Growing Your Business without Breaking the Bank

As a small business owner, you face a conundrum: you need new customers, but may not have the know-how and resources to acquire them. You could hire an expert to do it for you, but this option can become costly. Or you can do it yourself, with a little help from an information solutions provider and the Internet.

Here are some basic marketing strategies to simplify the customer acquisition process, save money and build successful customer relationships.

1. Determine who to contact. Knowing your audience is the most important aspect of your direct marketing efforts. Strategies for identifying and contacting the right prospects include:

* Look for people who fit a matching profile for your ideal customer. While targeting customers within a short proximity of your location works, you may want to market to a larger audience. To do this, filter your prospects by age, marital status, income, etc. For example, if you’re a financial planner, only contact those with $50,000+ yearly income.

* Timing is everything. If you own a home supply store, the best time to solicit leads is when someone moves. While purchasing highly targeted lists can be expensive, they’re likely to garner the best response rate and profit. Don’t be afraid to use the most expensive lists because they bring the most profitable and loyal customers. You can purchase a targeted mailing list at www.marketshareonline.net or www.experianbizinsight.com.

2. “Do Not Call” doesn’t mean “Do Not Solicit”. If you’re like many small business marketers, you may not understand what Do Not Call (“DNC”) means. While DNC eliminates the ability for telemarketers to make cold calls to those on the national DNC Registry, you don’t have to be shy about contacting consumers you have an existing business relationship with for up to 18 months of their first interaction with your business. If someone calls you for a quote – even if they haven’t purchased your product or service – you can call them for up to 90 days, irrespective if they’re on the DNC Registry.

It’s important that your telemarketing efforts are compliant. Screen your list against the national DNC Registry and register with the FTC at https://telemarketing.donotcall.gov/. You also may want to check relevant state telemarketing laws in your area. For more information, visit www.experian.com/donotcall.

3. Don’t waste money. The last thing you want to do is waste money. While you don’t need to buy a million dollar CRM tool to practice good customer relationship marketing, you do need to identify your best customers and manage them according to how much value they will bring your business.

* Know your best customers. Look for individuals who are likely to be loyal, long-term customers. While a customer spending $500 may seem better than someone spending $100, analyze other factors, such as number of items purchased over what course of time. A one-time customer spending $500 two years ago may not be as promising as one who spends $100 monthly.

* Focus on building relationships. Send your customers thank-you notes within a few days of purchase. Showing your appreciativeness and thoughtful attitude will bring back those customers time and again. The first sale is the beginning of the relationship and you want to get off to a good start.

* Don’t give away the store. Think about ways you can nurture the relationship by offering value-add services without discounting merchandise or services through markdowns or coupons. Offering discounts only trains your customers to expect discounts. Instead, offer incentives. If you own a local craft store, give customers a value-add, such as a free jar of paint with their next order. This encourages them to visit your store, but avoids training them to buy as a result of a discount or coupon.

* Limit general advertising. While direct mail is expensive, it’s really more expensive to purchase broadcast advertising. A wider reach doesn’t equal a larger number of customers. While broadcast can help you build brand recognition, it doesn’t necessarily ensure a response. Instead, shift advertising dollars to direct mail – it’s more targeted, measurable and effective.

* Look for postal discounts. If you mail a minimum number of direct mail pieces, you may be eligible for postal discounts. Consider using Zip+4, which means you add the four digits at the end of each zip code to your mailing. You also can get steep discounts by sorting your mailing by Zip+4.

Finding new customers doesn’t have to break the bank. There are many simple and cost-effective ways you can grow your business and save money using direct mail. Remember, you don’t have to go at it alone. Consult a list broker, ad agency or visit the Internet sites referenced in this article to help you find the best solutions for your business.

Roy Wollen is Director of Access and Delivery Systems, Experian Marketing Services. He can be reached at roy.wollen@experian.com.