One of the most overlooked sources of profitable revenue growth is your company's current customer base. While many business owners beat the drum espousing the importance of current customers, I have found that very few companies have a comprehensive current customer growth strategy that is communicated, monitored, and enthusiastically embraced by the entire organization.
In December, we reviewed the first steps for getting more sales out of your current customers -- ranking your customers by sales and profitability and developing your Best Customer Profile. Once you have identified your best customers, you need to teach your employees to know who they are and to provide them with techniques and tools to uncover customer preferences and make every customer interaction count!
Five Techniques for Teaching Your Employees to "Grow" Your Current Customers
#1: Broadcast your Top Customers throughout the Organization
The first critical step to involving your team in growing currents customer is to share the Best Customer Profile. Be sure to include your Best Customer Profile as a primary part of your new employee orientation. We all talk with new employees about procedures, polices, company history and specific job duties. But rarely, if ever, do we let them know who are current best customers are, why they are important, and the profile characteristics of our best customers. These customers are the lifeblood of the organization and need to be top of mind with everyone. On an ongoing basis, broadcast your top customers throughout the organization. Everyone from the receptionist to the CFO should receive a monthly "best customer case study" that provides an overview of one of your best customers, why the company is important, what its current status is and the value of that customer.
#2: Build Your Customer Preference Profile
The Customer Preference Profile was by far the most powerful tool we used to get more revenue from current clients. To build your Customer Preference Profile meet with your team and make a list of data elements you would like to capture for each customer. Many business owners have asked me, "What type of information should we collect?" Beyond the obvious contact and demographic information, you want to capture information that will help you and your team sell more to your best customers. For our concierge companies, we want to capture customers' dining, entertainment preferences, gift preferences, etc. If you are selling business to business, you may want to know your clients' primary corporate objectives, upcoming strategic projects, budget season planning dates, key competitors, etc. The ultimate goal is to have your team complete a Customer Preference Profile on each customer over time.
#3: Train Your Employees to Be Detectives
You have developed your Customer Preference Profile -- which addresses the "what" you should capture and the "why" -- to sell more to your current customers. Now comes the "how" Our primary training objective is to teach our employees to think of themselves as detectives -- to decipher the needs of current best customers and to sleuth out new best customer prospects. Provide your employees with key questions they can use in in daily phone and e-mail exchanges, in face-to-face interactions, in online surveys, etc., that will assist them in completing the Customer Preference Profile. Get all employees involved in thank-you notes, surveys, and visiting client sites.
#4 Keep Tabs on Your Customers with the Customer Activity Report
To help employees uncover new opportunities we developed and use the Customer Activity Report. This report provides a snapshot view of the specifics of the relationship history with each customer, the number of transactions we had, its average transaction value, its last purchase date, the age of the customer, and its active status. This tool is particularly helpful in recapturing possible customer defectors and assists in timing marketing communications to the customer's buying patterns.
#5: Increase "Share of Customer"
Probably the most valuable tool after the Customer Preference Profile is the Share of Customer Report. This tool was one of the key drivers behind our efforts to sell more to our current customers. The objective here is to move your customers across your products and services lines and capture 100% share of your existing customers' business.
The first step is to make a grid that lists all your company's products and services across the top and the annual potential customer spend value of each product line. The last column is the "total spend" value if a customer purchases all of your products and services.
Next, list your top customers down the left side of the grid. Indicate which customers are buying which products and the customers' annual spend. If the total annual spend value per customer for all of your products is $2500 per year and your current customer is spending $1000 on a few product lines, you have the opportunity to capture an additional $1500 per year from this existing customer! And this is a cost effective sales opportunity as you will not incur customer acquisition expenses.
These five techniques have truly transformed my business. The focus on the value and potential of current customers across the organization helps us to maintain stellar customer and client retention rates, to cut sales expenses, and to achieve the easiest path to new revenue growth!
Through Mary Naylor's business instincts and perpetual drive, VIPDesk has grown since 1997 into the leading corporate concierge service with over 20 million users. Leveraging her customer relationship marketing expertise, Mary continues to build strategic business alliances and to develop "next generation" loyalty products for the company's blue-chip client roster.