"ON YOUR OWN"- COLUMN 4-
Diamonds in Your Backyard
In our last column, I said we'd be looking at one of the best sources for customers for any business. As a voracious reader of business books, I've come across a term for a wonderful concept- the term is the title of this column, "Diamonds in Your Backyard". Very simply, it refers to the tendency business people have to look for business all over the place, while neglecting one of the best sources that is right under their nose- their existing and past customer base. One of the reasons my business has grown and flourished is because of these "diamonds". Let's look at how you can mine your diamonds..
According to figures in many books on selling, it costs 5 times as much to sell to a new customer as it does to sell to an existing customer. There are a variety of reasons for this, but if this is true, then you can be up to 5 times as efficient with your marketing dollars if you concentrate on your existing customers. To do this, though, you need to know who your existing and past customers are. Your first step should be the development of a mailing list.
BUILDING A MAILING LIST
If you are serious about building your business, you must begin compiling a mailing list TODAY. Go through old records- old invoices, billing records, datebooks- wherever you keep the names and addresses of people you've sold to in the past. Create a database in your computer- it doesn't need to be anything fancy. For the past 7 years, I've been using Microsoft Works for my list management. You'll need name, addresses, phone numbers, and some fields to keep track of what they've purchased in the past and the dates of those purchases. This list is going to be worth it's weight in gold to you, so back it up, and keep one copy out of the office in a safe location. If my office burnt down, my business will continue as long as I can get to my mailing lists.
It may help to break your lists out by category, and by geographic area. In my business, I deal with schools and libraries thoughout the tri-state area. I have separate lists for schools on Long Island, New York schools by county outside of Long Island, etc. I do the same for libraries. When I market, I can get very specific on my offer by breaking out my mailing by these different customer categories. It's a level of flexibility that big companies can't always take advantage of, and it's what Jay Levinson refers to as "Guerrilla Marketing".
Once you've built your mailing lists, you need to stay in touch with them. I've read varying estimates of how often you should keep in touch with your lists, but I feel a minimum of 5 or 6 times a year is necessary to keep you in their minds. This can be done in a variety of ways- you don't have to feel like you should be simply sending them sales letters. Newsletters are a useful way of keeping in touch with your customers, and are a great way of giving valuable information while keeping your name in front of them. Newsletters seem to be very popular with certain industries- for example, financial planners often make good use of them. If you promote a newsletter, make sure it IS a newsletter. Don't call it a newsletter if you're simply pitching them on your product or service the whole time- that will make you look dishonest, and will lose you customers.
You may also consider sending postcards to your customers, if you've got a special offer that you wish to promote. With desktop publishing so readily available, you can create wonderful pieces and have them in your customers hands in a matter of days. I've used postcards several times, and while you are limited in the amount of information you can convey, they are still a good way to stay in touch with your customers.
Many businesses are in the habit of sending all of their clients a Christmas or holiday card. While the sentiment is nice, if all you're planning on doing is sending them a pre-printed card, save your money. It will get hung up on the wall with the other cards the company gets, and be forgotten. I'd rather send them a card with a special "Thank You" offer inside- maybe a 2-for-1 deal good for January. A company that I have dealt with for many years always includes a free gift offer in their holday mailing- for any order placed during the month of December, they will include a free gift from their catalog. Since they are excellent at keeping customer records, they will select something you don't already have, and something that fits in with your needs. It's a nice way for them to stimulate sales around the holidays, and it also makes you feel special- they've gone to the trouble of selecting something for you.
Regardless of the offer, you need to find ways to make your existing customers- and past customers- feel special. Often I will mail to my existing customers before my general mailing lists, to give them first shot at the best dates for the programs they wish to book. I always let them know in the letters that I've done so- it lets them know that I value them, and to show that, I'm giving them special treatment.
I know you cannot run a business solely on past and current customers- markets change, customers move, people die- your existing customer base will never stay as big as you would like it to be. You WILL need to prospect for new customers. But in doing so, don't neglect the people who have gotten you this far- your past and current customers. Keep in touch with them- OFTEN. See you next time!
Any questions, comments, etc can be sent to me at firstname.lastname@example.org.