A few months ago, I did some advisory work with a team of entrepreneurs running a fast-growing internet sales business. They were adding new customers at a rate of 10% a month and loving every minute of their success.
Unfortunately, they were burning cash. They were also losing existing customers without even noticing. The good was covering up the bad. In their drive to capture new business, the organization was failing to keep existing customers happy. Out-of-stocks, late shipments, and a lack of a customer retention effort were sucking the life out of their amazing sales progress.
These guys were the embodiment of the business metaphor of a leaky bucket. Imagine that each new customer is represented by a drop of water added from the top. The problem is that there are holes in the bucket that slowly let drops of water (customers) escape. While every new drop is exciting, the most important goal should be to keep the bucket full. That’s how to grow.
It is much easier to sell more to your existing customers — who know and trust you — than it is to develop new relationships. Think of the lengths you must go to in order to get a meeting with a new client, compared to the ease with which you can call up a longtime partner and chat. Don’t mess things up with missed shipments, product defects, or customer service flaws. Pay attention to your existing customers and work to keep them happy and in your bucket. It is way more fun to have fewer holes than it is to try to plug them.
The most important customers are the ones you already have.