There is a perceived preference for businesses to chase new leads rather than to pursue new opportunities to sell to their current clients when it comes to sales. Although there’s something to be said for the thrill of the chase, it is much more profitable to sell more to existing customers than pursue new ones.
The Cost of Acquiring New Customers
To put this concept in perspective, consider the cost of acquiring a new client versus the lifetime value of a happy multi-year client who repeatedly buys from you. Selling to current customers who make repeated purchases will generate more profit than continuously hunting down new customers.
That concept is contrary to the mindset of most salespeople, but it’s essential to keep in mind. The goal should always be to sell more to existing customers. Unfortunately, too many businesses neglect existing customers in favor of chasing new leads.
If we prioritize sales measurements, it should be in this order: customer longevity and lifetime value, conversion of new leads to customers, the profitability of the customer, the average sale of each customer, frequency of purchase, and lastly, the number of new leads.
Considerations for Marketing to Existing Customers
Customer retention is a much more important metric than the number of leads generated or new deals closed, as it’s more profitable to expand the sale than it is to land a new client. But how do you retain customers? It’s not as easy as sitting back and waiting for repeat purchases to roll in. To sell more to existing customers, you need to put in some work.
The first step is to gauge customer satisfaction. Most businesses don’t survey satisfaction, nor do they believe it is a priority. However, 68% of customers that leave a company do so because of perceived indifference. They don’t think that we care enough.
It is critical to regularly survey your clients about their satisfaction to mitigate potential turnover and determine what they want. Once you have a good idea of what repeat customers are looking for in terms of your specific products and services, here are some ways to sell more to existing customers:
- Amp up your customer service. Pleasant interactions with staff can be the thing that keeps your customers coming back, even if they’re having issues with your product or service.
- Don’t lose contact. Keep in touch with your customers via email newsletter or direct mail marketing, although not so frequently that you annoy them. The goal is to remind them of your company and offer promotions to encourage them to buy again.
- Reward loyalty. Too many companies give the best promotions to new customers, leaving long-time buyers in the lurch. Instead, offer a rewards program, exclusive discounts, or other special perks to incentivize repeat customers.
It’s not always easy to revise your sales strategy to target existing customers. A business coach can help you gain some perspective. Please fill out my contact form, and let’s schedule a video call to discuss how to sell more to existing customers.
- 4 Practical Reasons Why Consistency Is Important in Your Business - November 25, 2021
- Be Smart: Sell More to Existing Customers Before You Chase New Leads - November 18, 2021
- Hard-earned Lessons About Scaling a Service-based Business - November 11, 2021