Lets jump straight into it:
1. Do you have a database of customers?
2. Do you have a database of inactive customers?
3. Do you have a database of non-converted leads?
4. Do you have a database of your target market?
5. If you have a database, what sort of information do you keep?
You see, if you do not have a database of leads of your target market…
1. You can develop a telemarketing script, but you have NO one to call.
2. You can write an awesome direct mail, but you have NO one to send to.
3. You can design a fantastic fax, you have NO one to fax to.
4. Ditto for almost every other strategy you can come out with.
If you do not have a database of customers (both active & inactive)…
1. You cannot sell them more stuff effectively, you don’t know where to start.
2. You cannot re-active inactive customers, you don’t know who they are.
3. You cannot keep in touch with your customers effectively to generate loyalty, you do not know who to keep in touch with and how frequent.
4. Ditto for most other strategies to increase customer lifetime value.
If you do not have a database, you are likely to be …
1. Doing non-targeted strategies hoping to hit your numbers by raising your level of activity alone.
2. Sending your sales team to the field blindly, hoping the pressure of numbers, increased activities and incentives will get you results.
3. Frustrated by the poor response to your campaigns.
4. Advertising in the wrong places (if you advertise), because you do not know your target market well enough to know where to advertise.
5. Ditto for most strategies, you will be focusing on activity level alone instead of the right activity at the right level.
So if you still do NOT have a database, I hope you are convinced today that you need one, and you will start to build one TODAY.
Here are some tips on how to get started:
1. It is not absolutely necessary to invest in expensive CRM software, you can track manually if necessary or…
1.1 Depending on your business, a spreadsheet might be good enough. Just make sure each column is 1 field of information (first name, last name, address 1, address 2, etc.) so that if one day you invest in a CRM software, your vendor can easily import the information over, you don’t have to manually transfer them again.
1.2 Google’s free service, Gmail, Contacts, Calendar, etc., accept 10,000 entries… so if your target market is small enough to never exceed 10,000 and you have a small team, you can easily use their free service to maintain a contact database.
1.3 Your accounting module (if you have an accounting software) usually have information of existing and inactive customers… you can add a contact database module if your vendor has such a module.
1.4 You can invest in an online subscription base CRM like salesforce.com.
2. If you advertise, drop flyers, participate in exhibition or do online marketing, make sure you capture information of every lead you get in your database and classify them according to potential.
3. If you have an accounting module as per point 1.3, start to build reports on inactive customers (classification of inactive depends on your industry and sales cycle, discuss with me), frequency of purchase, average transaction value, lifetime value, products/services bought, etc.
4. Extract contacts that fit your target market from trade association memberships, industry directories (info pages, super pages, etc.), yellow pages, exhibition lists, etc.
(Note: If you use directories as your source, you will usually need to clean up the data yourself; our own experience is anything from 10-30% of the contacts become invalid after 1 year.)
5. Use Google to search for businesses by location, by industry, etc… don’t do it yourself, engage an intern or pay a part-timer to build a database for you.
6. List brokers. From our own experience, most list brokers in Malaysia charge an exorbitant fee for one-time use of their database. Personally, I prefer to spend the money to build my own database instead and use it forever with the same or less money. It costs me anything from RM1 to RM5 to get a contact, but a one-time use of a list-broker easily cost above RM10-20 per contact for ONE time use. So list brokers are the LAST RESORT.
Having a database is key to your success; it is one of the unglamorous but absolutely necessary part of your sales & marketing effort.
Finally, a business with an extensive database is almost always valued higher should you wish to sell your business one day.
Need help to get started on database building & strategy planning that works?
Register NOW for our FREE Business Optimization Clinic, valued at RM750. We guarantee you will get at least 1-2 ideas you can implement immediately, even if you do not engage our services. Have a profitable week ahead!
The Familybiz Works Team
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