Increasing your Customer baseAug 25, 2021
By Andrea Tartaglia – Co-Founder/Director @ The Marketing Leaders Ltd.
Any company has 2 possible growth strategies in relation to their Customers:
- attracting more Customers
- selling more to existing Customers
As many things in business (and life), it is not a binary choice. Both strategies can be run concurrently and have their own set of objectives and activations.
The following considerations focus on the first strategy: growing a company’s Customer base.
Before starting to formulate a plan for attracting more Customers, it is worth doing a quick check and make sure the pillars upon which to build this growth strategy are solid:
- you have a good understanding of the company’s purpose and how it intends to serve its Customers
- this is well summarized in a powerful and purposeful positioning statement (which you know by heart and can recite whenever asked…)
- you know your core Customers (existing or intended) and have collected as many insights as possible on them
This last point is the most important as from it derive a number of various possible strategic directions:
- you might want to attract more of the same kind of Customers
- and/or you might want to expand your Customer base by appealing to a slightly different kind of Customer.
In both cases, you need to know with a good level of depth who your Customers are.
As covered in previous blog posts, we suggest consolidating the knowledge of your Customers into an ‘identity strategy’, which culminates with the creation of one or more ‘personas’ representing the various typologies of Customers you are interested in.
With the objective of identifying or creating the possible ‘personas’, you have analyzed your current Customers base; and have successfully segmented it to create a small number of homogeneous Customers types, who are differentiated by certain characteristics or behaviours.
Each group or segment can then be approached with a personalized, bespoke communication strategy, which has high chances of being effective given that it is tailor made specifically for that group of Customers.
One all this work is completed, then it becomes relatively easy to identify and implement strategies to attract people with the same persona profile as your current Customers.
You know who they are; you know what they like; and you know how to reach them.
You know all this, because they are likely to behave the same way as the people that are already enjoying your products and services.
You have already taken your current Customers through the marketing funnel, and you have successfully managed their buyer’s journey. You can do more of the same to attract more and more Customers, who might not be aware of what you have to offer or need convincing to move from the interest phase to a purchase decision.
In principle, simplifying greatly what is likely to be a complex context, you don’t need to change your marketing and communication strategy, as the messages you have been delivering to your current Customers should resonate with the new (but similar) prospect ones. They, after all, have been identified because they are very similar in characteristics and behaviours to your existing Customers.
As a way of example, I want to sue my experience of working on an entertainment brand like Star Wars.
The brand has a very broad Customer’s base (pretty much everyone from 6 years old and above, with a strong male skew).
Given how broad this is, you can imagine how critically important is to segment the Customer base and identify smaller, more manageable groups.
One subsegment was identified as strategically important for the future of the brand: boys aged 6 to 12. And it was clear that the penetration of products and content consumption among this audience was not maximized. Form these considerations a series of activations aimed at attracting more boys into the brand was born, focusing on social media, where the brand was then underrepresented.
Now let’s switch focus to the idea of attracting Customers that are somehow different from your existing ones.
In this case, I suggest the following:
- identify the key needs that your product and services satisfy and identify new groups of Customers that might be interested in them but are different from your existing Customers base. This is important as you can serve these new Customers without changing your basic product proposition (which requires much more effort, investment, and carries a level of risk associated to the possibility of disappointing our existing Customers)
- identify the key differences between these new Customers and the current ones. How and why do they behave differently? Are there any characteristics that will inform a new marketing and communication strategy bespoke to these new prospect Customers? Use these insights to create new ‘personas’ and formulate a plan to address them
- Start with the new ‘personas’ that are adjacent to your current Customer Base and move progressively away from them until you think you have exhausted the possibility of serving different kinds of Customers with the same product proposition
Same considerations as above apply in terms of guiding new Customers through the marketing funnel and influence their buying behaviors.
Going back to the Star Wars example: once the plans aimed at increasing the number of boys interested and buying into the brand were under way, we identified the need to start attracting new audiences; in particular women. And we started with talking to female members of the audience who shared the same interest in the basic attributes of the Star Wars brand, with message tailored to them but consistent with the key messages delivered to the general, male skewed, audience.
In both cases (attracting more of the same kind of Customers and targeting new kinds of customers) you will be applying traditional marketing techniques or, even better, growth marketing strategies to achieve your objectives.
To maximize the ROI of the activations, I proceed in order and develop activities that allow me to reach the intended Customers through:
- owned channels and platforms,
- then with activities that generate earned media/exposure
- and finally, if needed, add paid activations to maximize reach and conversion.
One thing worth mentioning in relation to strategies aimed at increasing the Customers base, is the need to monitor the churn of Customers.
As stated, the goal is to grow the company’s revenues by attracting new Customers. When setting the goals for how many new Customers you need to reach your growth objectives within a certain time frame, you need to be aware of how many (if any) of your existing Customers you lose along the way.
Obviously, this in important as you need to add more Customers than the ones you lose.
Again, in the case of Star Wars, we knew that as boys grow older, they move out of the brand (luckily they come back later on when they are older). SO we needed to add enough new boys to compensate for the ones we were naturally and organically losing, and the some…
All of the above is applicable in both a B2C and B2B context. In fact, you can replace the word Customer with Consumer, and everything suggested above still stands,
Of course, the techniques used to increase the Customers base are different in a B2C and in a B2B context; but the strategic approach is the same.
And what about increasing the business coming from existing Customers/Consumers?
We’ll leave that for a future post. One where we can talk about LFV (Life Time Value), retention strategies, brand loyalty, etc.
Are you interested in knowing more about that?