It is so much easier to sell more to your existing customers than to sell to new customers
Ignoring your existing customers is an expensive mistake. It costs five to FIFTY times more to generate a new customer from the “cold” market, than to get further sales or referrals from the customers you already have.
After all, your customers have already raised their hand and demonstrated their interest in your product or service. They’ve committed themselves to you emotionally and financially. They KNOW you, they TRUST you and they’ve paid money to you. What a HOT list!
Your existing customers are therefore very important, valuable and significant to you … because they’re the MOST likely people to buy from you again! So you need to do everything possible to ensure that your customers will continue to buy from you rather than from your competition.
If someone buys from you twice a year right now, it’s unlikely to take a lot more time, effort, manpower or money to get them to buy three times. Yet just one more purchase a year per customer could translate into enormous increases in profitability for your business.
1. Communicate personally with your customers
As soon as your customers have done business with you, their minds will immediately revert to the next issue they have to deal with … and you drift out of their mind. The more continuously and personally you communicate with your customers by phone or letter to maintain a strong positive relationship, the more they’ll feel you really care. As long as each of your communications has a purpose, is customer focused and conveys something of value to your customers it’s more likely that you’ll get the next sale, and the next, and the next. The resulting higher repeat business and referral levels will also make your business vastly stronger, virtually isolating it from the ravages of the economy and price-cutting competitors.
2. Preferred customer events
It’s easy to forget that your previous customers are the people most likely to buy from you again. Your customers want to be recognised as special, so you can use regular or periodic special events not only as a way of attracting and converting new customers but also to reward and acknowledge your existing customers as very special people. You can repay their loyalty by giving them unique advantages and benefits, giving them advance access to new, improved or niche products or services, or by giving them better choice, preferential pricing or free bonuses. Everybody loves it, it can be lots of fun and it’s usually very profitable … because it results in nothing less than more of your existing customers buying more of your products and services more often.
3. Programme Your Customers
Few businesses ever think in terms of selling their customers a long-term package of their products or services. Yet if your customers can benefit from your product or service on a recurring or ongoing basis, it’s easy to sell them them a six-month, twelve month, two year or longer programme where they either pay you a flat-fee in advance, or commit to purchase the same product or service from you a given number of times over a specified period, or at certain key intervals, at a pre-agreed preferential price. This means that instead of living from job to job and passively waiting for your customer to call you, you have on-going business with zero additional sales and marketing costs. This will give you nothing less than guaranteed future cash flow that you couldn’t stop if you wanted to.
4. Lock In Sales In Advance
So many businesses simply “react” to their customers needs and fail to set up on-going relationships. Instead of just passively waiting for the next customer to call, many of your customers are likely to sign up for a programme where you supply your product or service automatically at pre-determined intervals. It can be such an easy process to make the transition from selling single product or service transactions to ongoing, long-term lifetime contracts or service level agreements that make it hard for your customers to switch to your competitors. As long as you educate your customers to understand the reasons why you’re doing it, and how it results in savings that allow you pass the benefit on to them, you can frequently lock in repeat sales for years.
5. Develop back-end products and services
Most businesses spend all their time, effort, manpower and money trying to attract new customers, when for a tiny fraction of that investment you can get your existing customers to buy more products or services from you. When you do, they will often be at higher margins than before because you no longer have the same selling costs. There are probably dozens of products or services that you could supply as a back end offering that represent the “icing on the cake” that can multiply your profit margin many times. These can be anything from extensions of your main products and services to complimentary products and services that other people sell.
6. Bounce Back Offers
One of the great misconceptions in selling is that once someone has purchased, they should be left alone. Countless studies have shown that customers who have just bought from you are in “buying mode,” and that if they’re happy with your service, they are THE most likely prospects to buy again. A “bounce back” is an offer that comes in a timely manner right after the first sale … bouncing back with another product or service that’ll serve the customer’s needs. It’s one of the easiest, least expensive ways of generating a re-order or further sale and can generate significant additional income from the hottest of buyers with virtually no extra marketing cost. If you don’t ask your customers to buy again, they may go to your competitor, so this is also a perfect opportunity to create an on-going relationship and bond with your customer.
