Posted by: Andy Porter | December 30, 2010

Internal Marketing – 16 Simple Steps

Marketing efforts can be divided into two categories.

External Marketing denotes all of the actions you take to attract new customers. External marketing includes such things as your sign outside, your web site, attending Chamber meetings, all advertising and… well the list is very long! The purpose of external marketing is to let people know that you’re there, what services or products you offer and to entice them to visit your web site or come in, call or in any way reach for services/products.

Internal Marketing includes all of your actions to maintain a relationship with someone who has already purchased your product. Letting existing customers know about an upcoming sale is a common and narrow use of this type of marketing. A comprehensive internal marketing program includes such things as customer service surveys, providing educational information, showing the customer that they ARE important to your company and is simply a way for a company to maintain communication with their customer base. Of course the purpose of this is to increase sales, but effective internal marketing also improves word of mouth, increasing referrals.

Sometimes marketing actions overlap, reaching both “old” and “new” customers at the same time. For example collecting toys or food and donating them to a food bank or community center involves and interests your existing clients and if made known in your community will also attract new customers. Any internal marketing program that creates good will or educates or improves service will improve your customer’s loyalty and so increase positive word of mouth for your business.

It is a mistake to not balance these two marketing functions. Actually your external actions will bolster your internal programs and vice-versa. Focusing too heavily on one area while not developing the other can be detrimental.

One example of this is “new client packages”, where the new customer is offered a package of services at a MUCH lower rate than the existing customers receive. This often offends your existing customer base, possibly motivating them to leave your company so that they can come back and be a “new” customer!

Basics

Here are some internal marketing statistics:

  1. It costs, on average, 6 – 10 times more to acquire a new customer than to keep an existing one
  2. The average organization loses 50% of its customers every five years; and the cost of replacing them can be six to seven times more expensive than winning them in the first place.
  3. Studies have proven that a mere 5% increase in customer retention can result in profit increases of at least 20% (and as much as 80%) for most businesses or, that repeat customers spend an average of 67% more than new customers. Additionally, after 10 purchases, a customer may have referred as many as 7 people.
  4. Studies show that the average business loses 20 percent of its customer base each year.  For example, let’s say your business has 700 customers that buy repeatedly from you during the year and each customer spends an average of $300 a year. If you lose 20 percent of them (one hundred and forty), you’ll loose $42,000 a year. That’s a lot of money to make up with new customers.

Of course all of these numbers and percentages vary from industry to industry and from region to region, but the general idea is that most of the income a business receives is from existing customers and keeping them happy is of the utmost importance.

Internal Marketing targets your current or past customers. It keeps your customers connected, lets the customer know that you haven’t forgotten them and that you care about them, and provides an opportunity for you to let your customers know about new products, services, equipment and so on.

Per my own surveys with thousands of people the number one reason they are loyal customers to any provider is related to personalized service. Some one remembered their name, or their likes, or some detail about them.

An effective internal marketing program is a very effective way to create and maintain a personalized relationship with your customer base.

Keeping track of your customers

Creation and maintenance of your customer database is of HUGE value to any business. A customer database lets you keep track or people who bought from your company:

o       Recently, or based on time

o       Volume or frequency of purchase

o       Types or selection of products

o       Total yearly or lifetime purchases

o       Location, city or zip code

Creation of the database is not the topic of this article, but I will make a mention about maintaining the accuracy of the contact information of your customers. Obviously having just a customers name and no contact data is not of much value. All businesses large and small MUST create and follow simple protocols to make sure that customer info is correct and up to date. Contact info can be updated on line, over the phone or when ever a customer comes into the office, store or what ever.

Regular mailings (every three to six months) ensuring that you will get back address corrections is vital if you plan to use your date base for regular mailings. Marking “Address Correction Requested” ensures that if the customer moved and filed a forwarding form with the post office that you will be able to update your files accurately.

This area is sometimes overlooked, in many businesses no one is watching to ensure that the database is up to date and being corrected regularly. Noting is a bigger waste of effort and money than to be sending your message out to no one!

In my experience there are no internal marketing actions that work for everyone or work everywhere. Every type of business is different. They have different types of customers, different needs, wants, etc. Not only that but even in a single industry, say Auto Repair, or Dentistry, so much varies from region to region that you just have to try things and see what works for you and your customers. What is workable in Mobile, Alabama may not get any results in Aberdeen, Washington.

Here is a list (in no particular order!) of some internal marketing actions that can be used.

  1. Sending out Birthday cards, either by mail or email, congratulating the person and possibly offering a free product or service. People (usually!) like to have their birthday remembered and (always!) love birthday gifts.
  2. Creation and distribution of business cards and business card size magnets matching in look and feel to your web site.
  3. Regular mailing of “Most Commonly Asked Questions” postcards to active and inactive customers.
  4. Personalized letters to customers/clients/clients from the mechanic, doctor, instructor and or staff. Topics such as How did we do?, Was there anything wrong, Follow up letters (how is the car running?; how is Fluffy’s foot doing?, etc). These can be typed and then signed personally.
  5. Creation and publication of newsletters, educational materials. Any information that could be of practical use to your customers. These can be distributed on your web site, through email, or mailed out regular like.
  6. Client, Customer Appreciation Day or Week. This is a good bi-yearly idea. For one week have home-baked cookies, offer free drawing tickets, give away stuff, spruce the place up and plaster the place with stuff saying how much you love your customers.
  7. Holiday Decorations! Every Holiday is an opportunity for getting decorated! Christmas, Halloween, July 4th, etc, are great reasons to go crazy and decorate. Staff love it, and it makes things fun. Customers can tell when the staff are having fun! Don’t forget to decorate your web site!
  8. Do annual or semi annual food or toy or shoe drives. Collect and donate any useful item. Staff always love this program, your customers love donating and if you contact the local paper they will cover it and your name will get out into the community. And besides, its FUN!
  9. Referrals through a rewards and validation program, dinners, movie tickets. First you need to have an effective method to find out how every new clients came to your business, then if they were referred to you, ask who referred them, and then give the referrer a reward, either credit their account, or give any award that fits and is legal!
  10. Open House, can be done yearly. An Open House does NOT have to be an expensive affair, decorations and food can be done on a budget. Any reason can be used for an Open House, a yearly anniversary of the business, getting new staff, new equipment, etc.
  11. Workshops and client education lectures. Offer free or low cost lectures or workshops for existing clients (and non-clients). The lectures can be about flea control, auto maintenance, teeth whitening, etc. They can be done after hours, or anytime.
  12. Gift certificates for holidays. Create them promote them sell them!
  13. Success Story/Client Testimonial Campaign – success stories collected from your clients and place in a binder or on the wall in your reception, waiting area or treatment rooms. Use the testimonials on your web site, include them in news letters, review them for ideas of what to write about how great you are!
  14. Educational T.V., Videos playing in the waiting area to educate clients. These can be annoying if poorly done, but can be very useful if they are educational, not just about a sales pitch.
  15. Follow Up Calls. Calling a client, customer, patient, back to see how they are doing is an AWESOME way to improve word of mouth. Follow up calls, done correctly, show the customer that you genuinely care about the product or service that was provided, that you care about the customer and that their complete satisfaction is important.
  16. Customer compensation when things go wrong. Every company has things go wrong with clients from time to time. Be sure to have on hand some form of compensation ready. I recommend buying $100 worth of $5 coffee cards, and also movie tickets, or restaurant gift cards and have them on hand to give out. I say have three types and values for the various levels of how badly you may have messed up (or how irate the customer is!).

Click here for more information about WelcomeTeam Training!

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