Profit Power of Customer Intimacy: Deliver Top Line Revenue and Earnings Growth
*Note: The article was written on October 10, 2017, and therefore references the terms "November" and "just in time for Christmas".
You’ve built your brand, you’ve detailed your processes with a customer experience map of deliverables that's ready to share on social media. You've optimized your website for conversion and have tweaked pricing to maximize revenue. But those efficiencies don't matter if you're still losing out on sales due to low conversion rates. The real problem is a leaky funnel between the presentation of value and customers' perception of it—and it's not just A/B testing we should be doing.
The framework of your digital marketing initiatives rests on the idea that you’ve done everything right up to the point when your prospect clicks “buy.” But in reality, a lot happens after that click—including price decisions, return visits, and referrals. A recent report from DemandWave found that only 2 percent of customers convert on their first visit to an ecommerce site. The majority of sales are driven by repeat visits or referrals by existing customers.
Since sales-ready leads don't appear out of thin air, we have to look beyond our website traffic and conversion rates and consider some less-attended aspects of digital marketing: namely, customer engagement and retention.
An average of more than 20 percent of first-time buyers don't return to make a repeat purchase. Moreover, 17 percent of customers will buy again, but they won’t refer you to anyone. The vast majority of customers—60 percent—will only buy one time before disappearing forever. It's foolish to assume that a customer who has already purchased from you once will continue to do so in the future. You can't depend on repeat purchases from existing customers just because they returned at some point in the past.
An effective digital marketing strategy should consider a wide range of strategies to engage with your prospective customers, build trust, and convert them into buyers. And the more quickly you can demonstrate to them that you are the best choice for their next purchase, the more likely they'll be to do business with you.
In order to improve customer satisfaction, human resources must be optimized throughout your organization. If a salesperson is having difficulty selling, for example, it could be because the customer service manager has hired underqualified staff or overpays her employees. Investing in people has to be part of the equation when building your sales team.
Sales teams that are stronger and more responsive can help you optimize your human resources. If a customer discovers a problem with a purchase after the fact, they should be able to reach someone at any time and have their problem solved immediately—no matter what time of day it is or where they are located in the world. If this isn't possible, then you need to rethink your website’s shopping experience. You also need to look for ways to enhance the customer experience as much as possible by offering special benefits that might have eluded them before.
When human resources are properly optimized and are in alignment with a customer’s buying expectations, then you should be able to deliver on the bottom-line results you want. And when customers make more repeat purchases, those results will multiply. One purchase leads to another, which leads to another. Your sales team becomes more efficient by having fewer prospects to deal with; your marketing efforts improve since customers are more likely to buy from you than from your competitors; and your costs fall because there's less need for advertising.
Customer intimacy is the most powerful thing you can do to grow your business. It's a method that presents your brand as the answer to the customer’s problems and makes them want to buy from you. As a result, your business succeeds. When customers are happy with a purchase decision, they'll refer others to you—and this will drive more sales for your business. So don't just put up ads and hope for the best. Instead, take control of what happens after someone clicks “buy” by learning how to maximize customer engagement in order to earn more long-term revenue.
This article and the attached slide deck were originally published in October 10, 2017 on Forbes.com and can be downloaded here: http://www.forbes.com/sites/jasonarkins/2017/10/10/the-profit-power-of-customer-intimacy-watch-pitch-video/#7f35e93d0c7f .
To read more about how Profitability First has helped Fortune 500 companies achieve their goals, visit www.profitfirstcareers.com .
To adapt this framework for your own business, please visit our online training portal by going to http://www.profitfirstcareers.com/salesforceMTCommunicationTrainingPortal .
To learn more about Profit First's methodology, visit our website at www.profitfirst.com .
You can also find me on Twitter (@Jason_Arkensen) and LinkedIn (Jason Arkensen).
Additional Resources:
Start Your Business by Profit First - http://www.profitfirst.com/start-business/ Making Profitable Growth Simple - http://www.profitfirst.com/blog-2/profits-above-planning-makes-growth-simple Inside the Mind of a Maven - http://www.profitfirstcareers.com/mavens How to Pay Yourself by Profit First - http://www.profitfirstcareers.com/pay-yourself/ Investing in People: How to Build a Strong Sales Team - http://www.profitfirstcareers.com/salesforceMTCommunicationTrainingPortal Why Your Marketing Is Not Working - http://www.profitfirstcareers.com/marketing-2/why-marketing-isnt-working-meeting-prospects
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Conclusion
It is important to note above how future revenue is a function of two factors: - selling price and customer intimacy. It is the customer's impression of your product that will dictate the future stability of your sales and revenue. The speed with which the salesperson can demonstrate to them that they are your best choice in purchasing decisions will determine how quickly they will become a customer again. The more loyal customers you have, the more quickly you can demonstrate to them that you are the best choice for their next purchase, the more likely they'll be to do business with you.In order to improve customer satisfaction, human resources must be optimized throughout your organization.