Marketing to existing customers – a powerful case study that will convince you to do more
By Flying Solo contributor Annette Welsford
Are you guilty of putting most of your marketing efforts into finding new customers? Here’s why you need to stop that now and change your focus.
I’m throwing down a challenge to all business owners.
I want you to stop for a moment, and analyse your marketing efforts to see how much of it is going into customer marketing.
Then, work out how much time is spent on existing customers.
Work out how much time you really devote to communicating regularly, giving them customer only special offers, and rewarding them for being loyal and referring you.
If the answer is less than 40% of your marketing budget and time, then I suggest that you’re wasting precious time and money.
Here’s a great example of why I advocate that customer marketing is even more important than prospect marketing.
The case study that will convince you
One of our clients spends 65% of their annual marketing budget on existing clients and has done for the past four years. As soon as a job is completed, the marketing system kicks in and significant effort is made to show that customer how appreciated they are:
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Within 24 hours of the work being completed, they’re asked for their confidential opinion of the quality of work and service received. If the customer is not 100% happy for any reason, they are contacted by phone and rectification made immediately.
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Within five days they are sent a little ‘thank you bag’ of thoughtful and useful gifts: a bottle of wine, a thank you letter and three referral cards which contain incentive offers to recommend the service to their friends.
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A week later they receive a further follow up, asking them to leave a review on TrueLocal, Facebook or Google.
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They continue to receive an email newsletter every month, filled with useful tips, client stories and gentle reminders to refer them on to their friends.
What does this company do?
They’re house painters.
At first, they were sceptical about trying this marketing strategy, because, let’s face it, there’s not much scope for repeat business. You don’t need your house painted very often, do you? So they couldn’t really see the merit of putting all this effort into customer follow up.
But, they decided to give it a go to see what would happen.
Here are the results.
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Since implementing this system four years ago, they’ve gone from 30% of new business coming from referrals – to a whopping 72%.
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They have received over 120 positive reviews and testimonials which have really helped with building credibility and authority.
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They are booked out 2-3 months in advance
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They’ve been able to cut their Google Adwords advertising budget by two thirds
The beauty of this type of marketing is that is nearly 100% automated, which means the owners of the business don’t need to remember to do it, and it frees up their week to devote all their efforts on revenue generating activities like quoting, managing the work, monitoring quality control and invoicing.
Key takeaways
Building a relationship with your existing customers can be far more profitable than chasing new customers. The cost of communicating with existing customers is a lot less, so your return on investment is higher. It’s also more personally rewarding to see your customers return again and again and refer you to others.
For me, this truly is the epitome of a successful business.
Do you currently have a system for making existing customers feel valued?
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Important
This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business, nor our Licensee take any responsibility for their action or any service they provide.
