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Serving the Public Quest for Knowledge Since 2000

Business Report #11

How to Evaluate The Customer Base You Currently Have

When people call my office and start telling me about a marketing problem they have, I always start out by asking them What type of a customer base do you have right now. Most of them will tell the truth and say they don't know. Others will try and think up an intelligent answer by saying opportunity seekers. Both of these answers are the same. It's quite evident the business owner has no idea who his or her customer base is.

The easiest way to determine who your particular customer base is, is to have your customers complete a simple survey. But in order to get them to take the time and respond to the survey, you have to make it worth their while. Because I ran a publication, I gave people a free 35-word classified to fill out and return the survey. For my MLM downline I gave them free camera-ready ads typeset with their member number for returning the survey. You will have to determine the free gift you want to offer to fit the product or service you sell.

But why would you want to give a customer of yours something totally free just to get their opinion? Because their opinion will make you a great deal of money. If you listen to your customers, and give them the opportunity to order something from you that they want you can spend less on direct mails and make more money.

If you don't like the survey form idea, another way to determine who your customer base is, is to look at the mail you receive from them. Is your daily mail mostly junk mail with a few orders tossed in? If so you need to do something about it. People who mail a lot of junky looking ads are people only interested in making money. They are not interested in spending it, so naturally they will probably not be the type of person to send you an order. You also can tell by checking out the products and services these people are trying to sell. Is it a commission program that you have seen over and over again? If so, these people are followers. They cannot think on their own and probably don't have enough money to buy any worthwhile products from you.

Therefore, if you get 75% or more junk mail than actual orders, you only can make money with 25% of your customer base. Don't even waste your time trying to sell something to the other 75%. It's normally a waste of time.

Send a simple post card to the 25% of your customers who have purchased from you. Offer them a percentage off their next order for being a previous customer. See how many of those customers return the coupon. If you find they don't take advantage of the free offer you have a customer base of people not interested in buying that particular item from you. Therefore, you must either find a product they want to buy, or market it to another group of people.

Another way to determine who your customer base is comprised of is make a list of all the products you sell on a sheet of paper. Ask the customer to check off their items of interest and return to you for more information. As the surveys come in the door, classify the customer under a category. Some of your category headings could be (1) books and reports (2) Internet services (3) advertising (4) typesetting (5) commission programs (6) health and nutritional items (7) mailing list buyers, etc.

Once you have fit your customers under a major category of interest, you can then develop or offer products and services for that particular interest group. Send them ONE offer with an appropriate sales letter and order form in an envelope. Don't offer them every item you sell because it will only confuse them stick to ONE offer for each specific interest group.

In no time you will see a BIG difference in your company's sales!