifully. And at the end of every job the customer would say some version of the sentence that ought to make a trader's heart lift: this has been brilliant, what else do you do? To which the honest and rather proud answer was: this is really all we do.

So the customer said what a pleased person says, which is that they would certainly recommend them, and went off to spend money elsewhere on the next thing they needed, frequently on the very problem the first job had uncovered. The firm never saw a penny of it and never even knew the money had moved.

Meanwhile the owner spent his mornings on advertising, on the endless grinding business of finding strangers, because his only source of revenue was a person who had never heard of him. He had built a bucket with a hole in the top: everything had to be poured in from outside, and everyone who filled it walked away full of goodwill and no further use to him.

The second firm sold the same first thing and then paid attention to what people asked for afterwards. Not what would be clever to sell. What customers actually said, in the last week of the work, over and over, in their own words. Three things came up so often that ignoring them started to look wilful: could you keep an eye on this for us, could you do the same for the other branch, and can you show our own people how to do the small stuff.

So there was a second rung: a modest arrangement, quarterly, for keeping an eye on it. Perhaps a third of customers took it. It was smaller money than the first job and it arrived every quarter without an advertisement, from people who already trusted the work, which made it the most profitable line in the business by a distance.

And the second rung did something beyond its own revenue, which the owner had not anticipated. It kept her in front of people. When the bigger job came round again, or their cousin asked who to use, she was not a firm they had used once eighteen months ago. She was the person they had spoken to in March.

The Lesson, Since You've Earned It

A delighted customer with nothing left to buy is a sale you have already lost. And it is the most expensive sort of loss, because you have paid the full price of winning them: the advertising, the proposal, the nerves, the doing of the work. Everything after that first sale would arrive with no acquisition cost at all, and a trade with one product forfeits all of it, quarter after quarter, while congratulating itself on being focused.

Notice this is not the farrier's lesson repeated. He was telling you what a customer is worth over forty shoes. This letter is about the man who shoes a horse superbly, once, and then has nothing whatever to sell that customer for the rest of their natural life. The value is there. There is simply no vessel to collect it in.

So build the second rung out of evidence rather than imagination. The right one is nearly always sitting in what customers ask for in the last week of a job, and it usually takes one of four shapes: keeping it working, doing it again elsewhere, teaching their people to do the small parts, or the larger version of what they just bought. Write down what your last twenty customers asked for after the work and you will not need a strategy day; you will need an afternoon and a price.

Two cautions. Do not bolt on something unrelated because the margin looks good, since your customers trust you for one specific reason and a second rung that has nothing to do with it will simply confuse the trust. And do not wait for the perfect version: a modest arrangement, plainly described, offered in the last week while the goodwill is at full strength, beats a beautifully designed programme launched next year.

Three questions, and go through your last twenty jobs before you answer:

1. What did they ask for afterwards? Collect the actual sentences, not your summary of them. The pattern will be obvious within twenty jobs, and it is the only reliable market research you will ever get for nothing.
2. What happens the day after you finish? Trace what the customer does next about the problem you uncovered. Somebody is being paid for it. If it is not you, decide whether that is a deliberate choice about what you do, or simply a gap nobody got round to filling.
3. What could you offer next week? Not the ideal second product, the modest one you could describe in three sentences and price today. Offer it to the next three customers in their final week and see what happens. Two afternoons of evidence is worth a year of planning.

The Answer to the Riddle

Where was the money in between?

In the same customers, both times. One firm collected the first sale and let everything after it walk out of the door with a compliment; the other collected the first sale and then had somewhere for the goodwill to go. Nobody's customers were richer, nobody's work was better, and nobody advertised harder. One of them simply had a second thing to sell to people who had already decided they liked her.

The verse:

You win their trust, you do it well,
And then have nothing left to sell.
The gratitude walks out the door
And spends its money next door, sure.

Until next time. Go and write down what your last twenty customers asked for after the job, and price the commonest one this week.

P.S. The best moment to offer the second rung is the final week of the first job, while you are still in the building and the work is visibly good. Wait until three months after and you are a stranger sending an offer. Say it on the last day and you are the person who has just fixed something, mentioning what happens next.

Also in the archive: The Farrier's Fortieth Shoe, April and October and How Many Pints Were Drawn.