How does the economic situation help you focus your new customer acquisition efforts?
Creating new customer relationships is one of the most expensive, most ineffective things that businesses do.
Consider how many billions of ads will flash in front of people's eyes today, but go unnoticed. How many millions of direct mail offers will end up in the recycling bin, unopened? How many sales calls won't work, despite hours of preparation, starched shirts, and animated PowerPoint slides?
If there is a part of the business world that most resembles a gas-guzzling hummer, it would be new customer acquisition. There is so much waste in the sales and marketing process that, now, more than ever, we have to be smart and focused about which new customers we pursue, and how we pursue them.
Here's one of the best ways you can improve your return on investment of new customer acquisition investment efforts: Focus on the specific actions you want your prospects to take.
A CEO called me a few months ago and asked me to come in to help him and his team deal with the business challenges the economic situation has created. Finding new customers was a big priority for them, so I asked them to show me what they were doing to make that happen. They showed me ads and advertorials they were placing in trade publications, trade shows they were attending, and a series of postcard mailings to prospective customers. They showed me a Google AdWords campaign, and they told me about the many different methods their various sales people were using to find leads. Then, I asked them to map out their sales process on a white board, showing me all the steps from disinterested lead to committed customer. Within five minutes they told me that they have a 90% close rate if they can get a prospect to visit their facility. I stood up, walked to the white board, and wrote down the list of new customer acquisition efforts that they had described earlier. I then handed the pen to the head of marketing, and asked him to draw a line through all the marketing efforts that were not directly focused on getting prospects into their office. He crossed out marketing plans representing 80% of their proposed spending.
By acknowledging that the true goal of those early lead-generation efforts was to persuade someone to visit the company’s facility, we were able to cut a huge chunk of fat out of the marketing budget. They could either save those dollars or apply them to efforts that focus on this goal. The group even agreed that paying someone's way to their facility was not out of the question—especially now that they'd have the money to do it!
Focusing on specific customer actions not only helps you create a "to-don’t list" of marketing efforts, it helps you focus your message. If the purpose of an ad is just to get someone to call you or come to your website, then you can target the message specifically to that goal. The attention that a prospective customer will allot to you is very limited; by knowing what you want that prospect to do, you can use that ration of attention wisely.
Before blogging became all the rage, Tom was posting book reviews and Observations (essentially early blog posts) to this site. You can find the archives below.
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