- March 30, 2021
- Posted by: Peninah Anyango
- Categories: Brand, Business, Business plans, customer Service, Digital Marketing, Marketing, Sales, Strategies
Did you know that 25% to 40% of the total revenues of the most stable businesses come from returning customers? Repeat customers drive 3-7 times the revenue per visit as one-time buyers. Therefore, it is important for businesses to recognize the need to retain their existing customer while working towards acquiring new ones. In addition, a business that is knowledgeable of the customer journey is a step ahead of its competitors, hence the need to understand Customer Development and Acquisition processes. Source
Customer Development Stages
- Customer Discovery:
This is considered the first step of the search phase. It involves questioning your core business assumptions. As a business, you will construct your hypotheses and get out of the building and you start testing your assumption about
whether other people have the same problem.
- Customer Validation:
Also known as Product or Market fit, this is the stage where you will see if your proposed solution actually matches what you think the customer problem was. Businesses search for the business model until they find a repeatable and scalable one. Therefore, research must be thorough and correct.
- Customer Creation:
This is the third step in the Customer Development Model. After you have validated who your customers are, it is in order that you invest in targeted marketing to reach a wider range. At this stage, the goal is to create end-user demand and scale.
- Company Building:
Once you have understood and established who your customers are and are aware of how to sell to them, the business can easily transition to a full business. One can now think of formalizing departments. Your business can now transition from customer development to a functional organization that’s oriented to constant and
Customer Acquisition (CA)
Customer acquisition refers to the activities and actions a company takes to gain new customers.
- Identify your ideal customers
- Define your goals
- Choose your customer acquisition channels
- Develop a unique strategy for each channel
- Communicate with your customers
- Measure and improve your strategy
Once you understand the customer development and acquisition process, you will automatically know how to value your customers. In turn, this creates customer loyalty and causes the customer to frequent your business regularly, increasing profits for the company. If the experience was a bad one, the customer will take their business elsewhere.
With increased competition in business today, it is important to keep a strong customer base in order for the company to grow its profits. Moreover, “Word of mouth” is a powerful way to communicate with other potential customers.
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