When it comes to the marketing and advertising of any business, there is one mistake that I see all too often — focusing on getting new customers. The truth is, businesses that focus too much on getting new customers, miss out on a huge opportunity that could truly allow them to scale in size in a short amount of time.
What I’m talking about is retention, keeping the customers a business already has and bringing them back to buy again, and again, and again!
There are SO many advantages to doing this;
- You don’t need to pay to advertise and acquire the person as a prospect and customer — you’ve already done that! That means any additional purchases they make in their lifetime gives you even more profit.
- Before a person becomes a customer, they must first be a prospect — somebody who knows you, knows what you do, and is interested. This is where marketing comes into play, to sort out all those that are not interested with all those that are. But guess what, past customers are already interested in your stuff!
- There are only so many people in the world — only so many people who would be interested in what you do — and even less people who are in a position to buy. That makes finding new business increasingly harder and more costly.
Getting customers again can also come in many forms;
- The returning customer can buy the same product (a hair cut for example)
- The returning customer could buy the same product that has since expired (hair conditioner for example)
- The returning customer could buy something similar to their last purchase (last time they bought a tent, today they’re buying a camping chair)
- Or a customer could simply be on a retention contract i.e. a subscription — where they pay monthly to receive something every month (a magazine, or something very similar each time but a bit different and unique too)
If you can alter your offering to include one or more of those models, your profit will start to sky rocket. Sure, you might have to expand your product range, build or bring in new products — but if you buy similar products that complement the original products — like the tent and camping chair — then you’ll get a great return.
And if you ever feel like you can’t expand your product range, or can’t think of what else to offer — then you can’t go too far wrong by offering more of the same! Anything that expires, or runs out after use or time, like hair conditioner, are great products to sell more of. Why not offer two of the same for half price off the second? Or even larger bulkier orders.
But these retention sales don’t have to happen at the store on the day of initial purchase. Capture the customers data — in particular their email and what they buy — and market to them accordingly. Many super markets have become great at this — sending personalised deals to people depending on what they’ve purchased before.
Sure, it’s a bit more work — but it has a greater return than trying to sell everything to somebody who might not be interested. After all, you wouldn’t try selling a wedding dress to a 19 year old boy.
If you run an ecommerce business, getting more out of a customer is really easy too in the form of upselling — Amazon, perhaps the best well known ecommerce biz, prompts buyers to buy similar products before they’ve even finished their purchase, and will then email offers on similar products in the weeks that follow!
There are so many options to allow any business to get more out of their existing customers. It’s entirely possible for a business to live off the same group of customers, forever, if they keep selling more to them. A great book I’d recommend anybody to read on this fascinating subject is Instant Repeat business by Brad Sugars.
There will nearly always be a need to keep getting new customers, over time — but far greater profits can be yielded if a business focuses more on getting past customers to buy again, than getting new customers through the door.