“Whether you think you can or think you can’t—you’re right,” Henry Ford is credited with saying. In the case of actively expanding your customer base, no truer words were spoken. It is up to you to pursue new customers and expand your business, not wait for customers to beat a path to your literal door step or to your website.
There are three kinds of customers: existing ones, lost ones, and everyone who could become one. Most business managers cannot sit back and wait for “word of mouth” advertising to increase their customer base.
Obviously, maintaining current customers is a top priority. Coming in second is identifying and reacquiring lost customers. There are several good reasons your business should concentrate on being intentional about reacquiring lost customers. In a significant study of 53,000 customers who left a particular telecom company, Professor V. Kumar in an article for the Harvard Business Review provided several observations on the “why” companies should strive to regain customers who have left.
Past customers are already pre-qualified. “These people have demonstrated a need for the service (or product), making them far better prospects than random names on a cold-call list,” Kumar said. The efforts most companies have to make in order to gain awareness of their product or service is significant in both the time and money expended to obtain or convert a prospect to a customer. In all cases, having once been a customer, businesses should not have to re-educate or re-introduce the products or services being offered to a previous customer. That issue alone, should warrant or cost justify trying to win back past customers.
Here are some other bullet points you should consider when approaching past customers:
- You have an established history.
- They know your company culture.
- They have already had a sales connection.
- Your customer acquisition cost (CAC) is minimal.
Kumar stated, “Most important, recent technology…allows companies to draw on information about how people used their service the first time around to craft more-successful win-back offers and to identify and go after the most profitable defectors.” Identifying the history of product or service purchases should not be understated in their importance. Analyzing that history should give you the necessary insight into not only how the customer engaged with your company, but it could also give you a preview into why they left in the first place.
When it comes to being pro-active in finding first time customers, writer Jordan Glazier is adamant in suggesting “proactive engagement”. He suggests “integrating into the customer’s existing digital journey instead of waiting for a customer to visit your website then decide to make a purchase, your brand subtly surfaces relevant information or reminders within the customer’s normal online activity flow. This could take the form of helpful notifications or unobtrusive integrations from tools such as browser extensions that can provide value in real-time.” In effect, your business is going to the customer, as opposed to the customer coming to you.
Use current applications to your benefit: Glazier suggests “Many e-commerce platforms and CRM systems offer built-in tools for triggered notifications, personalized recommendations and even basic integrations with third party messaging tools.” Leverage them to gain new customers.
Use browser extensions: These tools can be used to be “seamlessly integrated into customers’ daily online shopping and financial decisions.
Form strategic relationships: There are many businesses who could complement your offerings, you just have to find them.
The benefits in seeking new customers by being pro-active will require an investment of time and money. But, by investing in active customer engagement, your business can significantly improve the visibility of your brand when your customer is the more susceptible to your marketing efforts. By being at the right place, at the right time, your firm will be able to show the potential customer what value add can happen when they establish a relationship with you. Think about seasonality. Determine the optimal time for your company to be pro-active in acquiring new customers.
All of this preliminary work is intended to help you identify which customers are worthy of contacting, but more so, you are establishing a priority with which to contact them. Typically, the lost customer who represents the largest dollar volume lose in sales over the shortest amount of time should be the one you contact first. It can also be very helpful to review any or all of the customer relationship management system (CRM) information you can gather, including the historical relationship and why the customer is no longer a customer.
All of these observations, research findings, and ultimate suggestions for an approach to get customers, are exceptional thought provokers, but in the final analysis, each business is unique. Not only in their business model, but in how they can and should go about in securing those clients or customers in order to grow their company.