SUMMARY
The objective of any business is repeatable sales from a well-qualified customer base whose value keeps growing. To grow, increase the number of customers served and the basket value of current customers.
The second part is difficult if you only provide one service or product. It is possible to offer bundled services or products, even where you do not manufacture or build the complimentary lines.
Most businesses exist in highly commoditised markets with little differentiation and a healthy dose of competition.
The downside is that already thin margins get pressured. We look at two suggestions to help businesses lower acquisition costs and help with retention.
Every business starts with a handful of customers. Assuming that the product or service resonates with the customer, the ambition is to make every customer an ambassador and have them talk up or refer the business.
This programme should be easy to engage with and realise value. Instead of shredding prices in response to a margin-destroying move by competition, take part of the available margin and share it with customers.
This mix of loyalty and referral benefits can result in a healthy pipeline of potential customers who convert or upsell easier.
There is a hook for current customers too, who now have a number that keeps rising every time they purchase or successfully send someone your way. To prevent false positives, unlock benefits through actual purchases.
Remember, after initial market activation, the plan is to fund this from sales with unit economics that work at scale. Discounts and subsidies are a poor strategy for commodities. Withdraw these and sales often vanish.
The second part is around automation. For your ambassador programme to make sense, operate error-free, and meet expectations, it must run autonomously off the business logic. Many tools can power this automation.
The communication channels your customers and leads are most likely to use inform this choice. Email, social, web, SMS, and USSD are some that you can consider.
Various platforms stand out in their tooling to help build out features. Firebase, by Android, has a software development kit that makes it easy to build invite flows and dynamic links on apps.
Cloud Sponge has a fantastic tool that improves contact-importing workflows. Mailchimp offers pre-built customer journey templates. These are a few examples of tools that could be in your automation arsenal.
The building blocks are available, but the execution can be as varied as your teams’ imagination and ambition.
Njihia is the head of business and partnerships at Sure Corporation | www.mbuguanjihia.com | @mbuguanjihia
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