Businesses that are overly dependent on one or a few customers are at risk of losing a lot of revenue if those customers cease to purchase their products or services. A company whose top client contributes, say, 20% of its income, will be hit hard if that client ceases to patronize them.
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Many enterprises devote a lot of effort to trying to keep such customers. This isn’t a bad thing. But it shouldn’t be all that they do.
If you’re going to protect your business from suffering due to the loss of a key customer, you’ll need to diversify your customer base. Doing this won’t just shield you from the impact of a client’s exit; it could also boost your revenues and profit.
Here are five things you can do to broaden your customer base.
Ask For Referrals
Referrals are one of the most effective ways to gain customers. Small businesses with limited funds to spend on advertising can still grow if their existing customers are referring new ones to them.
It’s easier to get referrals if you’re doing a great job of meeting your customer’s needs. If they are satisfied with what you provide them, they will direct contacts with similar needs to you.
But a lot of the time, even the most satisfied of your customers may fail to refer people to you unless you encourage them to do so. Asking them for referrals increases the likelihood that they’ll share information about your business with their contacts. People introduced to you this way could eventually become your customers.
Intensify Your Marketing Online
The internet presents you with great opportunities to expand your customer base. With it, you can reach a large audience, including a good number who want the solutions you provide.
If you aren’t getting a lot of traction from the web or social media, it’s probably because you’re not using those channels right. Tailoring posts for social media, sharing useful content regularly and at the right time, and adopting SEO best practices will help you boost the engagement you get online. This could in turn draw more potential clients to your business.
If you would like to find out which social media platforms are right for your business, read our article, How to Choose the Right Social Media Channel for Your Business.
Offer New Products Or Services
Another way to diversify your customer base is to target new markets. You can do this by launching new products or services designed for the new audiences you want to reach.
This might require a considerable amount of resources to execute, so you’ll want to be sure that it’s something you want to do. Before going ahead with this, you should study the market and determine your chances of succeeding with it.
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Creating new offerings can be challenging. If you need some tips to make it happen, you’ll find them here: How to Build an Irresistible Product.
Be Deliberate About Networking
You may discover opportunities for acquiring new customers by discussing what you do with other people. Networking sessions often birth profitable partnerships, and open doors into new markets for many businesses. You should take them seriously if you’re eager to expand your customer base.
But this isn’t just about talking with other attendees at the corridors of a conference or exhibition event (although these are great places to find opportunities). It’s also about being open to making valuable connections wherever they may be found—including the most unlikely of settings.
Nurture your relationship with the contacts you’ve gained through networking. They could yield a lot of value for you, either by becoming your clients or pointing potential customers in your direction.
Testimonials are positive opinions about products shared by people who have used them. They are a great tool for attracting new customers—and diversifying your customer base.
It’s easy to see why this is the case. Potential buyers of a product or service will be more convinced by testimonies about it than by the words of its salespeople. That’s because the testifiers are typically people just like them (the potential buyers) who presumably don’t stand to gain anything by speaking positively about the product.
You can request testimonials from your existing customers, and use them as part of your marketing content (whether online or offline). People who see them may be inclined to try out your product.
The journey to diversifying your customer base begins with getting deliberate about gaining new customers. You will have to reach out to them with the resources and channels available to you.
Ask your existing customers for referrals, attract new ones with testimonials, ramp up your networking, and intensify your engagement with your target audience online. These steps could help you get clients, and reduce your dependence on the ones you currently have.
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