Getting the RIGHT Customers Online for your Business
CUSTOMERS WITH 'TOO MUCH WORK'
I was talking to some potential clients earlier this week, offering free listings on our site buildingleads.sydney to companies in the building industry - architects, builders, landscapers and so on. There were a few surprises in store and I realized yet again that there are many ways to getting the right customers online - but first, you have to recognize them!
FAMINE OR FEAST
Many of these companies often suffer gaps in their project pipelines due to projects being cancelled. They are then in the position of having all of their operating expenses continuing, but no revenue until their next project. So we built that site to connect these businesses and to allow them to tell each other about projects they might apply for and projects on which they might work together.
TURNING AWAY GIFTS
We are offering those listings free, simply to introduce ourselves to a wide range of companies and of course, we hope to do business with them when they need a new websites, SEO or any of the other services we offer.
So we were surprised when some companies said "no thank you - we're too busy". As business people, that seemed bizarre to us, and likely to lead those businesses into "famine or feast" conditions.
Surely we thought, every business needs a measurable flow of customers from its online presence no matter how healthy its current order book. Then we thought a bit deeper and asked ourselves, if we had too much work, which customers would we prioritize - what type of customer is best for our business?
FOUR TYPES OF CUSTOMER - WHICH ONES DOES YOUR BUSINESS NEED?
There are 4 types of customer:
1) LOW MAINTENANCE - LOW PROFIT.
These customers tend to buy a low cost product. They are low-price shoppers who tend not to return items or ask for much after-sales support. A business does not lose money with these customers, but neither does it make much money. These customers can carry your company through a bad time so don't ever ignore them! They are your 'budget travelers'', subsidized by your 'business class' customers. This is a neat analogy, because although some airlines specialize in purely budget travel, they are masters of their operations, run on very low margins and rely on volume business. One small fluctuation in operating conditions and they run at a loss. Don't be a budget carrier unless you really are a master of your craft and can generate high volume business.
2) HIGH MAINTENANCE - LOW PROFIT (OR LOSS).
These customers also tend to be low-cost shoppers, but unlike customer type (1) above, they also require a lot of post-sale attention, eating into the small profit of your initial sale. They do not buy post-warranty support packages, but demand continuous attention and support. They can even turn a good initial profit into a loss. These are the worst type of customer and should be avoided. They stretch the resources of your company long after the sale and are a direct cause of bad business performance. This is the sort of customer who receives a first class product exactly according to his/her requirement but then complains constantly and unreasonably.
3) LOW-MAINTENANCE-HIGH PROFIT
These are premium customers. They buy your product after careful discussions and they understand what they are buying. As long as you deliver honestly and professionally, these customers are a foundation pillar of your business and should be cherished. Don't make the mistake of forgetting about them after the sale - stay in touch, look after them and make sure they are happy. They have paid a premium not just for your product but for your integrity. They believe in you - keep it that way.
4) HIGH MAINTENANCE - HIGH PROFIT - You are now getting the right customers online!
It's not so simple to define these customers! They have paid a premium for your product, and yet they have not evaluated it properly. The fact they are HIGH PROFIT despite their HIGH MAINTENANCE demands means that they are PAYING for that maintenance - and that means recurring revenue. With professional care and support, these customers will keep paying you for support, but their demands will decrease as time goes by thus decreasing the load on your company and increasing your profits. In the medium to long term, they are even better customers than (3).
CONCLUSION: GETTING THE RIGHT CUSTOMERS ONLINE
When your business starts out, it will tend to attract the low-cost shoppers of types (1) and (2) and you will be attracted to them as they are the easiest to win. Do NOT let this situation persist. Because you have few or no reviews yet and because you are still unsure of yourself (most new business owners are at first, and it shows!), you will find it difficult to gain traction in getting the right customers online which are types (3) and (4) in most cases.
You must use your first stream of low-profit customers to gain a good online reputation (lots of reviews) and then shift the focus of your online marketing to attracting the most profitable customers for the long-term benefit of your company.
SYDNEY BUSINESS WEB
Sydney Business Web can provide a custom-strategy for its business customers, guiding you through the process of attracting the type of customer your business needs at each phase of its existence. If you need help in getting the right customers online - we can help you.
We do this by putting business expertise into every one of our products - Business websites, SEO, Reputation Management and Social Media management and Marketing.
We can help your company with so much more than a website. Contact us today.