Building Your Customer Base (Part 2): Leveraging Existing Customers

In Part 2 of this series, let’s dive into some tips about how to leverage your existing customers. As mentioned in my 10 Steps To Growing Your Customer Base post, winning new customers is much more expensive than selling more to your existing clients.

Why you should concentrate on looking after your most profitable customers

There is good reason to concentrate on looking after your most profitable customers: In general 80% of sales come from just 20% of your customers. Figures also prove it costs around 5 times more to get new customers as it does to sell to existing ones.

So it makes absolute perfect business sense to identify your most profitable customers.  By making sure you provide them with excellent customer service, you are ensuring they will remain loyal and to maximize your profits.

Not only that, but they will be much more likely to recommend you to others. Your most profitable customers are the ones who will provide the foundation for the growth of your company. You can increase your profits further.  Knowing the characteristics of these clients makes it easier for you to identify and target prospective customers who share similar characteristics.

Derek Williams, chief executive of The WOW! Awards for Customer Service, highlighted how important it was for businesses to identify profitable customers.  He said: “The secret to growth is to have more customers of the type you want to have, to increase your average sale value and to get them to buy more often.”


Building good relationships with existing customers

Communication and good customer service is central to strengthening and building your customer base, but where do you start?

The golden rule of marketing is: Go where your customers are. You could have the greatest idea in the world, but you have to get people to see you. After all, you need to have customers before you start worrying about profits.

For the majority of small businesses, being visible today means having a presence on the internet. According to, the IMRG Capgemini Retail Sales Index for March 2013 found a 16% rise in internet sales, compared to the same time last year. In April 2013, Reuters reported 70% of internet users now use social media.

Small businesses have responded well to these statistics by selling online. 36% of them are reaching out to customers through Facebook. Reports in March 2013 show that there are over 15 million brands that have their own Facebook page.

It is well worth doing your homework to find out what channels you should be using to target your customers. A simple way is to ask your customers where they go online.  It is also worth looking to see what your competitors are doing.