7. Loyalty Programs
Frequency builder programs motivate your customers to purchase from you over and over again so that you don’t have to work so hard to develop repeat business. By offering special extras and incentives to return and purchase more often, you build your customers’ loyalty. Programs can take many forms that include point accumulation programs, sticker or punch card programs, communication programs, “preferred customer” discounts and sales, special “members-only” offers and rewards and gift certificates or rebates based on expenditure. These programs bring you closer to your customers, strengthen your position in the marketplace, insulate you from price competition and help you get a larger slice of the cake. They also allow you to collect data on your individual customers which will cement your customer relationships by targeting special offers to their specific needs.
8. Price inducements for frequency
A customer who buys from you 100 times is many times more valuable than someone who buys only once … so it makes sense to motivate your customers to buy from you initially, then reward those who buy the most for their frequency of repurchase. The possibilities are endless. You can offer lower prices for pre-payment or for long-term or “till further notice” commitments or you can offer contract prices to high volume customers. You can give price incentives, bonuses, premiums, upgrades, rebates or credits to customers who guarantee or commit to buy a certain number of times or a minimum volume in a year. This will breed recurring purchase habits and build a perpetual stream of contact, income and loyalty.
9. Endorse other products or services
One of your most valuable assets, if you’ve done a good job, is the extraordinary trust, respect and goodwill that you build up over the years with your customers. They have needs that go far beyond what you can offer, which means they’re often looking for recommendations from someone they can trust. This provides you with an enormous opportunity to offer other people’s carefully selected products or services to your customers through endorsement. This will normally result in vastly greater response than if your customers were approached “cold” … without your endorsement or recommendation. It requires very little time or effort to endorse other products or services to your customers. Done correctly it can’t help but produce an enormous flow of new business for both you and the companies you endorse.
10. A mid-job, next-job recommendation
You should always be alert for the next sales opportunity. As long as your customers are happy with your product or service, your easiest sales will be to your current customers. They already know you, they’ve invested emotionally in you, they’ve taken a risk and they’ve bought from you. They know whether or not you’ve delivered what you promise. If you have, you’ll earn their loyalty. Even so, your customers don’t know everything you can do to help them … unless you tell them. Once you’re half way through your current job you should know how else you can help your customer, so it’s a good idea to propose another way in which you can help them, then start selling them the next job. This is the “mid-job, next-job” recommendation.
11. Create a perpetual relationship
Customers frequently hold back on their initial transaction because they want to be sure that you value and appreciate them during and after the sale. If you don’t look at your relationship as perpetual, you may never see that customer again. But if you invest in that relationship and always do and suggest what’s right for your customer, regardless of your own needs, you’ll discover just how responsive and profitable your customer relationships can become. Because your customers’ needs are likely to change and grow over time, your customer can be a continual and predictable source of ongoing revenue and referrals. By constantly communicating personally with each customer you can compel them to re-purchase again and again. The possibilities are endless and the results can be extraordinary.
12. Customer Newsletters
Regular newsletters can be a very effective method of keeping in touch with your customers and building closer and stronger relationships. You can use them to educate your customers to the full extent of your products and services and how they add value; to generate more frequent referrals and repeat business; to demonstrate that you really care; to consistently remind your customers why they’ve made the right decision to deal with you. An effective newsletter has a purpose, is focused on the interests of your customers and conveys information of value to them. People respond to this positively because it keeps them informed, acknowledges them and makes them feel valued and important … and the right newsletter will result in significantly higher repeat business.
13. License Your Successful Concepts
Many of your non-competing colleagues will willingly pay to learn your ideas if you’ve developed processes, systems, methods of doing business or technologies that work better than normal, add value in unique ways or allow you to operate more efficiently, productively or cost-effectively. You can make a small fortune by consulting with them, transferring your knowledge, licensing, renting or leasing your concepts or by entering into joint ventures for a flat fee, an annual usage fee, or a percentage of their revenues. They’ll benefit from your expertise and efforts without having to invest the time and expense themselves. This can transform your ideas, methods and processes into one of the most lucrative profit centres imaginable, that’ll generate real, significant and recurring cash flow for you year after year, substantially increasing your profits.
Other Strategies to generate greater transaction frequency include:
- Creating an Energised Workplace