Todd Berkowitz, research director at Gartner Inc., says the impact of marketing to existing customers can be great. In a recent post titled, Why Companies Need to Market -- and Not Just Sell -- to Existing Customers, Berkowitz writes about how important it is for the marketing department to focus on satisfying current customers and increasing customer loyalty, in addition to the usual responsibilities of building brand awareness and attracting marketing-qualified prospects (MQPs).
The Gartner post points out that hitting or missing quarterly sales goals, especially in the B2B world, can come down to whether a few key "new name" prospects inked a deal in the previous three-month period. Those key sales each quarter trickle down to future revenue -- and company momentum in the eyes of Wall Street, media, employees, and beyond.
A Bird in Hand...
As the old clichés say, it's easier to keep an existing customer than to find a new one. And yes, a bird in hand is worth two in the bush.
So it stands to reason that marketing to current customers -- to expand the relationship, to ensure customer loyalty -- can be critical to sales success. In fact, Gartner's research shows that technology companies and service providers can increase revenue by as much as 20 percent by taking a systematic approach to marketing to their own existing customers.
Although this particular bit of Gartner research focuses on technology and service providers, marketing to existing customers is just as important for other businesses, as well. It's really just common sense -- Marketing 101.
And yet, many businesses treat customer loyalty and customer experience management (CEM) as the responsibility of the sales and service teams, not the marketing department. While sales and service reps have a customer-facing role, marketing staffers behind the scenes also need to take a serious interest in building customer relationships, assessing customer needs, and optimizing customer engagement to maximize long-term profitability.
Advanced Relationship Building
"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 [new] prospects," Berkowitz writes. That's why marketers need to be "completely engaged" in marketing to their company's own customer base.
Account managers or 'farmers' -- the salespeople looking for new sales leads -- can often do a great job with customer relationship management (CRM) and account maintenance, following through with leads in their CRM database. (continued...)