I recently had a client say to me: "I don't need to do anything else for my existing customers; I need to find new customers."
Dumbfounded, I couldn't wrap my head around this. Didn't she realize that it costs more to attract new customers than it does getting existing customers to buy more? In her defense, she was already working several other "channels" with blog posts, newsletters, email promotions and even an active podcast. She WAS communicating and building relationships.
But I am right...right?
Actually, you could argue that advertising and promotional activities aren't just about converting that first time customer. They are also about supporting the brand in current customer relationships. And current customers can typically enjoy the same discounts as prospective customers. However, communicating to existing customers without listening to what their actions tell you is no more efficient than continuing to look only for new customers- wherever they may be.
So where is the flaw in my client's thinking? Data. What she, and many other businesses, both large and small, has failed to do is look at the data collected on those existing customers. As a business, you must realize that you are unique, either by product location or a combination of many things. Even franchised concepts can serve a largely different demographic (which in turn could demand a unique product mix or price point) simply based on their location. You may also find that the way you communicate with current customers is not as effective as you thought.
Collecting data doesn't have to be a daunting task, but once you do collect it, it is essential to get it all in one place and actually look at it. "One place" can be as simple as utilizing a pivot table within an MS Excel document, to engagements with data analytics professionals. Either way, you've got to start somewhere.
Key places to look for data:
- Loyalty Programs
- Social Media
- Online (Google Analytics)
- Demographic Research
If you are just starting to collect data, it's important to track each marketing channel so that you can not only determine response rates for a particular promotion, but also tie responses to the items purchased, the sales revenue and buying patterns. Use unique offer codes and ask for customer feedback if in direct contact during the sales process. When considering social media insight, be sure to compare and contrast it with what you are seeing from other marketing feedback specific to your business to get the true story.
Things you should you look for in your global data:
- Patterns in the buying habits of your customers for discounting only when necessary
- Potential efficiencies in marketing expenditures and product inventory
- Processes that could be improved
- Any risks or instances of fraud
An important thing to remember is that your data collection process should be unobtrusive enough so your customers don't feel harassed in the process. You should also be aware of Privacy Laws that impact how you manage your customer's information. In the end, a solid data collection and analysis strategy will tell you things about your business and your customers that you very likely didn't know, or validate what you suspected. If managed correctly, a long term relationship with data is one neither of you will regret.