100% customer retention simply does not exist in the real world. Every business has lost customers for many different reasons. Some go to competitors, others move out of your service area, some will quit using your product or service, a few will pass away, and a few more will no longer be able to afford what you’re offering.
That’s just the reality of the situation. Therefore, if you are not actively trying to grow, then regardless of how great your retention and loyalty programs are, your business will naturally shrink on its own.
Every Customer Bucket Has Leaks
The analogy that everyone is familiar with is the leaky bucket. No matter how hard you try, your customer bucket will always have a few holes in it because of events outside of your control (i.e. death is the most obvious one not in your control).
Right now, as you read this, your business could be shrinking — unless, of course, you have systems in place to generate new leads and customers on an ongoing basis. Knowing this, then shouldn’t your number one priority be to figure out how to turn on the “lead generation faucet,” so you not only replace your inevitable lost customers, but you actually grow the business year over year?
To prove this point, I’ll give you the classic consulting example, which I experienced a few years ago.
Feast or Famine
I’m sure you’ve heard about the feast or famine phenomena with consulting firms. Typically consulting companies will work really hard to generate leads and sales until they hit resource capacity. At that point they turn off the “lead generation faucet” and focus exclusively on fulfillment. The thinking is, why market when you don’t need clients?
Well, we know that’s dumb. Inevitably customers will disappear almost as quickly as they arrived. So eventually the consulting firm is back to square one and has to scramble to turn the faucet back on. If that cycle takes a year then guess what? No growth after one full year of hard work! As someone who rode that roller coaster ride in the past, I can assure you that is a very stressful and frustrating way to make a living.
Again, the solution is to create a system to generate leads and sales on an ongoing basis. And unfortunately, there’s no ONE magic bullet lead generation system. Most businesses will require multiple strategies to generate a sufficient flow of fresh leads and sales.
Here’s a list of a few proven strategies to test if you haven’t already:
- Offer free information online in exchange for email addresses. Then follow up and nurture via email.
- Offer a teleseminar or webinar in exchange for email and/or phone numbers. Then follow up and nurture via email and phone.
- Offer free information you’ll deliver via snail mail in exchange for addresses. Then follow up via direct mail. No, direct mail is NOT dead :)
- Offer a pre-recorded informational message and collect phone numbers via caller ID. Plus, ask callers to leave contact information as a voicemail.
Each of the examples above can be tested using online search ads, online banner ads, print ads, email ads, direct mail, TV, radio, billboard or any other media that gets you in front of your ideal customers. To get started, I recommend you read Pete’s article: My #1 Tip for Generating More Leads.