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Most UK businesses face the same predicament within the early stages of their development. Once that first lead has turned into a fully fledged project, how do you continue that momentum and attract more new customers to your business?
The following five tips aim to give you just a few ideas as to how you can capitalise on your first few customers 'through the door' and what other techniques you can employ to help grow your business.
1. Speculate to accumulate
It's a cliché, but like all the best clichés its completely true! One of the most painful aspects of starting a new business is that you have to pay out before you can get money in. The trick is knowing when to pay out and how much to spend. The answer to this riddle has been coined into a new business-buzz-phrase of 'due dilligence'; All this really means to you, the entrepreneur/business owner, is 'do you homework'. You need to know where to spend money and when to spend it in order to reach those elusive new customers. To spend your money wisely you need to understand your customer's needs and research them; think about where your new customers are, what they do, why they need your service and what budget they will have to spend to acquire your service. By thinking like one of your potential customers you'll prevent yourself from overspending on advertising or, worse still, advertising to the wrong audience.
With 'due diligence' you will be able to allocate your advertising budget wisely, spending only what you need in order to attract those fisrt few customers through the door.
2. Know your business inside and out
This may sound silly, but knowing your own business and what it is capable of achieving can be crucial to winning new customers.
Ask yourself if you understand every aspect of your product or service. Ensure you know what it does and be able to justify why. Many small businesses falter under the scrutiny of a prospective customer. Not only will the customer ask more questions about your service than anticipated but many may also not want to pay the amount you determined to be a reasonable hourly rate. By knowing how your product or service operates and the intricacies of your own budget you'll be in a much better position to either discount your price at an introductory rate or stand firm and explain to the customer exactly why your product demands such a rate.
Having a good 'product knowledge' can help you sway wavering new customers and entice them back to the table. Nothing says business confidence like being able to answer all the questions thrown at you in a concise and accurate manner.
3. Differentiate on service, not on price
One of the easiest things to do when starting a new business is to cut your prices in order to attract new custom. Don't do it! By using lower prices as your differentiation tactic your new customers may be tempted to choose between you and your competitors based on price alone. It's far better to use the differences and advantages of your product (over a competitors). By highlighting why your product is better than the others on the market you'll be in a much stronger position to justify slighter higher price.
4. Recommendations and follow up business
With that first new customer 'in the bag' it's now time to capitalise on the good customer service they received from you. Ask them if they know of other business in their sector (or related sectors) that could benefit from service. You may find that the customer is hesitant to give you the names of other businesses in case they too benefit from your product so try offering them a discount on repeat business. Not only will this help you to get a personal introduction to other customers but you'll also ensure that your original customer comes back to you time and time again in order to benefit from your slightly discounted rates.
"But you said 'differentiate on service, not price'!"
Indeed I did, and for new customers that is absolutely the case. But once you have a customer, it can be worth discounting your prices in order to keep them. Not only will this sweeten the deal for your customer, but it can also ensure that repeat business is forth coming.
5. Communication
The final tip is another business cliché. When trying to win new business always ensure that all customer queries are followed up promptly. This may mean working and extra hour or two each night in order to clear your in-tray or email inbox, but not responding to your customers is an easy way to drive them to your competitors.
6. Bonus Tip: Out source
If knowing how to advertise your business isn't your forte, or responding to all of those letters and emails is starting to interfere with daily tasks, consider outsourcing to a freelancer or hiring a new member of staff. The growth of many new businesses is stifled because administration tasks begin to encroach on the tasks that are making you money i.e. Project work for your customers. If you start to feel that your time isn't being used effectively and that the service your produce is suffering as a result, it's time to consider hiring an extra pair of hands.
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