Find New Customers, or Sell More to Existing Ones? Which is Better?

When I ask this question, I receive one of two responses. A blank look or “What do you mean? It’s always better to get new customers.”

Really? Can you tell me how much it costs you to get a new customer? How much time do you spend nurturing the relationship? How much time do you spend talking to people who have no need or desire for your products? How much money do you spend finding people who want to talk to you? How much money do you spend on different types of advertising? The list goes on.

It doesn’t matter what business you are in; the hardest dollar to get someone to spend with you is the first dollar. Once a prospect has spent that first dollar, he or she is committed. It’s only a small commitment, but it’s a significant one.

Doesn’t it make sense that, once people spend the first dollar, you should concentrate on helping them spend the second and third dollars? Design a system that offers a low-priced item to attract people—a deal too good to be true. Then when they purchase that item, continue nurturing the relationship. This is a good time to offer them another deal—a good deal, but one you can make a profit on—at a higher price point.

I have found the cost of marketing to existing customers to be much lower than any other marketing cost. You already have their contact information. You can e-mail them; mail a letter, postcard, or catalog to them; target them with a Facebook ad; or call them. You get the idea.

If you don’t have this kind of information, you need to look at the systems you have in place to obtain it. Some questions you should consider when designing these systems are:

  • What systems do you currently have in place?
  • How do you attract people for the first sale?
  • What do you have in place to get a second sale?
  • What results have you been getting from your current systems?

If you want to grow your business, spending time developing these systems is something you need to spend time on every few months.

Don’t forget: the most profitable group of clients you can market to is your current one.

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