For the first 90 days of this year, I'm each week posting the "single most important thing you need to know" about 13 essential aspects of sales and marketing, because "1 percent of activity creates 99 percent of success."
Here are my columns so far:
- The Single Most Essential Rule About Pricing
- The Best Sales and Networking Trick, Bar None
- The 10-Minute Website Tweak That Increases Sales
- How to Win Customer Loyalty in 10 Seconds
- The Essence of Market Targeting in 10 Short Words
- This Trick Triples Cold Email Response Rates
- The 1 Thing You Need to Know About Closing a Sale
- The 1 Question To Ask Every Marketing Job Candidate
I'll now turn to a more general question: where should you focus your sales and marketing efforts?
First, some quick background. Over the past decade or so, I've had dozens of companies ask how to hone their marketing and sales plans. Surprisingly, the advice is almost always: re-target your sales and marketing towards the customers most likely to buy.
Sounds obvious, right? Well, yes, but a fair number of quite intelligent businesspeople have no idea of how to prioritize sales leads or lead generation efforts. Much of the time, they focus on acquiring brand new customers, which is expensive and difficult.
I could cite numerous examples of research on why people buy and when (perhaps a future column?) but in this column I'll just cut to the chase and list out your potential customers from "most likely to buy" to "least likely to buy."
1. Customer evangelists
They consider your brand or product as an essential element of their personal identity. Common examples would be Apple (about a decade ago) and Tesla (today, at least for now.) They will buy from you because failing to buy from you would be a denial of who they've defined themselves to be.
2. Satisfied customers
They are generally happy with your product and are finding it useful. They're not nearly as committed to your brand or product as the evangelists, but they trust you (as evidenced by buying from you in the past) and they will therefore buy from you in the future.
3. Former (but satisfied) customers
They remember your brand or product fondly but for some reason or another (perhaps a change in their company or a new job) are no longer numbered among your customer base. They'll buy from you because they don't see a good reason to buy from somebody else.
4. Your evangelists' peers
They hear your evangelists singing your praises or see them wearing your swag and can see how happy your evangelists are with your product or brand. Unless they think your evangelists have a screw loose, they'll consider you a good choice, should they want something similar.
5. Unhappy customers
You probably think that unhappy customers are MORE difficult to sell than raw sales leads, but that's not actually the case. Obviously, you must diagnose and fix the problem to their satisfaction, but there's an added benefit. When you turn an unhappy customer into a happy customer, they will often become an evangelist!
A friend of mine recently took over the handling of his company's Yelp account, followed up on all the complaints, fixed the problem, got all the bad reviews amended, and then discovered those formerly unhappy customers referring new business. True story.
6. Your customer's peers
This type of customer is a big leap down from the five types above because now we're in the realm of new customer acquisition. Due to "social proof" people with the same job title in the same industry will tend to buy what their peers have bought. A CIO, for instance, is more likely to consider buying from you if she knows that other CIOs whom she respects (or at least knows of) have also bought from you. (Hint: testimonials!)
7. Brand new customers
And finally we come to totally new customers in new markets. These potentials have (maybe) heard of your brand or product but they don't know anybody who uses them. To develop this type of customer, your marketing and sales materials must carry the entire burden of creating trust and the perception of value. This is very challenging, which is why it's can be so hard to bootstrap a new business in an entirely new industry or segment.
The General Rule
Assuming you already have some customers, it's always easier to sell more to an existing (or former) customer than it is to make an initial sale to a brand new customer.
So, your first priority in sales and marketing should be 1) selling more to your existing customer base and 2) turning satisfied customers into evangelists (type 1 above) who will then spread the word to their peers (type 4 above).
How best to do that? Stay tuned, because next week I'll rank all sales lead generation methods from best to worst--thereby creating a roadmap for how to best reach the easiest-to-sell customers.