Business Lessons on Growth from the Garden

Where I live, May is the best month of the year for gardeners. It is the season of endless possibilities, the time when we can begin to put to work the ideas we dreamed up over the winter—in my case, while leafing through old English Garden magazines in front of the fireplace.

I have been gardening most of my life, but things really accelerated with our purchase of a summer home on Cape Cod. On the Cape, we have a kettle hole garden, situated in a depression formed by a melting block of glacial ice, that nicely protects plants from the wind. Combined with the area’s relatively warm temperatures, moderated by the nearby ocean, there are many plant possibilities—and in the early years, I made frequent buying trips to the local garden centers.

At that time, I didn’t really know the difference between an ephemeral, an annual, or a perennial, but I was eager to try them all. Today, after years of trial and error, I know that frequently replacing annuals and ephemerals is expensive. Now my garden is chock full of perennials that come back every year and multiply. Instead of regular (and expensive) trips to the garden center to buy more plants, these days, I spend most of my time tending to the existing plants, pruning back, and thinning out.

Executives who wish to grow their business could learn quite a bit from experienced gardeners. First, it takes time to build and sustain a business, just as it does a beautiful garden. Don’t let the siren song of immediate gratification drown out the fact that we are on a multiyear journey.

Second, chose what you cultivate carefully. Gardeners who acquire mostly annuals and ephemerals sentence themselves to never-ending expenses. It can make sense to include some annuals, such as pansies, petunias, and pelargonium, but they take an awful lot of work and must be reacquired and replanted each year. Ephemerals like bleeding heart and trillium are lovely, but only bloom for a week or two before retreating into hibernation—maybe repeating for a brief display the following year but more typically dwindling over time. The backbreaking work of weeding out the open spaces they leave and replacing the spent flowers never ends.

Contrast that with the patient gardener who cultivates perennials, investing in some lovely foliage plants, such as hakonechloa or hosta (my favorites include Sum and Substance for sunny spots, and Jack Frost for semi-shade), or for colorful flowers, geranium Rozanne, or daylilies such as Stella de Oro (or Happy Returns if you prefer yellow to orange).

Healthy, sustainable businesses must attract and nourish perennials as well. If your customers find a happy home with the company and are well cared for, they will repeat and flourish—and refer their friends. Like a daylily to a garden, referrals become the backbone of a healthy, thriving business. Leaders who learn how to attract and cultivate the right customers delight them and then activate as many of their referrals as possible, and they will build something that can thrive in the long term.

Yes, perennials require a bit more investment up front, but when correctly planted and cultivated, they increase and expand. Before you know it, you will be dividing mature clumps and spreading them around the garden. Well-chosen, well-tended plants will grow to fill an entire bed—indeed acres of beds (and neighbors’ beds when you gift them your extra divisions).

This is the key to building a beautiful and sustainable garden efficiently—so, too, a good business, but too few marketers recognize the difference between ephemeral customers and prospective perennials. Even if they can tell the difference, their key performance indicators encourage acquiring new customers as cheaply as possible for immediate bloom, giving little attention to future seasons and likely repeat and expansion. If ephemeral and annual customers are easier and cheaper to attract through advertising campaigns, marketing promotions, or sales incentives, then it is likely they will dominate the inflow of new customers—and the garden will need regular replenishing.

Customer prospects obviously aren’t organized into annual, ephemeral, and perennial sections with labels similar to those at a garden center. The best way to acquire customers likely to become perennials is to earn them through referrals. A smart business leader who wants to build in a healthy growth rate will make sure that as many new customers as possible result from referrals of existing customers. I see evidence from multiple industries that referred customers are happier (awarding higher Net Promoter Scores), stay longer, purchase more, are more profitable, and are more likely to refer their friends. My recent experience indicates the very best businesses acquire 50% or more of their new customers through referral while laggards garner only 10% to 20% this way.

A well-tended garden can be a very happy place, enjoying perpetual and sustainable growth at very low costs. When it comes time to sell your home, the street appeal of a great garden adds value.

But if your marketing team is acquiring mostly annuals and ephemerals, your future is not very bright.

For business leaders wondering why customer acquisition costs are spiraling out of control while revenue growth remains modest, I recommend asking your marketing team this simple question: What percentage of our new customers this year came through recommendation or referral? And what actions do we need to take to double that number?

My long-term goal as a gardener is to have perennials filling most of my beds. The best corporate gardeners have a similar goal. See you in the garden.