How to Increase Your Sales With a Customer Strategy for Small Business
Do you have a customer acquisition strategy? Ideal customer profile? Buying journeys? Pricing? Risk assessment? All need to be considered when looking for marginal or significant gains.
The key is knowing your customers and target audience well enough to create content that will resonate with them, plus use the right marketing tools in their journey.
Who are your ideal customers?
Defining an ICP (Ideal Customer Profile) is an essential exercise to ensure you market your brand and services/products to the best-fit business or person. Think critically about those customers that are ready to buy; that understand your proposition; that align with your brand values; and that repeat purchase. By profiling your best customers, you have the opportunity to funnel all of your marketing and retention efforts to those that are most likely to become advocates. The majority of customers buy through recommendations from others so bagging and nurturing customers who could become advocates will be the cheapest source of referrals in the long run. Get your ICP defined.
As a note, if you have a salesforce, it is then equally important to disqualify out non-ICPs from your sales process in a militant fashion. Non-ICPs are a distraction.
What is your customers’ buying journey?
Ask them, don’t assume. In this post, I talked about interviewing your customers as a part of your regular weekly routine. For some customers, good old-fashioned recommendations from their peers are the only way they buy. For others, more research is required and so testimonials, case studies, review site comparisons, and Trustpilot are key to their decision-making. Sometimes they just happened upon you. Without talking with your customers, you won’t know what their buying journey looked like and are at risk of spending money on Top of Funnel marketing in error.
What stage of the purchase journey are your customers on?
Now that you know what buying journey your customers actually went through, take a step back and look at your ICP and the purchase journey that they are likely to go through.
Are they in pain and looking for a solution like you or have they happened upon you and you’ve piqued their interest? Ensuring you understand your customers’ buying journey even if your business is in less obvious industries such as hospitality, gives clearer insight over the types of collateral you will need to create to support them through every phase.
In the case of hospitality, for instance, being ready to buy is often more than assessing whether customers are hungry or not. E.g. are you an occasion venue? Do you need to seed Mother’s day in their head? Should they think about you when they need a quick fix at lunchtime? etc? Knowing who you are and the problem you solve is the start, then map them through these phases.
At the awareness stage, your potential customers need to be made aware of the problem you solve. This is big thinking, not brand focussed. They don’t are about you yet, as they don’t know they have a problem. You’re going to describe this for them in multiple ways through multiple mediums.
The next stage is consideration. Your customers now know that there is a problem, and are looking for ways to solve it, video guides, Ebooks, blog posts and podcasts describing how you solve that problem sit here. Get that education out there.
Then there’s the decision. You must ensure your referral mechanisms are singing to ensure they get social proof for your solution. Comparison sites, testimonials, social media posts of customers using your product or service are all essential here.
Think about the last 5 purchases you made personally or for your business and map your journeys out as a starting point, you’ll get the hang of it.
How did you decide on today’s pricing?
Changing your price is the biggest lever you can pull that will have the biggest impact today. But you need a strategy. So consider the following and review your prices at least quarterly:
- Benchmarking competitor research. What are the pricing benchmarks of your competitors and how do they differentiate their services or products? Mystery shops them. It’s the best way to understand how you need to stand out. Are you the quality version and can price accordingly? Do you want to land grab and undercut their pricing? Whatever your approach it should be deliberate and not accidental.
- Willingness to pay. In tandem with the above, undertake customer research to understand the maximum and minimum they would be willing to pay for your product or service. What are the essentials, nice to have’s and tumbleweed elements of what you provide that would make them willing to pay? Often this is a shock and gives you further ammunition for your marketing efforts as listed in the section above.
- Test the impact of your new prices on your cash flow before you set them. You must understand the cash flow, revenue, profitability, and tax implications of any price change before you implement them. Use Futrli Predict to do this quickly and simply.
Risk assess your current customer base.
This section will only apply to non-cash businesses. Futrli’s Flow can do everything below for you automatically.
Get your customers’ credit scores
Don’t do business with companies that could put you at risk, so check their credit score before agreeing to provide credit. It’s perfectly acceptable to set policies that customers with poor credit scores that ensure you are paid upfront before the product or service is provided. Do not expose yourself unwittingly.
Late payments are a huge issue facing small businesses. A Market Finance report revealed that payments in 2019 were being made twice as late as they were the year before. Where you can, move your customers to Direct Debit. Gocardless can link to your Xero or Quickbooks account and provide Direct Debit services for recurring and one-off payments. Using a service like this means that you need to bake the process into customer onboarding, but that is simple to do.
Another solution that is relatively new to the market is Invoice Insurance. Up to 90% of the invoice amount (there are terms of course), can be insured for a very small fee. This ensures that your cash flow remains buoyant.
You must know what your average customer payment days are. If this figure is higher than the days it takes you to pay your suppliers, you are likely to hit cash flow troubles.
Do not become too dependent on one customer. It sounds obvious, but without dependency being assessed regularly, this can be missed. Your entire business is at risk if they move to a competitor or go bust, so diversification is key, ensuring your revenue is spread across multiple, good-paying, high credit scoring customers.
Who are your best customers from a repeat revenue basis, consistent late payers, overdue, etc? Being able to rank your customers across multiple data points, gives insight into strategies that you may not have considered, particularly when defining your ICP (Ideal Customer Profile).
Becoming customer advocates.
As you nurture your customers to come back and repeat purchases do you have an advocacy plan in place? If we understand that referrals are often one of the primary factors in buying journeys think about how you can bake advocacy points into the post-purchase journey for your customers.
Are they prompted via email or social media to give you a Google, Trustpilot or industry-specific review? Can they contribute to a case study? Could they be a guest blogger or vlogger? Sites like mention-me can create a full referrals service for you to use on your website so check them out: use technology here to create as much of a viral loop as is possible.