Your Customer List Is Worth Its Weight in Diamonds
Your Customer List Is Worth Its Weight in Diamonds
The names and addresses of your very best customers — and I mean your very best customers — and all their past buying information can be worth their weight in diamonds, assuming you know what to do with that list. That’s why I find it shocking that many small companies don’t even keep a list of their customers at all. I think that’s a joke… and it’s not a very funny one.
Twenty-five years ago, when I first got started in business, I didn’t know much. I made a lot of mistakes, but I got one thing right: I had a little book I carried with me everywhere. I never let it out of my sight. It was always within three to five feet from me, always, and I called it “my Bible.” It was my list of customers, along with all their contact information — and I constantly called them up, trying to resell them things.
Keep a customer list. Segment and prioritize it, separating your best customers from all the rest, then do everything you can to make them many different offers, repeatedly. This sounds like common sense, and yet I promise you there’s nothing common about it, because most businesses don’t do it. Customers go where they’re invited, and they stay where they feel appreciated. Remember that. They enjoy the fact that you understand them and that you’re trying to serve them and help them.
So why is it that most business owners don’t even keep a customer list? Sadly, I think it stems from an arrogant attitude that goes, “My customers know where I am. If they want what I have, they know where to get it.” That attitude may have worked back when consumers didn’t have many choices about where to spend their money, but in today’s business world, it’s a recipe for failure. Some of your competitors are extremely aggressive, and so smart they’re dangerous.
Your job is to become a dangerous competitor yourself: to outfox all of your competitors, to think more strategically and be more aggressive with your marketing, to be more proactive and offensive.
Build your database. Segment it. Stay in touch with these people. Keep track of what they buy. Some customers gravitate to certain products and services, and some to others, so you can segment them by what they bought from you. A second way to segment your list is by how much they bought. Those who buy the most from you are your very best customers by default.
Once you’ve segmented out your best customers, make special offers to them. Always try to look for new ways to package whatever you sell. There’s tons of money in your customer list — a vast amount of potential financial energy. These people know you, like you, and trust you. People like to do business with people they’ve had good experiences with in the past, rather than try their luck with somebody new. Take advantage of that while you can.
Don’t ignore your list’s potential. People who’ve done business with you for a long time trust, like, and respect you, and they’ll buy more from you. They’re insatiable, so they want to buy more — but you’ve got to go out there and get it. If you do that with your customer list repeatedly and get really good at it, it’s almost like creating money out of thin air. Any time you need more money, just make an offer to your existing customers that’s similar to the one they’ve bought before, and Boom! There it is. You have the power to generate it that easily.
We’ve found that direct mailing through the postal service, even if you’re just inviting customers to go to your website, can have a significant impact on your profitability. This has been confirmed by other businesses. Even if you’re strictly an online business, this often works better than email follow-ups. Oh, you can still make a good profit that way, but you’re limiting yourself because of the huge problems with spamming and email clutter. People are so inundated with email that often, your messages don’t get through. A letter in the mail is warm, friendly, and personable; people take the time to open mail they receive from somebody they know. So as you look to communicate with your clients, consider adding direct mail to the mix.
And it’s critical to separate bad direct marketing from good direct marketing. We see people sending out cheesy one-page newsletters that look like they’ve been copied a thousand times, basically just asking people to come into the store or reminding them they’re still there. Often the newsletter doesn’t sell anything or offer any direct benefits. We see people mailing cheesy postcards that look like glorified business cards; they basically include the name of the store, their location, their hours, and maybe a little map. That’s it. Sure, they remind you that you haven’t been there in a while, that the business still exists… but there’s no offer there. There’s nothing to draw people in, and that’s where these businesses go wrong.
Nothing should ever go out of your business without a call to action on it. Always include an offer to get them to come back in. Even if you’re just communicating news and information to them, include a coupon or special offer. Do anything you can do to give people a reason to come in. There are all kinds of possible variations on that theme.
Now, it’s one thing to build a list of people’s names and mailing addresses, but what do you do with their buying information? One thing you can do is segment your list based on their purchase history. Let’s say you’ve got three groups of preferred customers. The A-list is people who have spent more than $1,000 with you. The B list is people who spent more than $500, and your C list is people who have spent more than $100.
Your segmentation may depend on your product, what your profit margins are, and how much you’re selling your products for. If you have products selling for as high as $5000 or $10,000, then the cutoff for your A-list might be rather high. To segment this information, you need some kind of point-of-sale software if you’re in the retail world, or mail order management software if you do business by mail or on the Internet. You’ve got to have a database system in place to track purchases, so that you know who your best customers are.
Having the raw data at your fingertips lets you target your list a lot more effectively. The idea, again, is to try to find the customers who buy the most often and for the most money. Both of those things can increase your bottom line. Of course, you want to keep acquiring new customers too, because that’s one basic way of increasing your profits. But when dealing with your existing customers, either have them order more often or get them to spend more money.
Article Source: http://EzineArticles.com/8250328