“How do I get new customers?” is one of the questions many small businesses owners ask. Aside from the traditional marketing or individual customer referral approach, there is an often overlooked but very effective way of customer acquisition that I’d like to talk about today – forming “host-beneficiary” relationships.
The concept is simple, forming “host-beneficiary” relationships with established non-competing businesses that have target audience similar to yours, by offering their customers a deal without any cost from the established businesses. The great thing about it is that while established (host) businesses gain goodwill with their customers, beneficiary businesses instantly reach large numbers of highly qualified prospects. Win-win. For best practice, follow these six steps:
1. Create your target customer profile. Create a detailed profile of your target customer, including geographic, demographic and psychographic elements, such as age, gender, habit, attitude, value, etc. The more specific it is the better.
2. Identify local businesses that serve the same market segments. Really tap into the mindset of your target customers and think about what they need and where they go. The more segments you can identify, the more potential hosts you can approach.
3. Develop a good offer for the potential customers. Come up with an offer that has a high perceived value for your target customer, but doesn’t affect your bottom line too much. For example, free gift, coupon, free trial, buy 2 get 1 free, etc. Make your offer enticing with a call-to-action message.
4. Make your pitch to the host businesses. To get them on board you have to highlight what’s in it for them. Emphasize that it’s a way for them to reward their customers at no expense and with virtually no effort.
5. Rollout the plan. Whether it is an Ad in their flyers or an offer in their monthly e-newsletters, follow through according to the agreement.
6. Convert new customers to loyal customers. When new customers come to you for the first time, make the experience count and deliver good customer service. Add them to your database for ongoing communications and build relationships with them. Aim to turn them into repeat and eventually loyal customers.