In business, you need to focus on the long-term. Getting new customers is important. But serving your existing customers well ensures that your business has a sustainable source of revenue.
Last year, 237 people bought the 72ig implementation program via my affiliate link. And 54% of those sales came from existing customers. That’s massive. And this rate increased over time.
It can cost five times more resources to attract a new customer, rather than retain an existing one. When you increase the retention rate by a mere 5%, your profit can go up from 25% to 95%. It’s simply more beneficial to retain existing customers than search for and pitch to new ones.
It’s not only about profit. Repeat customers are the #1 measure of value creation. It means your business is actually helping your customers. Otherwise, they would not remain a customer. That’s the most important thing I’ve learned about building a sustainable business
In this article, I’ll share tips with you to improve your retention rate so you don’t have to keep chasing new customers.
Price your products honestly
Greed is a common pitfall in business. That’s why I’m not a fan of getting in business for the sole reason of making money.
Businesses thrive because they are useful. They give real value. So many people are willing to pay good money for products that change their lives, entertain them, save money, or have a practical purpose.
But there’s a limit to how much customers will pay in return for that value. Pricing your products honestly, based on the actual value it can provide your customers, is much more profitable in the long run. This also encourages people to keep buying more of your products.
Pricing is a very difficult thing. You don’t want to undercharge, and you don’t want to overcharge. I prefer starting a bit lower than your ideal pricing level, and then gradually increasing your prices over the years as you improve your products and courses.
Plan multiple products and services
This is obvious, but people can only become repeat customers if you have multiple products/services to offer. So when you introduce a new product, always think of your existing customers as well. Is your new product something that fits within your existing lineup?
But you don’t have to create all your products at once. If you’re a small business owner or a solopreneur, you only have so much time to create high-quality products/services. I started with one digital product. And then I added at least one digital product the next year, over the last 2 years. By now, I promote six digital products in total.
Of course, it’s impossible to know what product will launch in five years. But you need a sense of direction. So always keep the future in mind. What products can potentially be introduced in the next five years?
Serve your customer throughout their lifetime
You ideally want to take your customer on a journey. When they start buying products you are promoting, you want to offer them different products as they grow.
The best example is the car industry. Let’s say you’re a BMW fan. And your first car is a used BMW 1 Series. As you earn more, you might switch to a 3 Series. And later on to a 5 Series. Before you know it, you spend all your life driving a single brand. As your needs change, BMW is there to serve you the car that you need.
There are tons of useful and effective multiple products/services for your customers, you can ask, “Where are my customers starting? And where do they want to go?” Then you provide or look for a product/service that solves every stage.
Repeat customers are important: Keep serving them
Running a business takes a lot of time, money, attention, etc. While you’re busy attracting new customers and running the logistics of your business, you can’t neglect repeat customers. If you just sell and get out, you won’t be giving them much value afterward. Nobody wants to feel left in the air as soon as a seller receives their money.
Data shows that “poor customer service” is the 2nd top reason why shoppers stopped buying from a brand (“higher prices” being the 1st reason).
That’s why I always respond to reasonable emails, comments, or inquiries from my customers. I check-in with customers now and then, to make sure they’re using products I recommended, and that they’re actually learning from them.
Always ask yourself, “How can I support existing customers in different stages of their Goal Journey?” Then test your business idea, look for a Minimum Viable Product (MVP), launch it, and adjust it over time according to customer feedback.
Do these well, and you’re on your way to becoming a full-time, not-struggling entrepreneur.