How To Target The First Time Customer

by Tom Egelhoff

Most business experts agree that it costs a business six times more to attract a new customer than it does to retain a current one. But here in Montana that may not be entirely true. Montana towns have a much higher turnover of residents than most other states. We have a low per capita of income, sparse population and some pretty challenging weather from year to year that cause people to seek opportunity elsewhere. According to local figures, my hometown of Bozeman turns over in population every seven years. So even if you are the best business around there is a constant influx of new customers up for grabs at any given time. So what's the best way to bring in "new blood?"

There are only two ways a business can bring in new customers. Steal them from your competitor or develop a brand new customer that has never used your product or service before. For example, a high school student turns sixteen and gets a drivers license. The student is now a gas station, tire store, auto repair, car wash, and oil and lube customer. This one person affects a lot of local businesses just by being a new customer to the market.

I would make the following suggestion to every retail business owner reading this column. Have a yearly "Grand Opening." When I moved to Bozeman 10 years ago I had to find all sorts of goods and services. A grocery store, shoe store, dentist, auto mechanic, and the list goes on and on. New people are invading your town daily and any time a new business opens the natural urge is to go take a look.

A yearly grand opening does two things. It alerts new residents that your business exists and it also reminds some old customers you may have lost that you are still around and better than ever. If you are a seasonal business like a ski shop of bike shop you would plan your "grand opening" just before your season begins to capitalize on the peaking interest. Budget this expense into your advertising and marketing plan each year.

The most important aspect of this to remember is that good planning is the key to success. You never get a second chance to make a good first impression. Your employees and sales people have got to be at their very best. Make sure you have enough salespeople and inventory to satisfy demand. Take a tip from restaurants that have an unadvertised "soft opening" to work out all the kinks and problems before the actual Grand Opening takes place. You are trying to turn first time customers into lifetime customers. This is much more than a one shot deal so make the most of it.

If you are concerned about your level of customer service you might consider one of the "mystery shopper" companies. Or use friends or relatives to give you feedback on what you might be overlooking. Remember word-of-mouth can make or break a small town business so make sure your customers are sending out positive words about you.

I would also suggest bringing in a group of your best customers and ask for their feedback. Put them in charge for an hour or so. What do they really like about your business and what would they change if they could?

Learn about your industry to get some free publicity. For example October is small business customer service month. Its also "pizza month" Last October Pizza Hut send out press releases with pizza facts from around the world that got people excited about pizza. Can you tie national days or months to your annual grand opening and get some coverage in the paper, radio or TV?

Use co-op money to help defer some of your promotion costs. Bring in industry experts and suppliers to educate your customers and give your business more credibility. In many cases they will have promotional give away items you can use as freebies or gifts for drawings. Perhaps you can barter your products and services for newspaper, radio or TV time.

Last but not least, don't forget gift certificates. When you have a store full of people this is the best time to promote them. Use your promo traffic to bring in more traffic. If you have a web site make sure that you also promote it there. Take pictures of your packed store and post them online to build future business. If you have customer testimonials have them framed and placed all over the store for browsers to see.

You can't have old customers until you bring in new ones so get creative and bring em in.


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