Susan Oakes makes an interesting point on her site, M4B Marketing Blog, that has crossed my own mind on more than one occasion. In her article, “How Not To Retain Your Key Customers“, Susan questions why companies focus marketing on obtaining new customers instead of making offerings available to current, loyal customers. I have to say, she makes really valid points.
There are constant commercials day and night for service based companies offering the best promo packages for services such as cable television, cellular phone plans, etc. Why am I, as a loyal paying customer, never offered any fabulous package plans? Maybe if they offered their current customer base a really nice deal, they may even be willing to upgrade their plan.
Don’t get me wrong, it’s important to market your business to new customers but don’t forget about the ones you already have. Keep your current customers happy since they can always leave for the next better offer out there and you don’t want that to happen either.
“Why am I, as a loyal paying customer, never offered any fabulous package plans? ”
I feel the same way too, Steve! I believe this aspect must really be worked out by business owners because it’s really tempting to avail for a competing service provider who offers great packages for new customers which in my case, I would love to be loyal to a certain provider but it’s as if they don’t want me to be loyal to them either.
OOh bad thing that most did not realize that yet. I hope the soonest it will be!
This is especially important in economic downturns (like now). As Susan rightly points out, it takes you less effort and expense to sell more to your existing customers.
I think the problem most companies box themselves into is expecting ROI from marketing campaigns, and measuring it in terms of number of new customers.
Publicly-held companies often get themselves in this kind of situation, because they tell Wall Street analysts about the size of their customer base. Then Wall Street expects to see double digit growth.
That forces them on a treadmill of showing constant quarter-over-quarter growth in the customer base, and so they throw all their effort at trying to bring new customers on. Sometimes they even get sneaky and only report “new customer signups” or “new customer acquisition” numbers. They totally ignore the size of their existing base that way, by trying to focus the analysts’ attention narrowly on the growth in those brand new customers.
It’s a shame because the customer loses.
– Anita
Thanks for the mention of my article Amanda.
Anita you make a good point as I was reading an advertising magazine and there appears to be an emphasis on how many new accounts agencies have won. This is meant to show their success and seems to be the accepted way of promoting their business to potential clients. I am not sure how existing clients feel about this.