Increasing market share and the bottom line is what all businesses look to improve. But the reason they aren’t making enough sales is due to the failure to answer two basic questions:
What is the best and most cost-effective way to attract customers?
What is the best way to keep those customers buying?
They’re simple questions, but the failure of most businesses is that they don’t ask themselves those questions often enough.
Every business must have a marketing budget which must include the money needed to spend for advertising. But advertising alone simply isn’t enough to attract customers. If you run a business, you need to be visible and positioned in the marketplace, both of which are not necessarily due to advertising. Many start out thinking that advertising is what pulls in customers. But a far better, more cost effective way to draw customers is by creating trust in the customer’s mind. Ads are mere words on paper, but you, the business owner, is a living breathing entity and if you don’t project the idea that you are there to help the customer solve his problems, the customer will skip over your product in favor of another.
A great product does not always sell. Many business people focus on creating that perfect product they believe everyone will want. Unfortunately, they leave out the customer’s needs entirely. That wonderful brand name product you spent millions of dollars developing isn’t what he wants. The cost-effective way is to produce a product that the customer needs, can afford and does the job he wants it to. Making improvements can come later as you’ll have a customer base whom you can ask for suggestions. If there are no customers to give you feedback, you’ll never know how good your product actually is.
Still another mistake many make is focusing on profits, rather than providing good value which is a better marker on how well you are selling than the figures written down in a ledger. Your cost-effectiveness can be measured over the long-term by how much the customer values your business. If he or she keeps coming back to buy from you, you have lowered the costs associated with your product or service.
What you do and how you keep your customer buying is an integral part of marketing. Forgotten customers are a valuable resource as they’ve bought from you and likely will buy again. But too many marketers focus exclusively on getting new customers by spending more advertising dollars than are necessary. Of course, you need customers and you want to increase market share to improve the bottom line. But neglecting the existing customer base is a big mistake as they can cost you hundreds of dollars of future revenue.
Keeping the customer means giving him exceptional service. And much of that service comes from maintaining contact with the customer. While the majority of a marketing budget should go toward advertising for new clients, some must be allocated to keep existing customers.
If you really want to increase the bottom line and grab a bigger piece of market share, you need to focus on both the front-end selling to new customers and the back-end selling you make to existing customers.
It’s the businessman and woman who knows the answer to the two key questions who is likely to stay in business while others flounder with mediocre sales as they spend all their marketing dollars chasing new prospects.