There’s a funny thing about the process we use to grow small businesses (and even large ones). And that is that we start by generating new leads, then we market and sell to them, and some of them end up becoming new customers. And then we drop them, move on and work toward the next new customer.
It is absolutely critical that any business with a growth vision focus on generating new customer accounts — this much is certainly true. But what’s also true is these facts:
- The fastest way to generate new revenues is to sell more to the customers who already buy from you.
- The most cost-effective way to maintain your revenues is to make sure existing customers don’t leave, because it will cost you many times more to replace them than it will keep them.
These two facts are so often ignored that most companies experience significant customer loss rates and don’t even know it. After all, unless you sell on a subscription or retainer model, you may not even know if you lose them because you probably only track order activity and not a cumulative summary of customer sales or purchasing changes over the year.
That means you could be sitting on a revenue goldmine…one you can start to mine if you follow these five powerful steps to strategically re-engage them today:
Step 1: Analyze in Order to Understand
There’s no point in starting a new effort without first knowing where you stand. To do this, begin by exporting a list of all of your customer accounts from your CRM, accounting or other system. Now, you’ll need to look at revenue per account over the last two or three years. And if you can spare some staff time to help tabulate, make a note of each product or service category they purchased over the course of each year.
The result will be a map that shows you a few key things. First, you can see if some accounts are slowly tailing off their purchases from you, or if others are staying level but changing the mix of what they buy.
The last step in this process is to make a note of product or service categories that could be a fit for each account. For example, if your company offers cleaning services, building maintenance and security services, then a client who owns their own buildings could certainly use building maintenance — and if they aren’t, we need to make a note of that.
Step 2: Look for Patterns to Push
Now, you’re ready to find opportunities in the data. For example, you might find that many of your largest accounts are consistently not using you for an additional product or service that would be a good fit for them. Or you might determine that most customers spend far too little on a given category of support that should be upsold to generate more. Yet again, perhaps you’re delivering bits and pieces of a service offering that, if better organized and priced, could become a more profitable offering in the future.
These are all examples of patterns that can help shape your go-forward strategy. The first example would suggest that a strategic accounts program (where you dedicate sales staff and resources specifically to larger clients) would be a potentially great investment. The second might lead you to invest in marketing and account management activities that help introduce more clients to the under-utilized offering.
Step 3: Begin Re-Engaging Clients through Education
Now, we’ve got some solid data and a clear picture of our best options for moving the ball forward. It’s time to begin re-engaging! Before we start hard-selling, let’s begin by educating and communicating with clients regularly.
This might involve launching an eNewsletter or sending regular client updates and alerts to keep them informed. Or perhaps it’s time to launch a new blog with articles that are relevant to your customer base. And one of the best options to consider is to deliver workshops and educational or social events that allow customers to connect with you and mix and mingle with one another. Optimally, you’ll be engaged in all of these initiatives (and in an integrated manner) so that you can really ‘envelop’ clients in all that you have to offer.
Step 4: Build and Launch Tailored Offerings
So far, we’ve identified our key opportunities; identified where to focus; and started to successfully communicate with clients through a variety of educational and other channels of engagement. We are now ready for the next step – getting our tailored revenue generation strategy going.
To do this, first create the right offerings to attract and interest your existing customers. That might mean repackaging your range of services, or putting products together in a special packaged mix with a discount. Following our earlier example, you could create an offer specifically for customers who could use both building cleaning and facilities maintenance services but only use one or the other. For these accounts, consider offering a 10-20% discount when customers elect to have both services delivered together by your company.
Another scenario might involve creating a new service offering that repackages a series of individual services together. For example, if you run a law firm that focuses on employment law and you need to push past only serving clients once a dispute has begun (i.e. trial advocacy), then consider creating a new package that combines monthly advisory services with quarterly human resource process reviews and an annual audit of HR compliance with federal, state and local labor laws and regulations.
Step 5: Dedicate Resources to Customer Engagement
We’re making huge progress, and at this point you’re starting to see the impact of your customer communication and account-based sales efforts. Once you’ve seen enough traction to make you comfortable with further investment, it’s time to set resources aside specifically to turn this initial campaign into a permanent process.
This might involve adding customer-specific communications and programming to your permanent marketing action plan; hiring or dedicating a sales representative to retaining accounts and up-selling within the existing customer base; and refining the research process you mastered in steps one and two so that you can run it quarterly or even semi-monthly or monthly. This will allow you to sharpen the strategic focus of your business and prepare you for nearly any new market opportunity or direction that may emerge.
What these five strategic steps share in common is a recognition that revenue can be generated from a variety of sources, but almost always the most friction-free route to increasing sales is to better talk to, educate, engage and sell to people you already know — and who already know and have confidence in you, too.