While many organizations work hard at chasing and seducing new prospects, they risk missing the opportunity to grow by increasing the value of existing customers
The good thing about encouraging the customers you already have to use more of your products or services is that it needn’t cost much money. Just use every bit of the ‘brand’ that touches your customers – from packaging to your website, from manufacturing to customer service. Use it not just as a promotional tool, but to actively encourage repeated usage.
The best way to grow business from existing customers is to keep them interested in your product or service.
Why bother with existing customers?
1. Achieve better conversion rates
This is because trust and confidence has already been established. It’s easier to identify customers’ real needs – because you know something about them already. It is also non-competitive in as much they are already your customer, to some degree, and you are not trying to lure them from a competitor.
2. Spend less on marketing
Targeting existing customers means you’ll spend less time finding them, less money getting the right message across , and less time convincing them that you are worth doing business with.
You’ll also spend less on customer research – you may already have some positive feedback from them.
3. Make more profit
You’ll spend less time getting up to speed with the needs of existing customers, and (usually) there’ll be less pressure to discount the price than with new buyers.
Your business operations become more efficient and effective as you know what customers need. It may also be possible to get the customer to trade up to other products or services – since they trust you. This is called higher leverage.
4. Increase product or service complexity
Your organization needs to grow and develop to remain competitive – so you may be able to do more complex work with existing customers. It can be difficult to sell to new customers outside your established track record.
Whenever an organization is trying to interest a customer into buying an additional product or service, there’s one thought going through the customer’s mind: ‘Why are you trying to sell me something?’
There are, of course, only two possible answers to this question. Either they believe you’re really interested in their situation, and them, and have a sincere desire to help them, or else they believe you’re just trying to generate additional revenues for your business. Whether or not your selling effort succeeds depends solely on which of these two things they believe about you. If they believe you’re interested in them, that you care, and that you’re truly trying to help them, they’ll buy from you.
Lastly, if your customers aren’t actively telling their friends about you, maybe your product or service isn’t as great as you think it is. Furthermore, if you aren’t getting consistently great word-of-mouth from your existing customers, you’re not ready to start marketing to new ones.
Source: Marketing Donut