Generally speaking, there are only three ways to increase your revenue, no matter how big or small the company is:
- Increase the number of customers you have
- Increase your price
- Sell more to your existing customers
Basically, it boils down to convincing your customers to buy more or to buy at a higher price, or getting new customers to try your product.
Many small businesses make the mistake of focusing on customer acquisition only but totally forget about customer retention. It’s almost as if they believe that once they can get a customer to patronize them the first time, they don’t need to focus on moving the relationship with the customer anymore.
I am going to share with you why that thinking is detrimental to your revenue growth. I’ll also show you why customer communication is important and why you should focus more on keeping your customers than going hunting for more. There are many reasons it pays to never let customers go (in fact, it pays to retain inactive customers), and some of them include:
It is Cheaper
It costs less to keep a customer than to fish for one. Though the latter might be more rewarding, it could cost as much as seven times what it would cost to keep a loyal customer. No matter what your marketing and lead generation strategies are, it’s going to cost money to create a marketing campaign that will get leads and move them through the sales funnel to customer level.
It is Easier
It is much easier to sell to existing customers who know your value and trust you than to start creating trust with a new set of customers who have a lot of resistance to new products and startups.
It Helps to Show Customers You Care
There is no better way to show customers you care than putting a lot of effort in customer retention strategies. Customer retention methods help improve your customer communication, and that in turn helps your relationship with your customers. A better relationship with customers will lead to more sales more often.
If you are using an app like Xeno, it’s much easier to retain your customers and show them you care by using the power of live response, which helps retain inactive customers (because they are important too) as well as the active ones, thereby ensuring customer communication is 100%.
Focus More on Covering the Holes in Your Bucket Rather than Pouring More Water
If you have holes in your bucket, what do you do first? Pour more water? I don’t think so. Yet many businesspeople make this mistake in their businesses. They don’t have a good system to retain customers, but they go after more customers and wonder why their buckets never get filled.
You don’t want to make that mistake. Work first on retaining the ones you have first, then you can go out to get more customers to fill your bucket. Good luck!