In every town, there’s a place where new business hides.
If you can’t find its hiding place, your business is likely to struggle.
Most of the time, that struggle is rooted in the inability to dependably produce predictable, month to month revenue.
Without predictable month to month revenue, businesses close, scale down or at the least, fail to reach their potential to support their owner, their family, their employees’ families and their community.
Revenue consistency problems influence a business owner’s decision making because their decisions end up being driven by cash flow. Decisions based on sales you made last week (much less yesterday) rarely fit into a long-term strategic plan.
Predicting revenue isn’t all that difficult. You simply have to check the Sales Thermometer.
What’s a Sales Thermometer?
Imagine that there’s a thermometer on the front door of businesses and homes that told you to pull in and sell something to someone because they had developed a need or a want that *had* to be fulfilled.
Armed with a town full of sales thermometers, you’d have all the new business you’ve ever wanted and wouldn’t waste a bit of time chasing around town after people who didn’t want or need what you sell.
Instead, you’d simply drive through town, check the thermometer and stop at the places where the temperature was the highest.
On days when you need a little extra revenue, you might get up a little earlier and drive around a little later so you could check more thermometers.
Once you took care of the places with the hottest temperatures, you could retrace your steps, scan for the next highest set of temperatures and take care of those sales.
As the sales thermometer readings change on other homes and businesses, you’d see them during your travels so you could pick up on the newest opportunities for new business – simply by being observant.
There is a downside to this sales thermometer thing. It has some scalability issues.
For example, you can only drive so far in a day and every customer who takes an hour of your time consumes an hour that you can’t use to check other thermometers. That will eventually force you (subconsciously at least) to stop and work with only the hottest thermometers.
If only there was a way to automatically check the hottest thermometers without spending all that time driving around.
Fortunately, there is.
Getting new business isn’t a joke
While talk of a sales thermometer seems like a bit of a fantasy or even a joke, your business’ inability to consistently produce new business from existing and new clients is no joke at all.
If your business struggles with that, the problem isn’t the lack of a thermometer. The problem is that you aren’t reading it.
The sales thermometer in the information you should already have about your clients and prospects. The thermometer’s temperature is driven by behavior and interaction, both yours and that of your prospects and clients.
Those behaviors are like a patient’s symptoms. Monitoring and acting on them in a predictable, repeatable, systematic way is what gets your business to the point where you *can* produce consistent, predictable month to month revenue.
Random revenue from new business is an indication that you’re not watching and acting on these symptoms on a consistent basis. We all know we need to do these things, but sometimes we get sidetracked by the crisis-of-the-day.
While they should be acted on individually for each prospect or client, these symptoms should also be grouped together (aggregated) to help you monitor the health of your business and your market.
Things that drive up temperatures
What causes rising temperatures?
- Interaction behavior changes. You should know when someone is paying more attention than a typical prospect. Do you have a way to detect this?
- Sales cycle behavior changes. You know how long it takes to close a sale. Is that timeline changing? Are certain prospects skipping steps in the process? Is their path-to-purchase pace is faster than normal? If so, does your internal behavior toward those prospects change to suit their timeline?
- Purchasing behavior changes. For example, customers who are buying more (or less) often than they normally do. Even if you’re tracking sales on paper, you can monitor this .
Are you monitoring the sales thermometer?
Small businesses are always interested in getting more new customers, but sometimes forget that keeping existing customers is less expensive than the cost of replacing them.
While products, services and customer support are critical to the health of your business, it’s critical to maintain a strong connection with your customers through properly timed communications.
Tending to this connection and nurturing into a relationship is critical to the health of your business.
Think about the businesses you frequent most often. Do they communicate in a way that encourages trust, doesn’t waste your time or take you for granted?
These things build a good business relationship just as they do a personal one.
Five words can help you stay focused on helping your small business prevent lost customers and improve the quality and effectiveness of your communication with clients.
Despite the obvious need to stay in touch or be forgotten, most businesses fail to setup a consistent, cost-effective system to collect contact information from their customers.
10 years ago, most people would give up their contact info much more readily than they will today – and for good reason. Combine spammers, data breaches by hackers (or data shared by them) and the all too often inappropriate use of customer data, your clients have plenty of reasons to have second thoughts about passing along their contact info – even if it’s nothing more than their email address.
These days, it has to be worth it to let you into their email box, even though it is (usually) easier than ever to leave their email list.
Think about the last time you gave someone your email address. Did they treat it well, thus appreciating that you allowed them to email you? Did they abuse the privilege? Did they send info that clearly had nothing to do with you, your needs, wants and desires – or did they nail it?
Imagine how much trust it takes for them to give you their full contact info. Are you honoring that trust? Given the data breaches in the news these days, this is a taller order than it used to be.
Most small businesses don’t communicate enough with
their present customers in multiple, cost-effective
I say multiple because what works for one doesn’t always work for another. If you have a great Android smartphone app to communicate with your customers, where does that leave customers who own iPhones? What about customers who don’t have smartphones?
Different people favor different communication media because they retain info better in their media of choice, be it direct mail, a blog, a smartphone app or a podcast. If you don’t make it easy and convenient to consume, you’ll automatically prevent some people from receiving your message – no matter how urgent or important.
Most small business owners don’t know when they’ve lost a customer, and even when they do, most don’t communicate often enough with these “lost” customers via cost-effective methods.
Without up-to-date contact info and valuing your former customers’ time, your message either fails to reach the person or is of so little value, they ignore, unsubscribe or worse.
What could be worse? They forget you ever existed.
Do you keep your customer list clean?
Clean means you deal with bounced emails, returned mail and bad phone numbers so that your contact attempts get to the right place. For communications that require an investment, this helps make sure the money you spend actually gets the message delivered.
Do you communicate to different customer groups with a message fine tuned for their needs, wants and desires – or do you sent the same message to everyone?
Many small business owners waste a tremendous amount of time, goodwill and/or money contacting their entire client list rather than using finely tuned advertising and marketing, which keeps costs low and skyrockets results.
Even if you don’t use direct mail, there’s a lot to lose if you don’t make sure the right message reaches the right people.
How many times have you received a great “new customer promotion” deal even though you are a customer of that company? What messages does that send?
Proper communication is essential – and it’s far more than broadcasting your message to anyone with a heartbeat.