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Are You Committing This Hideous Sin?

When most people think about growing their business, they immediately think about how they can acquire new customers.

Now of course new customers are vital to the long term health of your business but in fact the real money lies in your existing customers.

Focusing too much on winning new customers is a huge mistake.

You see while the un-rich believe the most important marketing is in attracting new customers, the exceptionally successful and rich business owner realises marketing to and nurturing their  existing customers  is paramount.

So why is this so important?

  1. It’s becoming more and more expensive to acquire new customers.
    It used to be that when acquiring a new customer, you could make a profit or at least break even. It’s estimated that winning a new customer costs five times as much as keeping an existing one.  Plus the probability of selling to an existing customer is 60-70% while the probability of selling to a new prospect is only 5-20%.
  2. The majority of customers leave businesses because of neglect.
    There are lots of reasons that we all lose customers and sometimes we screw up and genuinely deserve to lose a customer.
    But the biggest reason for customers leaving is that they feel unappreciated, unimportant, or taken for granted. Something over 70% of customers leave their existing supplier for this reason. If you feel that your existing supplier isn’t concerned about you, when someone else whispers in your ear and offers you a better deal, you have no qualms about moving your business elsewhere.

It stands to reason that if you strategically engineer your business to retain, nurture and grow the value of your existing customers, you will grow your business and your profits.

How do you do this?

Make your customer feel important and valued

Find ways to express your gratitude by acknowledging them and thanking them in your newsletters, by creating a reward program and making special offers specifically for existing customers.. Also, treat them as the valued and valuable commodity they are. Invest time in them and make them feel that their business is important to you.

View retention as a marketing function and a profit center

Don’t think of money spent on existing customers as an expense. Instead view it as an investment.

Have a lost customer plan in place. 

Track your customer’s activity. When one goes missing, send that customer a letter with a great offer or pick up the phone to find out what’s going on. You need to be persistent. Losing customers will be very damaging to your business.

Develop new products and services for your existing customers. 

Your existing customers may have moved beyond your initial offering. Work hard to do more business with them by coming up with new offerings that will appeal to their wants, needs and desires.

Your existing customers are your most important asset. If you want to grow your business and profits, neglecting them is one marketing sin you don’t want to commit.