A business needs customers. Maximizing business performance means a steady stream of new shoppers, supported by a system that converts them into loyal and lasting customers.
Research by Harvard Business Review shows that increasing customer retention rates by 5% increases profits by 25% to 95%. Add to this that 82% of companies believe that retention is cheaper than acquisition and the gains become clear.
Whether you sell online or through a brick-and-mortar storefront, here are seven ways to build your customer base.
1. Know your customer
Who buys your product or service? What are their interests? Which platforms do they use to research and shop? How do they rate your service and products? It's easier to connect with strong prospects if you know your target audience, where they spend time, and what they want — in product and experience.
Knowing the age, geographic location, and the purchasing frequency and preferences of your customer base allows you to segment your audience and customize your message. A tailored message will help you to frame marketing and cross-selling campaigns that resonate with your ideal customer.
Setting up Google Analytics (GA) and tapping into the wealth of knowledge it can provide on visitors to your site is a great starting point. Conduct customer surveys in-store, on your website, or via email or social campaigns to help the information gathering process.
2. Deliver excellent customer service
Research by Nextiva found how much customer service matters. (Spoiler – it’s a lot!) They found that one-third of consumers say they would consider changing companies after a single bad service experience, and 47% did switch within the last year. The average American tells 15 people after a poor customer experience. If a business resolves issues the first time they occur, they could prevent 67% of churn.
Many companies fail to deliver consistent customer service and miss out on profitable relationships that drive business performance. Finding new prospects is valuable, but long-term and loyal customers are worth more. Customers have high expectations; not living up to them can send them on their way.
3. Systematize customer feedback
Shoppers trust reviews and testimonials over a company's marketing. According to recent online statistics, nine out of 10 consumers read customer reviews before making a purchase, and 75% say they trust online reviews as much as a personal recommendation.
Reviews establish your credibility and demonstrate your care and customer service. Even negative reviews can have a positive effect on sales if you resolve them well — and promptly.
4. Build partnerships
One pillar of long-term success is nurturing relationships. That applies to customers, staff, and even other businesses. Teaming up with companies that offer complementary services can benefit everyone in your network.
A jewelry company who sells through a local clothing boutique is a brick-and-mortar example. Customers don't have to make two stops to get the accessories they need to style-up an outfit. The same can be done online. Enhance your product offering by teaming up with complementary providers.
Strong relationships create advocates who promote your business for you.
5. Build your email list
Don't let prospects leave your website without giving them a reason to share their email address with you. You can ask them to complete a quick survey, offer a discount or promotion, provide a free newsletter, or host webinars providing information they will value.
Email isn't new to digital marketing, but it continues to perform. Fifty-nine percent of consumers say email marketing influences their buying choices. A curated email list and strategic email marketing campaigns will keep your customers engaged. Email marketing platforms such as Mailchimp distribute, track, and manage your email marketing campaigns — and keep subscriber lists clean and up-to-date.
6. Give first, ask second
Whether it's handing out samples in person or providing insight and knowledge online, a generous approach allows the customer to get familiar with your company and products without the pressure of a sales situation.
Free content, discounts, and samples begin building the customer relationship and lowers their resistance to engaging.
7. Track customer success metrics
Customer success metrics are quantitative ways to track and improve your customer base.
Here are three essential customer metrics.
Customers enjoy feeling they have a voice because they know where your marketing, onboarding, or product delivery process can improve. Ask customers what they think and apply their feedback.
The customer churn rate is the percentage of customers that stopped using your company's product or service during a defined period.
Monthly recurring revenue
How much money do your customers spend on your products and services each month? The answer reveals your monthly recurring revenue (MRR). To track the success of upsells and upgrades, expansion MRR is the amount of additional revenue you're generating from customers on top of their monthly subscriptions.
Customers drive business performance
In conclusion, whether you're a solo entrepreneur or represent a small company, business is ultimately human to human. When we take care of our relationships with customers, they take care of us.
As you build new pathways for customers to find you, think of their concerns and how your business can make their lives better. Underlying this should be rigorous attention to data.