Wednesday, January 27, 2010

Starting a Business? Why You Need to Know Customer Management

Getting customers in the door is the first obstacle to building a new business. Historically, entrepreneurs were primarily concerned with the customers in front of them at the moment and seeking out new ones, but they did little to court their established customer base.

As evidenced by the frequent shopper cards we now collect everywhere from Subway to the grocery store, big business has finally realized the error of their ways.

In small business, managing your customer base is even more important. Consumers who are already familiar with your company and product benefit the business in multiple ways.

Targeted Marketing and Repeat Business

First, they are excellent candidates for targeted marketing. If the business is set up to collect information such as what they usually buy, when they usually shop, and even personal details like their birthday, anniversary, and other hobbies, you can use that information to encourage further sales from current clients.

Every visit from a potential customer is an opportunity to gather data that will help you cater your marketing efforts to your customer base. It is estimated that the cost of sales for standing customers is a fraction, perhaps 10%, of the cost of finding new customers. Why not take advantage?

Referrals

Referrals are also a strong opportunity with your current customers. Offer a premium or discount to those who refer your company, and be sure to thank anyone who does. People like to be in the know, and if you offer a good product or service, people will be happy to refer you...as long as they think of it. Sending targeted emails or postcards to your current client list encouraging referrals can be very effective, especially if there is something in it for them.

Gather and Manage Customer Data

The key to successfully managing your customer base is in gathering useful data. Every website should include a way to capture leads, such as an opt-in form where interested individuals can submit at least their email address to join your mailing list.

Many brick-and-mortar stores request a street address from each customer as well. You can create a birthday club or frequent shopper promotion to collect relevant data as well. The trick is to ask for data that will actually help the marketing plan. If you won't be calling anyone on the phone, don't ask for phone numbers.

Email addresses are a given, because sending out newsletters or promotions via email is extremely cost-effective. Mailing addresses are good, too, if you might send coupons or other promotional materials out.

Respect Customer Privacy

Personal information is a bit more tricky -- people are sensitive about their privacy. But, if you have a legitimate reason for collecting the data, such as a freebie on a birthday or the like, most people are happy to give it up.

Also consider developing a survey or hosting a contest or sweepstakes to collect additional information. Gyms often do this, then offer a three-day pass to everyone who enters...it not only gets potential clients in the door but gets them motivated to join up!

Collect data every chance you get -- signup sheets at shows, business cards at networking events, website opt-ins, and follow up those leads with interesting newsletters or promotions. Always tell your customers how their data will be used, and whether you will share your mailing list with others.

The world of social networking has opened up even more customer management opportunities. The more of your customer base that is your friend or fan on Facebook or following you on Twitter, the more they are reminded that your business exists.

It takes time to keep after your clients, yes, but they are the reason you are in business at all. Managing your customer base is an essential portion of marketing, and can be the difference between struggle and prosperity.

By : K._MacKillop

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