October 28/November 4, 2019: Volume 35, Issue 9
By Steven Feldman
Did you ever hear of Russell Conwell’s “Acres of Diamonds” concept? Basically, the theme behind this is a man who wanted to find diamonds so badly that he sold his property and went off in futile search for them. While the man was searching, the new owner of his home discovered that a rich diamond mine was located right there on the property. The central idea is that you don’t have to search the world over for the things you desire most. Your “acres of diamonds” often lie below your feet.
What does that have to do with the price of tea in China? Nothing. What does that have to do with retail? Everything. When it comes to your customers, people who have purchased from you in the past are disproportionately more valuable than new customers. Yet, so many retailers channel their marketing efforts on prospecting for new customers rather than reaching back for old ones. Finding new customers is difficult unless you are relying on word of mouth. Otherwise, to get them in your store you must have a compelling reason vs. another specialty retailer, home center, Floor & Décor-type chain, etc. It’s marketing, whether traditional or digital. And then you have to win the sale from square one.
Every retailer has his or her share of “lost” customers. These are people who bought from you at one point or another but have fallen off your radar. Maybe they moved. Maybe they have not been in the market for flooring since they last purchased from you. Maybe another retailer or retail outlet stole their business from you.
Sam Page, CEO of NeuroTriggers Group, offers five ways to dig into your own diamond mine of lost customers.
1. Figure out ways to prevent lost customers in the first place. Where is the hole in your bucket? Can you be more attuned to customers so you can catch them before they fall through that hole? (In managing continuity programs, there’s a science to monitoring which months people start dropping out and pre-emotively gifting them—with precise timing, to stop them in their tracks.)
2. Devise a system to periodically reach out to all lost customers accumulated during a period of time. This works best if you present some form of dramatic, irresistible offer to draw these people back into your universe. Can you offer something for free? Can you significantly discount a particular product you know they’ll be interested in? This can’t be one of those “whenever I get to it” things. Lock it into your calendar. Maybe it’s once a year; maybe its three times a year. Whatever it is, make it a standard.
3. Create a reactivation package or campaign every bit as elaborate as those you put together to attract new prospects. Don’t just send a cheesy postcard. Don’t assume they remember your whole sales story.
4. When you do recapture a lost customer, be sure you wow them with their first experience and your follow up to it.
5. Don’t be afraid to go deep in your old files. Be willing to incur the same cost in reactivation as in new customer acquisition.
Most mature businesses have the capability to grow sales 50% to 100% by mining their own lost customer files. The diamonds are often there, right beneath your feet—or at least in your computer files.