A customer database is the most valuable part of your business, and here is why:
A database is simply a list with contact details of the customers and prospects you have dealt with over the lifetime of your business. Most companies have one in some form or other, but very few use it. They are so busy looking for new customers they have forgotten about the customers they already have.
So why is a customer database so valuable? Lets imagine that you started a business from scratch, no customers, not a single one. So you start an expensive advertising campaign to get new customers. While you build sales, every month you lose money on overheads and expenses while you work hard to win customers one at a time.
It is not unusual (without clever sales and marketing strategies), for a start-up business to take at least 12-18 months to consistently have enough customers buying your goods or services to break even (where income coming into the business will cover all purchases and expenses).
So as you can see, customers are your business – without them you just have a black hole where your money disappears never to be found again. In simplistic terms your existing customers could also be called the "goodwill" of the business.
When you have a customer database, what can you do with it?
Ah here is where the magic starts. Most companies spend a lot of money looking for new customers through expensive advertising and marketing. In a previous article I mentioned that an existing customer is 5-6 times more likely to buy from an offer you make than someone you approach who does not already know your business. The more often you are in contact with your customers the more times they are likely to buy from you. So lets look at some of the things you can do to get those old customers coming back, or your current customers coming back more often.
· Letting your customers know about new products you have that would interest them.
· Keeping them up to date on developments in your industry.
· Information on how to use your products better and in new ways.
· Specials and promotions you are running.
· Invitation to come back to your business with a special offer.
Note: Keep in mind that what you send needs to be relevant and of interest to your customer.
Simply by contacting your customers more regularly – you will do more business!!
Assembling your database:
As mentioned earlier a database is simply a list of customers and their contact details. This can be in a number of different forms:
· Customers in your accounts software
· A full CRM system
Or you might only have:
· Invoices with customer details on them
· Pile of business cards
· Customer details on competition forms
· Also quotes given to potential customers
To be useable your list needs to be on computer and with enough information to be able to contact your customer directly. This could be by post, fax, email, text or a phone call. Email is obviously the most cost effective as there is little to no cost.
If you don't currently have a database or it’s not on computer, no problem, just start collecting customer details. A very easy way start or increase your database is to run an in-store competition and ask customers to complete a simple form to be in to win. This can be entered onto an Excel Spreadsheet and BAM YOU HAVE YOUR DATABASE. If you do not have the time or are not a computer person, pay a good typist or secretarial service to enter your customer details. It won’t cost much and will pay you handsomely in extra sales in a very short time!!
I find most companies are in one of three situations:
1. Don’t have any customer database –
Action: Don’t waste another week, start collecting customer details now!
2. Have a database, but not using it -
Action: Start putting together something to send your database with your latest promotions and see what happens!
3. Regularly sending customers something, but not really getting the full benefits in sales -
Action: Start putting yourself in your customers shoes and give them content that will be relevant to their needs and situation, or some “killer offers” which they can’t resist!
A database is simply a list with contact details of the customers and prospects you have dealt with over the lifetime of your business. Most companies have one in some form or other, but very few use it. They are so busy looking for new customers they have forgotten about the customers they already have.
So why is a customer database so valuable? Lets imagine that you started a business from scratch, no customers, not a single one. So you start an expensive advertising campaign to get new customers. While you build sales, every month you lose money on overheads and expenses while you work hard to win customers one at a time.
It is not unusual (without clever sales and marketing strategies), for a start-up business to take at least 12-18 months to consistently have enough customers buying your goods or services to break even (where income coming into the business will cover all purchases and expenses).
So as you can see, customers are your business – without them you just have a black hole where your money disappears never to be found again. In simplistic terms your existing customers could also be called the "goodwill" of the business.
When you have a customer database, what can you do with it?
Ah here is where the magic starts. Most companies spend a lot of money looking for new customers through expensive advertising and marketing. In a previous article I mentioned that an existing customer is 5-6 times more likely to buy from an offer you make than someone you approach who does not already know your business. The more often you are in contact with your customers the more times they are likely to buy from you. So lets look at some of the things you can do to get those old customers coming back, or your current customers coming back more often.
· Letting your customers know about new products you have that would interest them.
· Keeping them up to date on developments in your industry.
· Information on how to use your products better and in new ways.
· Specials and promotions you are running.
· Invitation to come back to your business with a special offer.
Note: Keep in mind that what you send needs to be relevant and of interest to your customer.
Simply by contacting your customers more regularly – you will do more business!!
Assembling your database:
As mentioned earlier a database is simply a list of customers and their contact details. This can be in a number of different forms:
· Customers in your accounts software
· A full CRM system
Or you might only have:
· Invoices with customer details on them
· Pile of business cards
· Customer details on competition forms
· Also quotes given to potential customers
To be useable your list needs to be on computer and with enough information to be able to contact your customer directly. This could be by post, fax, email, text or a phone call. Email is obviously the most cost effective as there is little to no cost.
If you don't currently have a database or it’s not on computer, no problem, just start collecting customer details. A very easy way start or increase your database is to run an in-store competition and ask customers to complete a simple form to be in to win. This can be entered onto an Excel Spreadsheet and BAM YOU HAVE YOUR DATABASE. If you do not have the time or are not a computer person, pay a good typist or secretarial service to enter your customer details. It won’t cost much and will pay you handsomely in extra sales in a very short time!!
I find most companies are in one of three situations:
1. Don’t have any customer database –
Action: Don’t waste another week, start collecting customer details now!
2. Have a database, but not using it -
Action: Start putting together something to send your database with your latest promotions and see what happens!
3. Regularly sending customers something, but not really getting the full benefits in sales -
Action: Start putting yourself in your customers shoes and give them content that will be relevant to their needs and situation, or some “killer offers” which they can’t resist!
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