Let's face it; your current clients are essential. They are already paying you for services, and are likely happy with your offerings, especially if they've been long-term customers. It would be best if you continued to evaluate how you can offer value to your current customers by identifying opportunities that will help generate revenue for them and in the long run ... you.
Gaining more revenue from your current client base doesn't have to be a difficult chore. Learn how to increase your company's revenue from existing customers in five easy steps.
Calculate Your Customer Value
Do you know how much it cost your company to close a new customer? If not, grab your calculator and do the math.
CAC = Total Marketing Investment / # of Customers Acquired
How often you calculate your acquisition costs depends on the volume of customers you bring in. An advertising firm that brings in a few new clients every quarter may decide to calculate CAC quarterly or annually. An eCommerce company may choose to calculate this number daily. No matter how often you calculate your CAC, it matters. New customers are 5x more expensive to acquire than what it costs to keep current customers.
Think about your past experiences. Very few people will spend $500 on new boots after they see one Facebook ad. And, almost no one will hire a consultant after one introductory phone call. People like to be wooed - once you've wooed them, keeping them happy can pay off big down the road. There is another formula that will help you understand the long-term value of every customer you attract - your customer lifetime value or CLTV.
CLTV = Purchase Value x Purchase Frequency x Customer Lifespan
For example, if a person buys a $5 coffee once a week for a year, their lifetime value would be $260. Think about the possibilities if the customer begins coming multiple times a week - the result is a lot more money in your pocket.
Marketing Never Stops
Ask yourself, after you close a customer, will your competitors stop marketing to them? If not, why would you? Your existing customers need to be reminded of the value you bring to them, so resist the urge to focus all your attention on attaining new customers.
There are three effective ways to market to existing customers: email, social media, and content.
If you don't have a newsletter currently, now might be a good time to start one. This is a great place to share valuable content and exciting company news.
It's also good practice to follow new clients on social media and encourage them to follow you as well.
Write content that best fits your customer base - and ask for feedback. No matter your approach - continue wooing and marketing to current customers.
Most businesses fail to tailor their messages to specific audiences. Business owners believe everyone needs their service. They see endless possibilities for sales, and their marketing efforts reflect that. Trying to appeal to every person who fits your basic customer profile will not yield more customers then appealing to a smaller subset.
While a large portion of the population has iPhones, there is still a good mix of Apple's target market that opt for Android. Remember, you can't make everyone happy, even if you think your service is made for everyone.
Focus on the customers you already have and turn them into brand evangleists. Ask yourself - who is willing to give a testimonial?
Get to know your customer base better by:
Send Surveys - You will never know until you ask. Don’t wait until something breaks to try and fix it.
Follow Up - Make the call. Send an email. Customers want to know they’re on your mind, not just when it’s time to pay the invoice.
Gather Data - Data isn’t just for Fortune 500 companies any more. Businesses of all sizes are using this detailed information to grow.
Referral and Rewards
Happy customers make great brand ambassadors. Remember, word-of-mouth marketing is a powerful tool and should be used as part of your business strategy. Track where your customers are coming from and what they've head about you. Consider rewarding customers for testimonials or referrals. Showing gratitude to loyal customers can make them feel valued and increase their willingness to share your brand message.
Offer Referral Incentives - When a customer sends a new, potential customer you way say thank you with a gift card or referral payment.
Offer a Discount - Loyalty discounts go a long way when keeping a customer happy or closing a new deal.
Share Customer’s Success
When a customer is successful, that is a huge plus for your business. Sharing in customer successes not only show them that you care and want to celebrate with them. It can also attract new customers by showing them what they could be getting from you.
Recent studies show testimonials have the highest effectiveness rating of all content marketing methods - at almost 90%. Meaning the word of your current customers is the most effective way to attract new customers.
The Wrap Up
While new customers are valuable, retaining and strengthening the relationships you already have is the most efficient way to grow long-term.