So you don’t have a Super Bowl- sized marketing budget? Maybe you’re a small business that doesn’t have a marketing budget at all! Good news…there are other ways to win new business.
How we communicate has changed, how we market has changed, how we service has changed- but one thing has remained the same- “word-of-mouth” (WOM) and its influence on your brand. Still today, customers hold the title of our most influential sales people. Harnessing the power of WOM could affect your top line growth as much or more than your current marketing budget.
In order to understand our customers and their potential WOM affect, we must first learn if they are a Promoter, Passive, or Detractor. Be sure to check out my previous blog “Love You or Love You Not? Truth from Your Clients”, if you’re not familiar with the Net Promoter® Score Methodology. After we segment our customers based on this methodology, we can begin to learn how average customer value differs between Promoters and Detractors. Promoters, generally speaking, make additional purchases, are a “lower cost to serve”, have higher retention, are better customers, and lead to more customers.
Whether you’re B2B or B2C, your customers have more access than ever before to word-of-mouth. It’s not just barber shop and water cooler gossip we are facing anymore. Customer reviews and recommendations on sites like Yelp, Angie’s List, etc. have changed the way we make decisions as consumers. Our “likes”, “tweets”, “shares”, and recommendations have taken over the web. Meanwhile, our loyal customers (Promoters) are helping us win new business and our less-than-satisfied customers (Detractors) are deterring new business and crippling the brand.
Customers that are referred to us have lower acquisition costs and are likely to be more loyal customers. These are the types of customers that help grow our bottom line and create successful businesses. So how do we obtain more of them??
More loyal customers mean more referred customers. A client loyalty strategy can be put into place to minimize Detractors and create the two dimensions of loyalty- head and heart- to increase the number of Promoters. I’ll talk more about how to implement a strategy in your organization in a future blog.
Remember- the easiest way to understand if your customers are loyal is to ask. “On a scale of 0 to 10, how likely are you to recommend us to a friend or colleague?” Or “On a scale of 0 to 10, to what degree do you agree with this statement: I’m a loyal customer and I would recommend “Company X” to a friend or colleague that could benefit from your products or services.” This question helps us measure loyalty and helps us understand what our customers say about our company.
If you’re not already, consider looking within your customer base and service organization in addition to your sales and marketing departments to increase revenues. It doesn’t require a Super Bowl-sized marketing budget. It does, however, require connecting with your customers, uncovering what matters to them, and utilizing the voice of the customer to improve the overall customer experience.
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Net Promoter, Net Promoter Score, and NPS are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.