If you’re putting more effort in finding new prospects than deepening your relationship with existing customers, you’re making a big mistake.

For many small businesses, finding ways to develop repeat business is an after thought if it’s considered at all. That’s a serious error when you look at how much more it costs to attract new customers, up to seven times more according to recent reports. Failing to do the least costly marketing can be a deadly mistake when you consider the minute size of most small business budgets.

So what should you do to make sure your business doesn’t make this mistake? What strategies should you implement to keep your customers coming back?

Whether you are doing business in the real or virtual worlds, it pays to analyze your processes to ensure that you maximize the lifetime value of your customers.

Here are seven things every small business owner should consider:

• Take a look at your sales process. Do you have a plan in place for how you will capture the second, third and subsequent sale from existing customers? Are you cross-selling or up-selling once you have developed a customer?

• Are you gathering as much information as you can about potential customers during the prospect phase? Do you use that information to improve customer satisfaction with your product or service, the timing of subsequent offers or to strengthen your relationship with those customers? You don’t want to be the company that enjoys a strong surge in sales but has no way to reach those customers again.

• How are you storing this data? Are you automating your system in some way by using contact managers, databases and auto responders? Did you know that some systems will automate the process for you? I’ve worked with small business owners who were surprised when a happy customer didn’t hire them for the next job. Yet that same business owner never considered getting in touch with the client. They were too busy chasing new customers.

• Do you have a newsletter or other way to keep in touch with existing customers? Successful companies know the importance of repeat contacts with customers. They gladly absorb the expense of a newsletter, electronic course or catalog to keep their products and services in front of their customers. Yet too many small business owners see these friendly ways to stay in touch as "too expensive."

• Have you put systems in place to tract the results of your marketing? Do you even know what to track? It is critical to be able to calculate your ROI (your return on investment) to determine if your marketing is working. By tracking you can see if you are spending your marketing dollars effectively, while tweaking the strategies you are using.

• Testing is equally crucial. Before you roll out a major campaign, it is important to test each of the key elements including your offer, the copy, headlines, the price and terms. Who better to give you feedback than someone who already has experienced your product?

Talk to your customers and listen to what they tell you. Provide ways for them to give you feedback. Also talk with them about new products or services you plan to develop. Are you creating that new product or service because it seems like a great idea, or is it based on a need that you have discovered among your existing customer base?

Related Articles:

Seven Steps to Successful Sales

Sales Leads -- All Referrals Are Not Created Equal

Marcia Ming

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