Who is potential customer?
A-market consists of all potential customers sharing the particular needs and wants who may be willing & able to engage in swap to satisfy that the needs or want.”
In the many of businesses, the smaller-sales can be highly-profitable, while larger-sales can cost of the company a lot for administer and deliver, & therefore have a smaller-profit-margin. A laser like the focus on these high profit buyers is also preventing from the expending too-much effort on lower-profit customers.
Use these steps to track the highest potential customers
Calculates the acquisition costs
For assess the customer’s profitability, you needs to determine, how much cost of your business for attract each-customer. Several small-businesses will be able to get-away with the cost of sales-analysis i.e. much simpler than, what larger-companies use. Keep in the mind that cost of sales-numbers produced by these calculations are averages, to use to rough the evaluations of the customers-base. For conducting the simple-analysis, the first review effort included in closing a typical-sale. Be sure to-include the expenses like a direct mail, salesperson, Website development & other advertising costs. Estimates the total-cost of your outreach & divide it through the number of the sales you close annually to do a ” dirty or quick ” analysis.
Calculates the cost of customers services
It’s a vital part to track your customer’s services expenses to measure, how profitable you’re current customers from. Equation is similar for the cost of sales-analysis. Apply- costs for the service related items such as the order taking personnel, project-manager-salaries or delivery of your products or services to each-customer. Estimates the average- cost of servicing, each customer through dividing by the-number of customers you serviced during the-year. If you required help determining the key services expenses in the industry, ask your-from accountant to industry-standards. Keep in mind that cost of the service-numbers produced by these calculations’re averages, to be used to very rough-evaluations of the customers-base.
Creates a high-potential profile
You-can use this information for develop the profile of your high potential customers. Look for a common characteristics or behaviors. Do they-fit into a specific demographic and geographic category? Do they makeing their buying-decisions in a similar channel? This profile will helps you to develop the most-effective marketing-programs to reach these objectives, and extend their values for your company, or attract more high profit-customers.
Few businesses may want to go a further step & develop the customer’s potential pyramid, a three segments hierarchy that breaks-out the company’s high potential, medium potential, or low potential customers. The main intension of this profile is to look for marketing-tactics to migrate the customers into high profit categories.
Re-allocate the efforts arround least-profitable customers’
Re-view your records for those customers’; who cost you valuable-time or money & creates a profile of them in same channel you built a high-potential profile. To degree you can, sure that the marketing-programs exclude those customers, for keep you’re efficient or profitable.