Better Business Idea #17
Do You Know Who Your Customers Are?
© 1998 by Michael C. Gray
September 29, 1998
This seems like such a marketing fundamental that it shouldn't be necessary to ask. But the last time you did business with almost anybody, did they make an effort to get your name, address, telephone number, and email address? (At the movies? At the hardware store?)
Do you have such a system in place for your business? Do you keep track of the sales made to each customer? What type of products do they like? What details do you know about them to profile them and group them with similar customers for promotions?
Who are your best customers? Most of us do know this, but there might be some surprises in gathering this information. What profit is a customer generating? Is he or she a booster for your business? How much does it cost to serve this customer? Is he or she a drain of your resources and energy to be referred elsewhere?
For a "killer" list of details you should know about your customers to get a competitive advantage, see Harvey MacKay's Swim With The Sharks. What if your competitors are getting this information and you aren't? Don't you think they might have a competitive advantage?
After years of "shotgun" advertising, Lucky, Safeway and other grocery stores have initiated "rewards card" programs to identify and learn about the buying preferences of their customers, and also to encourage customers to shop at their stores more often. How can you use this idea in your business?
Most of us agree that it costs three to ten times more to acquire a new customer than to keep and please an existing customer, yet we expend most of our marketing resources on acquiring new customers. Isn't it time to rethink this strategy to make our marketing more effective, and improve our profitability to boot?
When you ask most business owners what their most valuable business asset is, they will think about the assets on their financial balance sheet. But the most valuable business asset isn't on the balance sheet. It's the customer list.
You do have one, don't you?
For new articles about how to improve your business, subscribe to our newsletter, Michael Gray, CPA's Tax & Business Insight!
Home Business Building Blog Introduction Seven Habits Business Improvement Book Reviews Need Help? Links