Let me ask you a question. When was the last time you reached out to a customer who had already done business with you? As small business owners, we’re almost always thinking about the next customer. Who can we get through the door? Who can we get to call? Who can we get to click, book, buy, or sign up?
Don’t get me wrong, new customers matter; but before you spend another dollar trying to get somebody new through the door, it might be worth checking on the people who have already walked through it. Because sometimes the next opportunity for your business isn’t a new customer at all.
New Customers Can Be Expensive
Think about everything you do to attract a new customer. You might run ads, post on social media, attend networking events, send emails, make calls, hand out business cards, ask for referrals, and follow up with leads. And after doing all of that, there’s still no guarantee that person will actually buy.
Research cited by Harvard Business Review found that acquiring a new customer can cost anywhere from 5 to 25 times more than retaining an existing customer, depending on the industry and study. Here’s the part that should really get a small business owner’s attention: increasing customer retention by just 5% can potentially increase profits by 25% to 95%. Now, I’m not suggesting you stop looking for new customers; I’m suggesting that while you’re looking for new business, you shouldn’t forget about the business you’ve already earned.
You Already Understand Why This Works
Think about your own habits for a minute. How often do you try a completely new restaurant versus going back to the place where you already know what you like? What about your barber or stylist? Your mechanic? Your favorite coffee shop? The person you call when something breaks in your house?
Once somebody does a good job and earns our trust, most of us don’t wake up the next morning looking for their replacement. Your customers probably aren’t that different. If you delivered a good product, provided a good service, and gave them a good experience, you’ve already done some of the hardest work. You’ve earned their trust. Now you have to give them a reason to come back.
Don’t Treat Your Customer List Like a History Book
Here’s something I want small business owners to think differently about: Your customer list isn’t just a record of who bought from you. It’s a list of people who have already said yes to your business at least once and that’s valuable.
Yet a lot of businesses spend most of their marketing energy trying to convince strangers to buy while barely communicating with people who have already purchased from them.
Take a look at your own customer list.
- Who haven’t you heard from in a while?
- Who bought from you six months ago? A year ago?
- Who might need that service again?
- Who bought one thing from you but may not know about everything else you offer?
There could be revenue sitting in that list that you’re overlooking simply because you haven’t reached back out.
Here’s Your Assignment: Find 5–10 Customers
I’m going to give you something simple you can actually do this week. Pull up your customer list and find 5–10 customers who haven’t purchased from you recently. Not 100. Not everybody you’ve ever done business with.
Start with five and reach out. By all means, please don’t make the first sentence, “BUY SOMETHING!” Reconnect like a person.
You could tell them about a new product. Let them know about a service they haven’t used before. Send a seasonal reminder. Offer them something special as a returning customer. Ask how things have been since you last worked together. Sometimes a simple, “Hey, it’s been a while and I wanted to check in,” can reopen a conversation.
The goal is to give people a relevant reason to think about your business again. Let’s say you own a landscaping company and you completed a project for a customer last year. Spring rolls around. That’s a natural opportunity to check in about cleanup or maintenance.
If you’re a photographer who took someone’s professional headshots two years ago, maybe it’s time to ask whether those photos still look like them. If you sell products, look at what your customers purchased before. Is there something new that complements what they already bought?
You don’t always have to manufacture a sales opportunity. Sometimes you just have to pay attention to the one that’s already there.
Give People a Reason to Remember You
Customer retention isn’t only about what happens when somebody hasn’t purchased in a while. It really starts right after the first sale. What happens after somebody gives you their money?
- Do you thank them?
- Do you check in afterward?
- Do you ask how their experience was?
- Do they know what else your company offers?
- Do you stay in touch at all?
If the answer to most of those questions is no, there’s an opportunity to improve your customer retention strategy. Keep in mind staying connected doesn’t mean sending a sales email every other day. Please don’t do that either.
A useful tip, occasional check-in, birthday message, service reminder, loyalty offer, thank-you note, or early notice about something new can keep your business top of mind without making customers feel like they’re constantly being sold to. You want customers to remember your business before they need to Google somebody else’s.
Keep Finding New Customers. Just Don’t Forget the Old Ones.
Growing a business requires new customers. You need new people discovering your company. You need leads coming in. You need referrals. You need people entering your sales pipeline.
But growth isn’t only about how many new customers you can acquire, it’s also about what happens to them after you get them. If you’re constantly spending money to replace customers who haven’t come back, you’re making growth harder—and probably more expensive—than it needs to be. So before you launch another campaign or increase your advertising budget, take 30 minutes and look through your customer list:
- Find five people.
- Reach out.
- Start a conversation.
You might be surprised by what comes back.
And if you’re looking for a few more ideas on how to turn previous customers into repeat customers, Ivana Taylor has some practical suggestions in “How to Sell More to Existing Customers.”
Read Ivana Taylor’s article on DIYMarketers →
Your next customer doesn’t always have to be somebody new. Sometimes, they just need a reason to come back.