Make Your Business Thrive!

 

Entrepreneurs and small businesses alike are facing unprecedented economic challenges. . . but within every challenge is a hidden opportunity.

Dark times breed innovation from our brightest entrepreneurs. In fact, more millionaires were created during the Great Depression than during any other era.

So how can you turn the recession into an opportunity for your business to thrive?

How do you turn a deserted island into a relaxing oasis?

Over the next several days, I will be writing about how you can make your business thrive by…

   1. Wowing your customers
   2. Employing effective marketing strategies
   3. Concentrating on ROI
   4. Creating efficiencies
   5. Staying positive and getting creative

Face it. The economy stinks right now and there are a lot of key indicators that show the economy will stay this way for awhile.

As an entrepreneur and small business owner, you have a choice.

One – - You could keep doing what you’ve always done. You could hunker down, hide from the world, and wait out the storm. It won’t be a comfortable ride and you won’t turn a big profit. . .but you could survive.

Or Two – - You could admit that whatever you were doing last year is not going to cut it today. You can adapt your strategies and create a new battle plan specifically to address what is happening right now. If you do. . .you won’t just survive. . .you’ll THRIVE.

Surviving through the current economic crisis is a lot like being shipwrecked on a deserted island. You can battle the elements and struggle to survive. . .or you can adapt to the island lifestyle, kick off your shoes, and enjoy a much deserved tropical vacation!

But your island detour can only turn into a vacation if you are equipped with a kick-butt survival, I mean thrival kit.

Here are the tools you need in your “Down Economy Thriving Kit”:

• Loyal customers
• Economical marketing strategies
• Efficient processes
• Positive attitude and creativity

Let’s begin exploring the first tool in your Ultimate Thriving Kit – - Loyal Customers

Loyal customers are essential to the long-term survival and profitability of your company but many business owners do very little to proactively manage this precious resource. You don’t have to make the same mistake.

One critical factor in generating customer loyalty is to find the right customer to begin with. You can do this by defining your ideal customer through:

• Demographics (size, industry)
• Psychographics (behaviors, attitudes)
• Buying behaviors and Patterns
• ROI (cost to revenue for acquiring and maintaining that customer)

Recruit those customers who are most likely to be loyal. Take some time to evaluate your customer base and look at how you have acquired your most loyal customers. Are there any patterns you can duplicate? Ask your existing customers to help you bring in new business, like them.

Strengthen your relationships with quality customers through ongoing communications, value add, involvement in your business.

Part of finding the right customers means avoiding or getting rid of the wrong customers. So don’t be afraid to “fire” your worst customers. You can fire them simply by not spending marketing and service efforts on them. Segment them into a “poor” customer group and avoid targeting your marketing efforts at them.

So now that you’ve found the “right” customers get to know them better.

• Ask your customers what they want.
• Make sure all your strategic decisions focus on the real voice of your customer not what you perceive it to be.
• Explain major changes in your organization so uncertainty does not turn into fear. Fear turns into rumors. Rumors turn into negative brand images.

A key factor in getting to know your customers is maintaining (clean) data about them. Before you assume that your customer data is fine, consider this:

• At least 10% of customer and prospect data has critical errors.
• Poor data issues compound (more than doubles) every 12-18 months if nothing is done.
• Data quality best practices can increase revenue by 66%. (Sirius Decisions)

You need a system in place to ensure that your data is accurate. This will allow you to collect and gain sight of a 360 degree view of your customers. How did they learn about you? What offers have they been presented? What offer closed the deal? Once you have a view of your customers you can group them according to patterns and market to them with a more personalized, effective message.

Everyone talks a lot about customer retention because it is so critical and cost effective. If you don’t know what your customer acquisition costs are, this should be a top priority of yours. You should be looking at all your marketing cost for acquiring a customer and their lifetime value.

What percent of your customers do you think are currently considering leaving you for a competitor? Are you in danger of losing clients/customers?

The truth is a whopping 60% of your clients/customers might be thinking of switching to a competitor! And as the competitive environment continues to intensify, it’s likely that other firms are marketing more aggressively to your own clients and, as this data suggests, a good portion of your clients may be open to having these conversations with your competitors.

Keep Your Customers!

Customer attrition is a real threat right now. Customers cut budgets by:

• Reducing purchase frequency (eating out, going to the movies).
• Switching to lower cost providers.
• Canceling service entirely.

You need to prove to them that you’re worth their money, even in a time of budget cuts. The little things can go a long way. Take time to thank your customers for sticking by you in the tough times.

Reduce Attrition by keeping an eye on profits!

• Customers (both B2B and B2C) are looking for bargains.
• Everyone wants to save money – this means your customers.
• Create deals that bring them in the door and value that keeps them coming back. 
• Maintain a markup ratio that allows you to remain competitive and drive sales
• Offer discounts to your top 10% of customers

Reduce Attrition by Providing Great Service!
“87% of respondents said good customer service influenced the decision to do business with a company again.” (source: CRM Magazine)

What are you doing to ensure your customer service is bringing back your customers time and time again? Be customer service centric. Focus on providing GREAT customer service. In today’s economy, customer service is often the key differentiator in a competitive market.
 
Empower your staff to solve customer service issues. Make sure your staff understand the importance of the customer experience and is empowered to take action to improve it. Allow them to write self-help articles for customers based on common questions, etc.

Maintain high levels of employee satisfaction. This has a trickle down effect that improves customer service. As part of this, you must communicate well with your employees. Uncertainty can be very de-motivating.

Be positive. Your customer facing staff can make or break retention. A negative staff creates a negative impression on your customers.

So, now you have:

• found the right customers
• learned all you can about them
• and, discussed ways to keep them.

These are all necessary to survive. But, we’re not here to just survive. We want to thrive. So, let’s explore how to leverage loyal customers to THRIVE by selling them more.

• Thank Them
• Market To Them
• Segment Them
• Incentivize Them
  • 22% average Incremental sales growth
  • 82% of customers report a rewards program has a positive, direct affect on their attitude towards the company and its products

In my next post, we will take a look at the second tool in our “Thrival Kit”: Economical Marketing Strategies!

As always, we love to hear your comments. Please post a response and let us know what you intend to do differently with your loyal customers.

Enjoy your day!

Ken

Related posts:

1. Get Positive!
2. Effective Processes
3. Economical Marketing Strategies