Dwindling customers? How to make more money FAST

By: Dan Kennedy on: March 28th, 2013 12 Comments

A recent article about one of the world’s largest ferry boat systems says they are swiping money from one program to keep another program afloat.

Why are they forced to do this?

Increased  costs coupled with a dwindling customer base.

A cry all too familiar to many businesses these days.

Swiping money from Peter to pay Paul may keep them afloat – but only temporarily.  It’s a stop-gap method that eventually catches up to every business.

Did your business lose customers last year?

If “yes,” my guess is you can’t say for sure how many you lost, who you lost, why you lost them or where they went.

But one thing is for certain…

If you do nothing different, I can send you this same message next year too.

In stormy economic seas, investors turn more attention to preservation of capital vs. growth or yield.

The next four years provide tremendous opportunity, but also are filled with tremendous risk.

Business owners must give more attention to preservation of their business’ equity—which actually lies almost entirely in their relationship with their customers, and, of course, their personal capital: their time and energy.

Regrettably, many do not pay nearly enough attention to these things until forced to by adverse circumstances.

Most businesses get this wrong. They think it is easier to just keep trying to attract new customers. Aside from the fact that there is a finite pool of new customers, in truth, a great way to make more money is to stop losing customers.

This will require accurately determining what a customer is worth and what the cost of replacing a customer really is…so you can decide how much you are willing to invest to NOT lose a customer.

Next taking that investment and deciding how to apportion it, between programs for customer retention and winning back customers. Then designing, re-designing, beefing up and actually implementing both programs. Then testing, evaluating, improving, again and again.

In my own work and you’ll find in GKIC’s strategy, that a lot of time, money and work is spent in doing exactly this, even though we already have low loss/high retention and sophisticated multi-step, multi-faceted “stick” programs for new customers, and “keep” programs for continuing customers, and “rescue and recovery” for lost customers.

Do you?

But we continue and will continue to add to, experiment with, refine and hopefully improve all three.

Will you?

Often we will implement twenty or more different adjustments in a ninety day period. Some minor, some simple, some painfully complex.

How many are you testing in your three programs by June 30?

Every year, I’m somebody’s lost customer. Many don’t even realize I’m lost. I guess they think “gee, he hasn’t been in, in a while,” or perhaps they don’t even know I’m gone. Every year, national companies and local shops lose me as a customer. I can’t recall even one, ever, doing anything proactive and significant about their loss.

That is just one very practical suggestion for making a lot more money fast. Here’s another: upgrade customers before you lose them. You’ll then lose less automatically. This idea alone is worth giving a lot of thought.

You ought to HATE and I mean HATE—losing customers.

The athletes and teams who win a lot hate losing, even more than they like winning. To win races, you’ve got to hate losing. Winning is not sufficient motivation. You NEED to understand the true economics of losing customers.

You NEED to get yourself highly motivated and passionately committed to invest aggressively in not losing customers.

No business exists solely on its owners’ ability to get customers. Successful businesses sustain themselves only keep them.

NOTE: Want more insider information on how to leverage marketing and sales to improve your business?  Click here to claim your special free bonus of $633.91 worth of marketing materials.

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    ABOUT THE AUTHOR:

    Dan Kennedy is internationally recognized as the 'Millionaire Maker,' helping people in just about every category of business turn their ideas into fortunes. Dan's "No B.S." approach is refreshing amidst a world of small business marketing hype and enriches those who act on his advice. For more money-making marketing tips, tactics and strategies, go to www.GKIC.com

    12 Responses

    1. Arnold World says:

      I need your personal help please don’t pass this to your sales lead team. I’ve been on the internet for five years with out one sale. can you tell me how to rebuild my company from scratch so i can turn a dollar finally.

      • Mike Stodola Admin says:

        Arnold, are you a member of GKIC? If so give one of our business consultants a call. It’s free for members. The number is 800-871-0147. They’ll be glad to help and get you pointed in the right direction.

    2. Rob says:

      I am in the carpet cleaning industry. How do I implement these three things into my business. I have some things in place now but would love to have more insights on this.

      • Mike Stodola Admin says:

        LOL – Rob, keep reading and being a member and you’ll have more strategies than you know what to do with!

