Customer Retention: The Treble Hook Theory
Many years ago I had a Sales Manager introduce me to the Treble Hook Theory–he didn’t call it that, though. It was the “three-pronged fishhook” to him. Over the years I’ve adapted it a bit but the idea remains the same: think of your customers being tied to you by a fishhook.
For those of you who aren’t fisherman (I’m certainly not), an 8lb test hook is designed to hold an eight pound fish. I wouldn’t have a lot of confidence in it holding a real whopper if I were out on the lake. If you have a customer and are providing your products or services just like every other company in your niche, you basically have that customer on an 8lb test hook. Again, not a lot of confidence. In sales terms, it’s easy for a competitor to sweep in and pull them off your hook and take them away.
You don’t have a really good hold on them–there’s nothing really keeping them from replacing you with another supplier or vendor.
But, if you can separate yourself somehow–whether through added services, more value or any number of differentiators, then you set another hook. Now, you’ve got a double hook working for you. It’s a little harder for them to leave–not everybody can do what you’re doing or it would at least be a bit painful to replace you.
My insurance agent is a great example of this. He started with automobile and then got my homeowners and ultimately life insurance and other products. All of which were benefits to me–but, how hard is it for me to change now? It would be extremely tough.
We’re seeing this with television providers now. Cable and satellite companies are getting into internet other service with “bundles”. Those bundles are more hooks.
Ultimately, you want to be using a Treble Hook. That good, old three-pronged fish hook. Once you get a customer or client using you for more than just one product or service or perhaps you’ve found other ways to be of benefit to them–you cinch them in a little tighter.
How can you set that Treble Hook? The first step is to think about it from your customer’s point of view. [Tweet “What can you do for your customer they are having to outsource from another supplier? “] The key in this theory working is each hook is a benefit to the customer–not to you.
Think of this way and you’ll find more and more ways to grow your relationship with your current customer base.