It doesn’t matter what type of business you run - the most proven and effective method of increasing your sales is to grow and nurture the existing value of your customer or member base (see our previous article on this topic)
By having worked through a similar issue with our clients in the past, the results often show a substantial growth opportunity by increasing and using their existing database to secure new business.
Just follow our 6 simple steps that you can start doing today!
Step 1: Collect your customer data.
It doesn’t matter if you buy or hire an expensive Customer Relations Management software or whether you use a simple Excel spreadsheet - you need to list all your customers and/or members over the last 3 years and the value they brought to your business within the last year.
Step 2: Identify growth trends.
Now that you have collected the above information, you need to list whether these current or past customers or members are inactive (no revenue generated from them), are growing in value (spending more in your business), are declining in value (spending less in your business) or whether they are constant each year (no loss/growth).
Ensure that you are completely frank with yourself when doing this! Sometimes our clients think their customers or members are in growth mode but in reality they're not, or they list them as generating a constant stream of revenue to their business, but they're actually bordering on decline.
Step 3: Reactivating inactive clients.
Put together all your inactive customers or members together, and put them all into a new and separate list from the one you just created, and develop a strategy to reactivate them. The most obvious way to do this is through communication - a phone call, a visit, an email, a letter, a special promotion or offer.
Step 4: Release declining customers.
You need to make an honest decision on whether you want to keep or let go of customers or clients that are declining in value for your business (especially if you are at break even with them or even worse – losing money).
Question: But hang on, why is this happening in the first place!?
Possible Answer #1: You might have a weak relationship with them
Possible Answer #2: Communication might be a factor – do you communicate with them? They might have forgotten about you!
Possible Answer #3: Your products and/or services might no longer cater or solve a real need they are seeking.
If you don't know the answers to these questions yet, then try to find out, otherwise you can't arrest the decline in business from this group. You need to talk to your customers or members and find out what has changed even if they tell you they no longer want to do business with you; this will help in your market research process.
Step 5: Identify growth clients.
Highlight customers or members who represent a growth to your business, or who have an opportunity of grow in the future.
Step 6: Match products With Customers.
Start of by listing all of your product or services your business provides to your customers or members. Give them a name, a brief description, and a price.
Refer to the Customer Database you just created. If you currently have 5 different products or services but most of your customers or members only have a use for one or two, then you need to focus on which customers or members can benefit from those – there may be an opportunity to look for niche customers or members that you may not have thought about that might find use from them!
Alternatively you could think about how these products or services could work for your existing customers – maybe refining or changing something within their offerings. There is an opportunity to double the value of a customer or member if you are able to do this!
If most of your customers or members can't really benefit from the other product or service offerings, then you have the wrong products/services, or worse yet - the wrong customers or members!
I'm busy working on my blog posts. Watch this space!