How much is a new customer worth today?

When you own your own business every customer is important.  Businesses spend thousands of dollars trying to attract customers and hopefully keep them all.  There is an old saying- that says a happy customers tells a friend, but an unhappy customer will tell the world-average 10 people! And the scary thought about that quote, its pre social media.

Depending on your type of business you will need to estimate the short and long term value of each new customer.  You may be surprised, for a small ticket item like coffee, it has a large life time value. Let’s think about how addictive coffee is, how predictable peoples patterns are and you have a formula to capture a life long customers for your coffee shop.  In 2010,  there was a marketing study done by kissmeterics that calculated  that the life time value of a Starbucks customers $14,099!  If you knew each new customer you attract is worth $14,000-would that change how you viewed them or treated them? Something to think about.

How can you estimate this for your business:

Hire a professional marketing  and research company

Search on line for similar businesses and see what information is available to give you a guide

Do you own research: look at your monthly and annual records.  Look for patterns.  What is your average sale? Does that sale change by day of week or seasonally?  By what percentage is your business growing? What marketing channels are you using and what are the results coming in?

Check with town and state Census data to learn on average how many people enter the area each year and leave.  Those estimates will give you an idea of your growth curve or potential attrition each year

Now that you have an idea of what each of those new customers are potentially worth to you, what happens if they are unhappy.

Apps on our phones allow unhappy customers to become instant thought leaders or business crushers.  Yelp, Twitter, SnapChat, Facebook, Instagram and more, allow instant feedback-good or bad.

I don’t want to scare you but it’s important to think about  this- If a customers has an unsatisfactory experience at your business and they have a robust social network, how many people are viewing their comments-100 people, 1000 people, 100,000 people.  Frightening!

For many businesses this is a frustrating thing and something they need to handle.  In many cases, you cant “fix it” but you can respond quickly.

The most important thing when handling an unhappy customer: do you very best to handle the situation in the moment.  If that is not possible, keep a close eye on your social media.  An unhappy customer will try to warn others and most likely will tag you in their posts.  This is your chance to respond promptly and make an attempt to answer the concern.  Reaching out directly with an apology about their unsatisfactory experience, offering a solution to the situation and being open to please them is KEY.  Others who may see their unhappy post will also see that you responded and replied with earnest to rectify things.  That is what matters-a reasonable person understands that things can happen and its how you react afterwords that speaks more about the character and quality of your business. As difficult as it is to hear negative things about your business, it may make you aware of a growing staff problem or faulty product.  That feedback, allows you to take action quickly to make your business stronger and better for tomorrow’s customer.

And as we just learned, tomorrow’s customer is worth a lot more!

 

 

How can you promote your business for free?

If you are a new business or a small business,  you are looking for ways to start marketing and promoting your business for free.

Things that may go through your head ” I want to just test the market first before I go big”, ” my trading area is so small it’s going to be referrals” or ” I just spent my life savings getting this off the ground I don’t have much coming in yet”.

Not to fear– you already have the most important and effective advertising medium….YOU! No one is more knowledgeable or passionate about your business than you.

Let’s use what you have and get started.
Here are three things you can do this week to increase the exposure for your business that is free (or almost free).* side note- these ideas will require your time, focus and attention and in some cases,  your product or service.

#1 Social Media 

Is your business properly represented on Facebook, Twitter, Instagram, Periscope? Do that first.  Social media has become a very powerful tool for communication, referrals and promotion. We will spend more time on each of these and their benefits in upcoming posts.  However, for today make sure you have all the basic business information correctly listed. Name, web address, street address,  current photo’s of staff, merchandise or events.  Social media channels give you an opportunity to build a relationship and have regular communication with people who are interested in your business.  Get on line and start that conversation!

#2 Charity and Community Involvement

This is a great way to support the organizations and groups that are important to you, while gaining exposure for your business.  Offer to provide prizes for a raffle event,  Donate your time at an event, and wear your company gear. If your business has the space, invite them to have an event in your business.  By donating your time and services you are not only doing a good thing for an organization you care about but you are showcasing your business to like minded people AKA- potential new customers.

If the event or organization is large enough,  it might be worth reaching out to local media outlets for a PSA.  A PSA is a public service announcement.  All media outlets are obligated to promote and support community events, sending them a PSA doesn’t guarantee free press or free air time. However, if they have an interest in the event and the space,  you might get free advertising. Below is a basic guideline to writing a PSA, be sure to have all the important pieces of information included but be brief.  Now who gets it? Here is a sample list of titles:  email your PSA  to: Public service director, program director, editor, community relationships manager.

How to Write a PSA Script

  1. Capture the attention of your audience by making the ad relevant to them at the beginning of the announcement. Ask questions or make brief points that will help the audience identify with the cause of your organization or event. For example, “Have you ever known anyone who has been the victim of a drunk driving accident? A friend, a relative, an old high school acquaintance?”
  2. List the essential information listeners or viewers need to know. Think about who should attend or get involved, what it’s about, where it’s happening or where the business is located, when and why. Give directions or a point of reference for an event location. For example, “located next to Wal-Mart on the strip.”
  3. Use emotion to encourage the audience to get involved. Choose words that describe how the audience, or those benefiting from the charitable event, will feel as a result of their participation. For example, “Your decision to quit smoking won’t only leave you feeling free and in control, but your family will benefit from having you in their lives for many more years.”
  4. Call the audience to action. Do you want them to make a monetary contribution, attend an event or volunteer their time? Maybe you want the audience to quit smoking or teach their children to look both ways before crossing the street. Make it clear what you expect the audience to do after listening to your message.
  5. Include contact information, such as a name and phone number, or a website address where people can get more information. Repeat information that’s difficult to remember, such as the phone number or website address.

Read more : http://www.ehow.com/how_4927633_write-psa-script.html

And finally

#3 Networking

You are the most enthusiastic person to talk about your business- go talk to people.  Tell everyone you meet-spread the word.  There are formal organizations you can join like a  BNI group.  These are groups of businesses, usually grouped by geography. They meet regularly to share leads, ideas and support each other.  Some groups do ask for a joining fee, but you will have the opportunity to formally and informally talk about your business on several occasions.

You can find more information on http://www.bni.com/

I wish you luck and success with your business. I hope these tips have given you some good ideas. Get started today to see new customers tomorrow!

If you have any specific questions, you can email me here.  Thanks for stopping by and spending time with me.