Customers represent a business’s most essential asset. No customers, no business. As obvious as this little saying may sound, businesses sometimes lose sight of it. Now may be a good time to refocus your business on customer acquisition and customer retention strategies. Here’s how.
Customer Acquisition Step 1: Identify Your Customers
Defining your target customers means identifying the specific wants and needs (“pain points”) of the consumers or businesses you believe will buy your product. If you serve consumers, consider adding in demographic information including age, gender, income, occupation, marital status (and family), hobbies, and interests. When targeting business customers, on the other hand, try to look at industry, revenue, location, and number of employees. Profiling is important because you don't want to invest a lot of money and time to attract the wrong customer.
To test these prospective customers, make contact to see if they have a need that your company solves. Too many businesses focus on what they want to offer customers, not what those customers actually want to buy. Here’s an exercise to help:
Complete the following sentence: “My company helps _________ who need _________.”
For example, “Sweet Dreams Therapy helps parents whose children don't sleep well.”
Then go out and offer your product or service for sale at the intended price. Do the customers you’ve identified actually buy it? If not, brainstorm with your team about adjacent problems that your business may be capable of solving. Sometimes the biggest customer need is not the most obvious, and you may need to pivot once you get more clarification on who the target market is and what they really need.
Customer Acquisition Step 2: Build Customer Awareness
To make yourself known to potential customers, you should consider showing up where their conversations are taking place. For instance, where are they looking for solutions to their problems online? Leveraging the following tools can help you build awareness:
- Search engines. Use keywords to search for customer problems that your company targets. For example, if your company repairs cars, search for phrases such as “Is my car totaled?” Then, comment on discussions happening on sites identified by your search.
- Alerts. Use web alerts to get notified when new content appears in your space or when someone mentions your company. When you get a ping, chime in.
- Industry magazines, blogs, podcasts, or forums. Inject yourself into the most popular and active communities in your industry, with expert advice and other useful commentary.
- Social media. Search social sites to find relevant business pages. For instance, if you are a florist, engage in conversations that discuss holidays, weddings, and other special occasions. From your own social media pages, follow, like, comment, and share – just don’t use your comments for sales pitches.
Customer Acquisition Step 3: Market to Your ‘Suspects’
Marketing as described above also gets people who feel the pain your business solves (suspects) to identify themselves. Sales activities then present those people (now prospects) with a specific solution to turn them into customers. In other words, prospects are suspects who have “raised their hand” and said in some way, such as responding to an ad, that they're interested.
Your list of suspects is likely large, but directly selling to each of them will take too much time and resources. Instead, the goal of this step toward customer acquisition is to get them to self-select. Here are tactics suited to different market segments:
- Advertising. Trade journals and online publications can serve as affordable options for reaching suspects for a reasonable amount of money.
- Direct email. Consider buying curated email lists from a broker. Use a marketing email system that tracks who opens emails and clicks through to your website. Then, follow-up by marketing to them (more on this in Step 4).
- Search Engine Marketing (SEM) and Search Engine Optimization (SEO). One of the best things about paid search (SEM) is that your company can set its own budget and narrowly define the targets who will be shown your ads as they search for related products and services. SEO is free of fees but requires writing quality content on your website, and lacing it with keywords to drive traffic from search engines.
- Trade shows. If you have a large enough budget, you might want to exhibit at a few trade shows. Or, it can be almost as effective not to exhibit, but instead to walk your industry's trade show and collect cards from attendees.
Customer Acquisition Step 4: Market to Your Prospects
Step 3 should help you naturally cull a prospect list from your suspect list. This list should be much smaller because prospects have already identified themselves as being interested in your specific solution to their problem.
This also means your prospect list requires a different set of marketing tools and tactics. You should touch each of these prospects individually and as consistently as possible through a variety of media. You want to be there when they need you. Here are some options:
- Direct sales. Call or email your prospects to check the status of their need and your solution to it. Generally, there's nothing wrong with being up front; just don't become annoying or pushy. What's the difference? Keep track of the last time you contacted them and when they called you. Don't call more than twice to every unanswered call from them. If these two calls aren't returned, you can call every few weeks for a month or so. No answer or reply? Then you no longer have a real prospect, and you need to move on to other interested names on the list.
- Referrals. The right customer for you may not be the prospect themselves, but someone they know. Stay in front of them so they will be thinking of you the next time an associate of theirs can use your services. You can always ask for referrals at the right time, like during a business lunch.
- Direct email or postal mail. Send prospects industry information or articles of interest so they can continue to see you as the expert who can solve their problems.
Customer Retention: Make It a Focus
Some businesses never grow because as they bring new customers through the front door, current ones are leaving out the back door. Many companies invest heavily in attracting prospects, but then neglect to focus on holding onto them after the first sale. This is evident when comparing the highly paid sales team a company might have to its poorly supported customer experience team.
While most business owners would concede that customer acquisition is more expensive than customer retention, they do not typically invest their resources this way and don’t retain customers. The best tip for customer retention strategies is to provide excellent, personalized service, while making it easy for them to do business with you through convenient communications channels, flexible payment programs, and other amenities. Here are additional tips:
- Understand your customer. Ask them why they do business with you and not with a competitor, as input for setting your business priorities.
- Hire customer experience staff. Most things consumers buy are commodities available from a wide variety of vendors. Successful companies dedicate resources to retaining customers by emphasizing customer experience.
- Stay in touch. Maintain frequent “check in” communications (manually or electronic) to get feedback on product satisfaction, mention new products, and explore other areas of opportunity.
The Bottom Line
Customer acquisition and customer retention should be a business’s bread and butter. Refocus on your customers by taking deliberate steps to identify the right customers for your products and services, build their awareness of your offerings, engage with them in their own environment, and deliver excellent, personalized customer service. There is no shortcut, but if you're consistent in your efforts, your customer base and sales pipeline should always be robust.
A version of this article was originally published on November 12, 2014.
Photo: Getty Images
