In almost every speech I give, one of the CEOs or business leaders in the audience is always dying to ask one burning question. That question is…
How do we get more profitability out of our existing customers, without having to always rely on lead gen to get us new customers?
While there can be many reasons causing this to happen, the primary reason is usually CHURN. Customers leave before they give the company the profitability (return on customer or CLV – Customer Lifetime Value) they want and possibly need from the customer. Sound familiar? It does to the majority of business leaders I talk to.
All customers have a life cycle where you break even after serving them for a certain period of time. At this point, you have covered your acquisition costs, onboarding costs, servicing costs, and are now ready to make some money. Only to find out that they leave soon after all these costs are covered (or often before these costs are covered), and so their profitability is low or non-existent. Do you have any customers that fit this profile? My bet is you do.
The answer is simple…GIVE THEM A REASON TO STAY.
Okay, this might seem like a pretty lame answer but bear with me on HOW you can do this and make more money doing it. Interested? I thought so. The critical question you want to answer is, “What can we do to either completely eliminate this or significantly improve it?”
This is what I call the “Tipping Point” for each customer. The point where you tip them over to profitability for an extended period of time.
I haven’t met a business leader yet who doesn’t want more of this for their company. Let me share with you some ways you can drive more profitability for each of your customers…quickly and for the long-term. Some of these you can do and see almost immediate results. Others will take some consistent effort, but it will pay off big time with each passing month.
And please, please, please, don’t forget the MOST IMPORTANT BENEFIT of focusing on this strategy. When your customers are super happy and sticking around with you for an extended period of time, THEY TELL OTHERS ABOUT YOU!! This is gold. This is the big kahuna. This is the brass ring. It is what you want to strive for with every customer…GETTING YOUR CUSTOMERS DOING YOUR MARKETING FOR YOU! Everyone wants more of this. They just don’t know how to make it happen. That’s why I wrote the book, “STOP Marketing…Your Customers Are Dying To Do It For YOU…How to become “REMARK”able™. More on that at the end. For now, let’s dive into some solutions for you.
1
KEEP YOUR PROMISES
While this might seem basic, it is one of the biggest issues I discover when I start talking to clients. They don’t realize just how few promises they keep. First, you have to know that even if you don’t use the actual word “promise,” your customer hears the word. For example, you might say that you hope to deliver the product this Friday. You think this is open-ended…your customer hears your promise to deliver it on Friday. When Friday comes and goes and no product, you broke your promise in the eyes of your customer. See how this works? There are explicit and implied promises…both carry the same weight to your customers. They think you made and broke a promise.
Often I will conduct a Promise Inventory™ with a client where we can specifically see what percentage of promises are being kept. Whether you do something this formal or not, find a way to track what promises are being made and then figure out how many are being kept. When you understand the number, change it. Improve it. Drive it as close to 100% as possible. The more promises you keep, the longer a customer will stay…guaranteed.
2
BLOW THEIR MIND WITH AN ABSOLUTELY MEMORABLE AND AWESOME EXPERIENCE
Okay, this might seem like a pretty lame answer but bear with me on HOW you can do this and make more money doing it. Interested? I thought so. The critical question you want to answer is, “What can we do to either completely eliminate this or significantly improve it?”
This is what I call the “Tipping Point” for each customer. The point where you tip them over to profitability for an extended period of time.
I haven’t met a business leader yet who doesn’t want more of this for their company. Let me share with you some ways you can drive more profitability for each of your customers…quickly and for the long-term. Some of these you can do and see almost immediate results. Others will take some consistent effort, but it will pay off big time with each passing month.
And please, please, please, don’t forget the MOST IMPORTANT BENEFIT of focusing on this strategy. When your customers are super happy and sticking around with you for an extended period of time, THEY TELL OTHERS ABOUT YOU!! This is gold. This is the big kahuna. This is the brass ring. It is what you want to strive for with every customer…GETTING YOUR CUSTOMERS DOING YOUR MARKETING FOR YOU! Everyone wants more of this. They just don’t know how to make it happen. That’s why I wrote the book, “STOP Marketing…Your Customers Are Dying To Do It For YOU…How to become “REMARK”able™. More on that at the end. For now, let’s dive into some solutions for you.
3
IMPROVE THEIR LIFE OR THEIR BUSINESS
The final way you can guarantee more profitability is to find specific and tangible ways to help your customers improve their own business or life…with or without your products. For example, let’s say you sell industrial shelving…not glamorous but a necessity for many enterprises. It sounds like a commodity, doesn’t it? And for most companies, it is a commodity. But it doesn’t have to be. Let’s say you developed a detailed plan for teaching your customers the best ways to get the most out of your shelving. What if you did an onsite analysis to determine if they even needed all the shelving they used? What if you showed them ways they could reduce the amount of shelving by improving inventory turns? What if you were able to show them ways to move the merchandise better so they could reduce their shelving costs rather than adding more shelving? Sure, you might sell them a little less, but they would stick with you for many, many years longer because they see you as helping them improve their business.
There are tons of examples of how this can work…in ANY business. Not sure…shoot me an email, and I can give you some hints on where to look. This is money in the bank. You do this, and they will be loyal to you for a very long time…probably until you stop helping them improve. Now you are no longer a commodity to them…you are a valued member of their team. Do this and watch your profitability increase with your customers.
What To Do Next...
Do a self-analysis on each of these three areas. Give yourself an honest grade on how well you think you do in each of these areas. The key is to be honest with yourself about it. If you suck, admit it and write down all the ways you think you suck. At least you have a starting point. The biggest thing I learned in consulting decades ago is that all consulting does is figure out the gap between where you are and where you want to be and eliminate it. Sounds easy…it isn’t. If you need help, get it. But whatever you do, be honest with where you are starting from. Identifying where you want to go is the easy part. But if you aren’t honest with where you are, you won’t fix the right issues.
If you want a recipe and playbook for how to do these things, buy my book and don’t just read it…execute it. It will give you a lot of guidance on how to make this happen. If you need more help, give me a shout and we can talk. But start with the book…it’s really a great guide. You can check it out below. In the meantime, hold a meeting with your leadership team and talk about these three areas. If your team is committed to improvement, you can identify many of the areas you need to change. It’s a great place to start!
My NEW Book
I referenced earlier that I have a new book. It is finally here. It will change your business…forever…guaranteed. Unfortunately, I can only give you the insights and direction in a brief article like this one. The book shows you exactly WHY you might want to be Customer Obsessed, HOW you can get there, and WHAT you need to do to execute. It’s transformative. I hope you get a chance to read it. But even more, I hope you take the plunge and actually execute it. It will definitely change your business…unlike anything you probably have ever done. Let’s do this…