    3. Joe Bulger says:

      Great article Dan! The other big upside of keeping the back-door closed is that it generates more referrals.

    4. Jim Crossman says:

      I run a small monmental masonry business ( I sell headstones in case you were wondering what monumental was ) Keeping the same customers in my offline business is quite rare since most of my customers only visit me once or twice in their lives which means I am continually searching for new clients of which there is a finite, albeit, continuing base in order to keep the business going.
      Therefore I absolutely have to look for new clients but previous marketing efforts – the usual ads, letters to undertakers etc have little effect.

      I actually stopped advertising about 12 years ago and found no difference in turnover! However I now bow to the inevitable and realise that marketing needs to be done.
      I’m in the process of refining my website but it is up and running however nearly 99% of my client base is local which is why I’ve not bothered with a website until now.

      However my main competitors hardly advertise and do not have a website yet they do a good 75% of ALL the work locally whcih leaves two of us scracthing for the remaining 25%.

      How do they get their work? By being recommended by the three busiest undertakers in town!
      How have they got this arrangement? One of the undertakers has used them for generations,and the other two are run by former employees of this undertaker and so continued to use them.

      It’s virtually iimpossible to get anything but scraps from these businesses so I need to go straight to the public but since a lot of these act on recommendations from the undertakers – well you can see how it goes.

      I’ve said a lot more here than was intended so apologies for that. It’s just that I wanted to point out that somes businesses can’t rely on past customers to get repeat orders.

      • Mike Stodola Admin says:

        Jim,
        I’m sure there are fixes to your troubles but I’ll address your last point first. You said not all business can rely on past customers however you made the point that the busiest undertakers in town keep giving their business to the same company over and over again. It sounds like that company CAN rely on past customers (being the undertaker in this case.) Keep getting creative and find ways to do things differently. If you’re going to go up against a giant, you can’t do the same things the giant is doing to get business or you’ll lose every time. Take a hard look at how you can be better, or faster or go after a different market altogether. Best wishes – D

    5. Terri says:

      I am still astounded to think that this quality of information is available to all business owners and in some cases freely available, yet many business owners have no idea, or simply don’t regard it highly enough…

      You offer such exceptional quality and genuinely educational information.
      Thank you.

    6. Dan,

      Great article. So true what you said, “… my guess is you can’t say for sure how many you lost, who you lost, why you lost them or where they went.” If most business owners actually understood the concept of “lifetime value” of a customer; they’d probably take more steps to keep those customers and not step over dollars to pick up dimes.

      – Brian

    7. Colin Power says:

      Great information…

      Many companies will file this away on the to do list and then store it in the “Fail to Do” folder. Theories are nothing without implementation which leads me to submit this comment about GKIC ‘s failure to implement theory.

      Yes I left GKIC a number of years ago and I’m still waiting to see the “reactivation” program… maybe I was a client that “Didn’t get it” or one that has slipped through the cracks.

      I still appreciate Dan’s theories but after travelling half way round the world to attend an event found the implementation of the GKIC team was mostly theory.

      • Mike Stodola Admin says:

        Colin,
        I’m sorry you feel that way and I’d be interested to hear about what it’d take to bring you back. I can’t speak to your exact experience, but if you visited our office you’d find a lot more happening than theory. Right now through infusionsoft we have 504 active campaigns happening right now (I just checked.) We have dozens of funnels and strategies at work every hour of every day. We’re constantly testing new marketing strategies and letting our members know about those success and failures. Those who are a part of our Copy Confidentials/Look Over The Shoulder program have insider access to all of this information. This may not have all been in place at the time you left (and shame on us at that time for not having it in place) but I’ll assure you, we’ve got a lot of gears grinding away at any given time right now and more come out on a monthly if not weekly basis. Thanks for reading and do let me know what it’d take to bring you back! If it’s been a while…go to http://www.dankennedy.com/incrediblegift and test drive things for two months on us! – D

    8. Ron Sample says:

      Nice post with some excellent advice! We are a small company providing a service. I think the commitment to keeping our customers satisfied comes from the top down. If the boss believes it and lives it, so will all the employees. It is often possible to sense that a customer may be dissatisfied. The key is to do something about it if this starts to become apparent. Often being proactive and really asking the customer to share concerns is enough to repair the damage and move forward on much sturdier ground.

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