What if you could increase purchase probability by 200-1,300%, and know that each purchase is likely to generate 33% more than your average sale, and increase lifetime value of your customers?According to CMO.com, if you go against common advice and focus on selling more to customers who’ve already bought from you, it’s very possible.CMO.com reports that “the probability of converting a new prospect… is only 5-20%.” On the other hand, “the probability of converting an existing customer is 60-70%,” plus “repeat customers spend 33% more compared to new customers.”However, most executives know that they’re measured by the results they bring, and, as CMO.com points out, acquiring new customers is the fastest way to see results, even if they’re not the most profitable ones. Developing long term relationships with current customers takes a lot more time.Therefore, according to Econsultancy, only 16% of companies are more focused on retention and increasing customer lifetime value than on new customer acquisition.
How can you do things differently?
6 Ways to Keep Customers Around, Buying More
Since so many companies are not optimizing, it’s easy to stand out of the crowd. Here are our top 6 recommendations to do just that, and relish in a better bottom line.
Prioritize Customer Emotions (Especially in B2B)
Common advice, it turns out, can only take you so far. A 2014 research discovered that while “most [B2C brands] have emotional connections with 10-40% of consumers… B2B brands elicit an emotional connection with more than 50% of their buyers,” reports Kapost.Why?Because there’s often a lot more at stake for B2B buyers than for B2C buyers.Imagine a B2B executive who leads his company to make a million dollar investment, and that investment turns out to be a corporate burden instead of paying itself off and delivering profits. That executive could be fired, with his reputation damaged across the industry, unable to land an equal job or advance his career without proper recommendations. That’s why, according to Kapost, “71% of [B2B] buyers who see a personal value will purchase a product,” and “68% of [B2B] buyers who see a personal value will pay a higher price for a service.”
Companies that want to shorten time to value have to remember this in customer interactions and retention campaigns that helps the buyer justify the purchase (and make him/her look good in front of the executive team).
Ask Customers About the Value They Got (and What’s Missing)
If you’re a manager or an executive, chances are you could climb the Everest faster than you can finish your to-do list. At the least the Everest doesn’t grow every day. And when you’re that busy, it’s easy to get distracted and neglect to notice how far you’ve come.Many of your customers experience the exact same thing. They’re integrating your solutions, but they’re swamped with responsibilities. Life becomes easier with time, or the company becomes more profitable, and it’s all thanks to your solution, but the growth is gradual, and sometimes it’s easy to miss. If they miss it, they won’t buy more and they won’t recommend you to their friends.It’s your responsibility to make sure someone in your company asks customers how they’re doing and what tangible results they’ve seen. As we stated above, be sure to ask how you’ve improved specific executives’ lives as well, not just the company as a whole. Have them affirm to themselves how much you make a difference in their lives. If you implement customers’ suggestions and improve things, let them know. It’ll show them you listen to them and appreciate them. As you’ll discover below, that sometimes matters even more than the quality of your product.
Develop Solutions to Help Customers Get Better Results: Upselling and Cross Selling
Some customers need more help than others to make your product work for them.A very common upselling strategy in B2B world is selling professional services or onboarding packages to customize the solution to fit customers' business needs. Tailoring the product will not only increase the product's effectiveness to solve business problems, but the engagement will deepen customer relationship. Throughout the engagement, field teams can also spot other new opportunities, such as new leads from other departments.Infographics below show how to boost revenue through upselling and cross selling.But there are other ways to help customers drive results. If you share a target audience with them (say, you have a marketing firm and they develop software for marketing managers), you could talk them up to your audience or do a webinar together, so that they’ll get more customers. If you hear of anyone who needs their kind of product, recommend them first – even if you don’t get any commission out of it.Become their brand advocate to help them grow and develop a better emotional relationship with them. They might even end up with a bigger budget that allows them to buy more from you.
Provide Better Service Across Departments and Platforms
Companies that increase customer lifetime value are companies that talk to their customers, do what they can to improve, keep their word, and give credit to customers for making great suggestions. Moreover, they constantly learn about customer challenges and the real reasons they want to cancel.As we’ve previously reported, most customers churn because of poor services. They expect top of the line service wherever they interact with your company, even more than they expect quality products.Smart companies create cross-department collaboration, so they can stay alert on what’s going on with the customer at every step of the way. When departments work together, it’s easier to create a cohesive brand persona across platforms, and to recognize fans and long-time supporters across channels and brands… even when they use a new-to-them touchpoint. There are tools for B2C companies to achieve this, but in B2B, check out ContextSmith.Want to learn more about going omnichannel customer engagement? Check out this roundtable by Jacada, featuring Informa/Ovum and Verizon.
Source: Jacada via YouTube
Build Relationships with Multiple Contacts at the Same Company
As mentioned earlier, emotions run high in B2B. To ensure you maximize deal revenue, humanize your company-to-company relationship by creating personal relationships with multiple contacts in your client’s company.You can do it with content marketing, but also remember to say happy birthday and congratulations when they got a job promotion – information you can easily find on LinkedIn. Create networking events where they’d benefit from meeting your other clients, or ask them to come with you to a conference you know will be beneficial for them.If they transition out of their current job, be on the lookout for new positions that could fit them. If you stay in touch with multiple contacts at the same company, you could end up with clients across multiple organizations as people change jobs or start their own companies.Remember – don’t stick to the superficial level of basic networking. As Jose Gutierrez, who spilled hot coffee on a potential mentor he tried to network with, explains in this funny TEDx talk, it’s about going deeper and connecting on a human-to-human level.
Source: TEDx Talks
How do you increase customer lifetime value? Share it with us in the comments.