Question #1 – WHY should you focus on marketing to existing customers?
Many business owners neglect their current customers or take them for granted. There is a certain level of apathy that occurs after the sale. I liken it to “the thrill of the hunt”. Once the hunt is over, so is the thrill. That is a big mistake!
In Jay Levinson’s classic book, Guerilla Marketing, he suggests that you should spend 60% of your time marketing to existing customers. Why would he suggest that we spend such an outrageous percentage of our time dealing with our existing customers rather than going after new ones? Because of lost opportunities:
- You lose up-sell opportunities: They may be in need of a more expensive solution but you would never know if you did not spend some time with them.
- You lose cross-sell opportunities: They may need additional services that you can provide.
- You lose down-sell opportunities: They may need to be moved into a less expensive solution. Talk about gaining a customer for life. If you were to go to a customer and tell them they are paying too much; imagine that!
- You lose referral and word-of-mouth marketing opportunities: Your current customers have already heard your sales spiel, gone through your entire process and still decided to turn over their hard earned money. You must be doing something right! Give them a reason to tell a friend or two about how great you are.
- You lose innovation opportunities: If you ask and listen, your current customers will provide you with a lifetime worth of new product and/or service ideas. They know what they want, all you have to do is listen and deliver.
Don’t neglect your current customers. Develop a plan to reach out on a regular basis.