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where you focus on decreasing churn numbers via relationship, education, events, etc., and focus on upselling your existing customers so their additional spend makes up for any loss in revenue from the cancelations you can’t save (circumstances outside of your control). BUT ALMOST NONE DO How big would your company be right now if you’d NEVER LOST A SINGLE CUSTOMER in all the years you’ve been in business? THE ONE GOAL EVERY BUSINESS SHOULD HAVE,
As a responsible business owner, there’s a lot you have to keep track of. Knowing your numbers is imperative if you want to grow your business, because you can’t grow if you’re hemorrhaging money to an ineffective social media marketing campaign or a direct mail piece that’s missing its mark. But have you ever wondered if there was one goal or key performance indicator (KPI) that is more important than all others? When posed with a question about the numbers, you need to stop and consider: What do big companies focus on? Is there one single metric that, if you could nail it, would literally mean millions and millions in extra revenue and profit for any business? The good news is, there is a single goal to focus on. And if you choose to make it a priority, it will revolutionize your business growth and jumpstart your long-term success. But before I share this one goal, I want to ask you a question. How big would your company be right now if you’d never lost a single customer in all the years you’ve been in business? Let me answer first. I’d likely have additional sales of 7–8 million annually, maybe more. The problem with this is, we all lose customers. You can utilize media like a newsletter to build relationships and decrease the number of lost customers each month and year, but never, ever losing a customer just isn’t possible, right? No matter how good your customer service is, or how amazing your product is, there will always be customers who leave because of their own financial situation, a change of mind, or a simple misunderstanding of what it is you can do for their business. Now you’re thinking, there is a way to not lose money simply because a customer chooses to leave. This is the Utopian goal for any and all businesses and is referred to as “revenue-neutral churn.” Simply defined, revenue-neutral churn is
Of course, getting to revenue-neutral churn is not easy, and in a few business models, may be impossible. But what if you could get to the point where only 10 or 20 percent of the churn affects sales numbers? The growth for your company would be incredible. To have a chance at revenue-neutral churn, you first have to focus on all areas you have control over that cause customer attrition. You can control the customer experience, the value your products or services add to your customers’ business, and the relationship you build that creates customer loyalty. A few ways to better these areas is to implement relationship marketing, pre- and post-sale education (via webinars, articles, MP3 recordings, etc.), becoming an expert advisor in their lives, and having a continual upsell system to help them solve additional problems they may be having. If you really want to grow, it’s unlikely you need more leads, though that is a common falacy. Instead, consider how you can grow simply by decreasing churn. You can grow by upselling the customers you already have. You can grow by
building a relationship and follow-up system that helps you convert more prospects to customers.
So why don’t more businesses simply focus on the above areas of their business? The answer is simple, really. All you hear about is the “sexy” side of business — new customers, more leads, etc. — so that’s what everyone focuses on. The reason you hear so much about new leads is because it’s much easier to sell new. But new isn’t necessarily what’s best for you or your business. In fact, it’s not the primary growth factor for us here at The Newsletter Pro. If you really want to grow, focus on the goal so many of our big brother and sister companies focus on — finding a way to get to (or as close as possible to) revenue-
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neutral churn. Do that, and you’ll be swimming in cash in no time.
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