Business Growth Strageties Your 4 Part Marketing Plan

Your marketing plan should contain these four strategies for growing your business. They are presented here by degree of difficulty and cost, from low to high. The priority you assign to each strategy will be determined by the unique needs of your individual business situation, products or services.

1. Strategy to Sell Existing Customers

Selling to the very people pre-disposed to buying from you again gives your business the best return on investment (ROI). As obvious as this would seem, many business owners get so wrapped up getting new customers they overlook such a great source of revenue growth.

The key is to get your customers to buy more frequently or buy in larger quantity. Better still, set a modest goal for both categories. A goal of just7% increase in frequency and 5% increase in average order size yields a 12% increase in revenue just to the existing customer base

Now a paradox: If you want to increase sales to your existing customers–fire your worst clients and customers. They take up way to much time and energy and rob you of the opportunity to sell to your best clients. In one extreme case Tom Choate, president of Air Systems Technology in Avon, MA, “fired 40% of his customer list!” As Tom puts it, it was not easy and it took a lot of resolve but his company came out better for it.

2. A Strategy to Recover Lost Customers and Clients

There’s not enough space here to list out all the reasons and percentages why customers stop buying from you. However, research shows that 63% of your customers who stop buying from you are recoverable. Barring any past payment issues or serious unresolved disputes there are a lot of people who may still be pre-disposed to do business with you.

The number one reason given in surveys of why a customer leaves; they don’t feel you care about them or have lost contact over time. Now, add that to the fact they get more attention from your competitors who their new business and you can understand how they drift away.

So, call former customers, write them a letter and offer a special deal for renewing the relationship. I can’t say how many people you’ll get back, but the cost is still a lot less that what it costs you to get a new customers.

3. A Strategy for Referrals

Taking a closer look this is actually a strategy with two parts. The firs part is having a plan or plans to actually get referrals from your satisfied customers and clients. The old fashioned ways is still by far the most effective way, first do what is necessary to earn referrals, then, ask for them. You can ask for them directly, in a letter or survey, or offer a premium or special deal. The key is to ask, thank them in some way, and follow up quickly.

The second part is a lot easier; start the sales process with a call, a letter, and special offer. You have the advantage of an introduction from someone who is a person of influence. You have a targeted prospect that is pre-qualified and receptive to your marketing message. You’re several steps ahead in the selling cycle, but don’t assume the sale is automatic.

Do your normal great job and get paid twice. You now have two satisfied clients/customers giving you referrals, not one.

4. A Strategy for Getting New Customers/Clients

Regardless of the systems you have in place for recruiting and closing new business this is still the most expensive way to grow your business, but necessary. There are as many ways to get new business as there are businesses. A high risk way of getting new business; use one method to get seventy five new customers. The low risk way, use seventy five different ways to get one client with each.

Of course the answer depends on you, your company and the means you choose to employ to get new business. What you should know before your start spending a dime on new business is the lifetime value, or residual net wroth, of a customer/client. Once you know what a customer/client is worth you then you can decide how much to spend getting a new ones.

In conclusion my friend, Bob Conroy of Mantis Design Associates stresses that for these strategies of be effective, “you must think in terms of campaigns” and not as a single ad, web site, or offer. A great point, now that’s why it’s called a marketing plan.

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