Identifying Customers That Will Make Your Business Grow
Most people looking at this will think “Surely you want any customers you can get?” While this is true in some respects it isn’t always the case.
For example, let’s say you run a restaurant. You get 100 customers in a day and 80 of them have a 2-course meal and a drink but leave a tip and are happy. You then get 10 who pay for a 3-course meal but don’t leave a tip and subsequently give you a bad review online and demand their money back.
The final 10 customers could potentially be the worst- they may order a lot but also demand refunds on everything, snap at the waiting staff and generally be aggressive.
This is to serve as an illustration- how can you identify the customers that will benefit your business and make it grow while at the same time avoiding or deterring ones that may provide more challenges to you without providing a sufficient level of return?
Learn about your customer
Whether it’s through surveys, social media or customer feedback learning about your customers can be vital. It is also worth being open minded- for example, the cartoon series Adventure Time identified merchandise streams for both girls and boys, whereas previous Cartoon Network shows were cancelled because it was felt that this would not be profitable.
The “right” customer
In terms of sales, the ideal customer will-
- Purchase higher margin products.
- Pay full price for those products without attempting to negotiate discounts.
- Small numbers of larger orders rather than regular smaller orders.
- Rarely cancels or amends orders.
- Pays on time without having to be chased up.
- Doesn’t need extensive after-care.
These indicators should help you to identify your strongest customers and your weakest. This can be strange because your most regular ones may not necessarily be your most profitable. You also have to consider the effort or cost that goes into pursuing customers- if you are constantly having to ask to be paid is it worth chasing a few extra sales?
Keeping the “right” customer
The next thing to consider is how to keep customers. There are various ways you can do this- for example having close communication with regular customers and tailoring what you have to offer for them (for example if it is more convenient for them to take a delivery in the morning make sure you do that for them).
You also need to consider who you are marketing towards- if your target customer doesn’t use a social media platform then spending money on a social media marketing campaign won’t be effective. However, if your product is practical then a video explaining how to use a product and provide instructions can be very useful, especially if there is an offer connected with it (such as an online discount code).
For more information on how we can help you identify and retain your best customers contact Digi Toolbox now and we’ll be happy to discuss your needs in more detail.