"Think Up-Side Down About Growing Your Business"
- Date: 2007-05-24 - Word Count: 450
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"Think Up-Side Down About Growing Your Business"
As many of you know I do quite a bit of public speaking on marketing. In many of my presentations I ask the group to think about growing your business. What are you going to do to grow your business this year? Then I give them a minute to think about it. Then I ask them to raise their hand if they thought about getting new customers. Every time, almost all of the hands go up.
Here's Make-You-Happy Customer Service Secret #20, When it comes to growing your business Think Up-Side Down.
If you are like most people, when you think about growing your business you think about getting new customers. The mega retailers spend millions of dollars each year trying to get new customers to come into their stores... and it continually amazes me that once they get me into their store the customer service is often so bad I won't ever go back.
I'm suggesting that when it comes to growing your business Think Up-Side-Down. In order to grow your business, rather than thinking about getting new customers first, think first about keeping your existing customers and getting them to buy more from you.
Let's look at the numbers. Assume that "Their Store" wants to grow by 10% this year. Let's further assume that their customer service is typical of most major retailers and 2 out of 10 customers decide they are going to take their business elsewhere because of the lousy service. Let's assume another 5% go somewhere else for a multitude of reasons. So they lose 25% of their business each year. So now, rather than growing by 10%, "Their Store" needs to grow by 35% to hit their target growth rate of 10%.
Now let's look at "Your Store". You also want to grow by 10%. But because you and everyone on your staff understands that customers give each and every one of you your paycheck, and your vacations, and your raises, and everything else you get; you simply do not lose customers due to poor customer service. You do lose about 5% of your customers each year for a variety of reasons - they move, they die, misunderstandings, whatever. So after you take into account losing customers, you need to grow 15% to reach your 10% growth rate.
So the morale of the story is... It's a lot easier to grow your business if you take care of your existing customers. When you think about growing your business Think Up-Side-Down. Think in this order:
1. What can I do to keep my existing customers?
2. What can I do to increase business with my existing customers?
and finally...
3. How can I get new customers?
As many of you know I do quite a bit of public speaking on marketing. In many of my presentations I ask the group to think about growing your business. What are you going to do to grow your business this year? Then I give them a minute to think about it. Then I ask them to raise their hand if they thought about getting new customers. Every time, almost all of the hands go up.
Here's Make-You-Happy Customer Service Secret #20, When it comes to growing your business Think Up-Side Down.
If you are like most people, when you think about growing your business you think about getting new customers. The mega retailers spend millions of dollars each year trying to get new customers to come into their stores... and it continually amazes me that once they get me into their store the customer service is often so bad I won't ever go back.
I'm suggesting that when it comes to growing your business Think Up-Side-Down. In order to grow your business, rather than thinking about getting new customers first, think first about keeping your existing customers and getting them to buy more from you.
Let's look at the numbers. Assume that "Their Store" wants to grow by 10% this year. Let's further assume that their customer service is typical of most major retailers and 2 out of 10 customers decide they are going to take their business elsewhere because of the lousy service. Let's assume another 5% go somewhere else for a multitude of reasons. So they lose 25% of their business each year. So now, rather than growing by 10%, "Their Store" needs to grow by 35% to hit their target growth rate of 10%.
Now let's look at "Your Store". You also want to grow by 10%. But because you and everyone on your staff understands that customers give each and every one of you your paycheck, and your vacations, and your raises, and everything else you get; you simply do not lose customers due to poor customer service. You do lose about 5% of your customers each year for a variety of reasons - they move, they die, misunderstandings, whatever. So after you take into account losing customers, you need to grow 15% to reach your 10% growth rate.
So the morale of the story is... It's a lot easier to grow your business if you take care of your existing customers. When you think about growing your business Think Up-Side-Down. Think in this order:
1. What can I do to keep my existing customers?
2. What can I do to increase business with my existing customers?
and finally...
3. How can I get new customers?
Related Tags: marketing, direct marketing, sales, direct mail, new clients, new customers, growing sales, growing profits
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