Henry, the owner of a gutters and window cleaning business, recently ran into a big problem—stiff competition. A couple of new cleaners had started moving in on the neighborhoods he targeted. And they were good, as good as he was.
He had considered trying to compete on price, but decided not to do that. He was right. Cutting prices was not the winning strategy for him. It would put too much pressure on his business and eventually hurt his ability to deliver high value. Plus, he wanted to run a profitable enterprise. Price is also only one of many factors potential clients consider. So you have other levers you can explore, including the one I recommended to Henry—social proof.
The skinny on social proof
Social proof is a really powerful way to encourage your prospects to choose you over your competitors. It essentially describes a type of behavior social psychologists call conformity, in which people faced with a decision will follow what others have done in the belief that others must know what they are doing. It’s a little bit like peer pressure or the “monkey-see monkey-do” effect.
The theory of social proof started coming together way back in 1935 when Muzafer Sharif, one of the founders of modern social psychology, showed that individuals will tend to follow the consensus of the group when there is no clear right answer. Since then, smart businesses have used the power of social proof by showing prospects evidence that others have used their service and recommend it. And governments have been turning to it as a more effective way to get someone to go green than appealing to their concern for the environment or even saving money.
These days the stats on social proof are pretty impressive. According to Google 70% of Americans now say they look at product reviews before making a purchase. And according to the Edelman Trust Barometer 65% of consumers trust “people like me” first for product and service advice.
So, how do you collect social proof and use it to trump your competitors?
Collecting social proof is pretty straightforward. It’s all about asking for feedback and giving clients easy ways to talk about their experience with you. You could ask simple questions at the close of a job. Things like, “What do you think?” or “How is it working now?” Then ask for permission to use those answers as testimonials. To create opportunities for your customers to provide social proof, make sure your website or blog is set-up to make it easy for customers to leave comments, reviews, and ratings. And give them options to share and like across all the social media sites.
Henry liked the idea of using social proof to deal with his new competitors, especially because he had something they didn’t—a track record in his target neighborhoods. To get going, he improved the comments and review features of his website, and personally called up some of his loyal fans for endorsements. He then included testimonials in his web copy, flyers and email campaigns. By doing all this, he created potent social proof that he was the best choice for his prospects.
It worked. In fact, he began to grow his client list faster than before the new competitors had moved in on his territory.
The final word
When making a decision, price is important to your prospects, but above all else they want reassurance. They need to know: will the job be done well and on time, what are you like to work with, can they trust you? And they trust what others have to say. Collecting social proof and sharing it with your prospects creates that reassurance and can turn more of them into clients than any other approach.
About the author: Andy Haynes is a writer for FreshBooks. He is the co-author of two best-selling business books, a successful entrepreneur and business consultant.
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