Expand Via Related Links

Why did Friendster fail?
     Business researchers at Harvard University and Bank of Canada claim it was because of poor expansion. Friendster, a predecessor of Facebook and begun on a similar business model, opened up recruitment to anybody who was interested. The result was participation by consumers who often found too little in common with each other. The social networking magic floundered, and so did Friendster.
     Facebook, by contrast, started out by targeting college students and, only when there were enough of those on board, expanding to people who were like college students, and then progressively expanding further to target markets with characteristics similar to those of Facebook’s current consumer base.
     In your retail operations, expand this way. Certainly, do pursue weak links. Say to your satisfied customers, “Recommend us to your friends,” and also, “Recommend those friends talk about us to their friends.” But do it in this way because friends of friends are likely to be similar to the recommender in some ways. They are what the business researchers call “adjacent markets.”
     “Friendship is born at that moment when one person says to another: ‘What! You too? I thought I was the only one.’” So wrote C. S. Lewis, well-known to many as the author of The Lion, the Witch and the Wardrobe.
     To better fit the realm of retailing, I’ll tweak the C. S. Lewis quote to read, “A customer referral relationship is born at that moment when the consumer says about the retailer: ‘What! I’m thinking there are many others who, like me, could benefit from all you offer. I’m far from being the only one.’”
     You might even want to take the initiative in discouraging customers who don’t belong. Some years ago, Kelvin MacKenzie, then editor of The Sun, Britain’s best-selling tabloid, received news that a reader had become so outraged with the paper he was thinking of cancelling his subscription.
     Mr. MacKenzie took no chances. He notified the subscriber that the man was now banned from not only subscribing to, but also reading from,The Sun ever again.
     This story brought to my mind another anecdote, told by comedian Groucho Marx about a possible cancellation of his club membership. As Groucho relates that tale in Groucho and Me, “I sent the club a wire stating, ‘Please accept my resignation. I don't want to belong to any club that will accept me as a member.’”

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Cultivate Referred Customers 
Grab On with Weak Connections 
Reserve the Benefits of Exclusivity