Brands should spend less time selling and more time nurturing - Gartnerby
We all know how significant loyal customers are to a business, but could they contain more value that you’ve yet to unlock? In a recent blog post, Gartner’s research director, Todd Berkowitz, suggests that organisations could see a 20% increase in revenue by increasing their focus on marketing to existing customers, as opposed to just selling to them.
“When study after study shows that it’s easier and cheaper to sell to existing customers than to try to acquire new ones, and loyal happy customers are key to influencing prospects, provider marketers should be completely engaged in this effort,” says Berkowitz. “Account managers or 'farmers' do a great job with account maintenance but they are neither marketers nor product experts. And that’s a problem because customers don’t just want access to support or basic account management, they also want frequent contact, tailored offers, white papers and other things that should be coming from product marketing and management rather than sales.”
He references a Gartner research piece, for which over 500 buyers of B2B technology and services were surveyed. The findings revealed that a significant proportion of participants felt that the marketing communications discussed above were major drivers of positive consumer relationships and, in turn, encourage more purchases.
Figure 1: Marketing Activities Rated as Extremely Important in Maintaining or Growing the Relationship with the Provider. Source: Gartner (2013)
When it comes to marketing to existing customers, Gartner recommends a four-step framework:
1. Agree on marketing’s role and objectives
2. Collect, consolidate and correlate data to uncover hidden opportunities
3. Map content and activities to the customer’s buying journey
4. Enable the field and partners for selling to existing customers
“Each of these areas, and especially the last three, can require significant time and effort upfront,” warns Berkowitz. “While so much more data is available than ever before, not of all of it is created equal, and it’s important to figure out what really matters. Analyzing the data usually requires tools that work based on resources, skills and IT support. Content geared toward existing customers will need to be developed or modified from existing content. And if the sales force (particularly the account managers) and partners aren’t really adept at cross-selling and up-selling, they will need training and support in order to be successful.
“In the end, a customer base should be viewed as an asset, one that needs to be both protected and constantly nurtured to gain maximum value. To capitalise on this asset, provider marketers need to apply the same level of discipline, rigor and effort toward expanding existing account revenue as they do toward acquiring new customers.”