Never Forget Your Repeats
In this looming economic downturn, you would think that there is little you could do with your existing client base. Well think again. It is all about understanding your clients’ needs and meeting them exceeding their expectations. You have been in business for a while now with a list of existing, potential and dormant clients. What can you do to further the potential revenue from the list? Yes, you merge, purge and keep selling to your repeats.
Customer Retention vs Customer Acquisition
The cost of customer acquisition versus customer retention could reach as high as 700%, according to a report by Frederick Reichheld of Bain & Company as below:
- Acquiring a new customer can cost 6 to 7 times more than retaining an existing customer
- Over a 5 year period customer attrition rates could reach as high as 50% if databases are left dormant
- Businesses which boosted customer retention rates by as little as 5% saw increases in their profits ranging from 5% to a whopping 95%.
Regardless of whether your business nature is B2C or B2B, there are critical steps which you must execute whenever you run your direct marketing campaigns. This applies for both online and offline direct marketing campaigns. I shall skip the basics and we shall proceed to delve deeper into your databases.
Repeat Buyers – Make Them Sticky for Life
What at Repeat Buyers? They are your loyal customers who continue to use your services by virtue of the fact that you provide a specific product or service which they need, they are used to and that which is not available elsewhere. You may have exceed their expectations by a superior product or service, over delivered on your product value proposition or provided additional value add to them in a special way. You might also have given them privilege pricing which is unmatched elsewhere. Or your delievery channels are good match for their needs. In all aspects, you must have impressed your repeat clients well to keep them coming back for more. And there are ways you could further capitalize on them.
These repeat customers are what you might deem as Cash Cows as in the BCG Matrix, which require little maintenance cost, and consistently repeat revenue over time. You need to analyze the greatest “hook” your product or service have on them, which could be anything from the above stated.
Milk The Cash Cows, Build Relationships, Help Them To Help You
“Milk” them well by continuing to delivering your services over and above expectations. You may launch a special marketing campaign specific for loyal customers and package your most popular offerings using bundled pricing.
For B2C businesses, consider organizing “Loyalty Rewards Nights” and have them invite their friends and families, or have a quarterly “Bring a Buddy” Special Seminar. For B2B businesses, organize Business Partner’s Nite where business partners bring along their extended business associates for networking purposes or Golf Charity Outing for fostering relationships.
How ever your approach, you need to keep building relationships with this segment and provide them with genuine help in support of furthering Their business objectives. Essentially, you need to help them to help you grow your business. This way, good word-of-mouth & “testimonial” will bring you much more sustaining revenue over time.
Why Did You Stop Buying? – Reviving Your Dormant Customers
As for the Dormant Customers who have been one time buyers, run a “Survey Gift Pack” and ask them why they have not bought from you again. This is the customer segment which could well turn into your Cash Cows if you only listened to them. You might be surprised to find what they have to say about your product or service. Keep an open mind and take criticism constructively. Past experience is that further product development and refinement arise from customer feedback giving rise to new lease of life to the product life cycle.
Check out more good reads, visit Product Life Cycle Rejuvenation