I’m serious! If you want to grow your business, then cut your marketing budget. There, I said it again.
Last year, US businesses spent $500bn on marketing, and only $9bn on customer service. That’s a staggering difference.
Here are some more stats:
84% of customers expect you to let them down. We’ve become so used to poor service, that the overriding customer expectation is that we’ll be let down.
96% of unhappy customers don’t complain, and 91% of those will simply leave and never come back.
If you’re in professional services, clients are 4 times more likely to move to a competitor as a result of poor service than due to issues with product or price.
And so we keep on spending money on marketing. We need to replace the churn, right?
That’s not solving the problem.
If we want to fix the underlying problem, then we need to invest in customer service. And of course I’ll go further and say that we need to invest in the overall customer experience.
You see, good experiences make people want to do business with you. It makes them want to come back, again and again. It moves the dynamic away from price – we use price as a measure when service is poor, but when service is good, then all things being equal, it ceases to be an issue.
Customers that enjoy their experience with you spend more as a result.
Your profitability per customer increases.
And they tell people. They bring business in for you! They become advocates – your new sales force. And the best bit? It costs you nothing.
Stop Spending Money on Marketing.
Shift the needle. Stop doing what everyone else is doing. You don’t have to be that hamster on the wheel, constantly looking for new business to replace the customers you’ve lost. Instead you could:
- Invest in the Customer Experience.
- Listen to what your customers problems are.
- Deliver products & services that solve them.
- Make it easy, and pleasant, for them to do business with you.
It’s not rocket science, but most businesses don’t look at it like this. They don’t stop to think, they’re too busy trying to replace the churn.
So stop spending money on marketing. Grow your business instead.