"Business development and Marketing"; ?>

It is common practice for companies of all sizes to survey current and past customers to check performance, to see what they like and dislike about services or products, and to pre-test new ideas before investing money in development or production. But how often do you survey your ‘non’ customers – the potential customers that never choose to buy?

In relation to overall marketing effort, the majority of companies spend the majority of their marketing budget attracting potential customers, or leads, to their business. After you attract leads, the sales process kicks in and a certain percentage of those leads will become customers. This percentage is your ‘lead-to-sale’ conversion ratio. Depending on the business you are in, you may convert just one in 100 leads from a direct mail campaign, or you may convert two out of three from personal referrals– the ratios will be unique for your activities and your company.

Let’s think of a simple scenario. Each week you spend $250 on Google Adwords to generate leads for your product. Those ads bring in 100 enquiries each week and your current sales process converts 10% into customers. Each customer represents a $100 sale ($1000 per week), so your return on investment is 4:1 – this may be considered a reasonable result, and from this tactic alone you will bring in $52k per annum for an investment of $13k.

Let’s think about this a little more. One hundred customers took the time to respond to your advertising; they liked what they saw and they requested more information. Gaining attention for your business is one of the toughest battles to conquer, so you are doing something right with your promotion up to this point! Now for the reality check; nine out of 10 customers chose NOT to buy from you, so is this really such a great result after all? Imagine that instead of only converting 10% you could change your sales process just a little so that you doubled that figure. For that same $13k investment, you now produced $104k revenue per annum! An 8:1 return on investment sounds pretty good to me!

So how do you know what to change? Simple; ask your ‘non’ customers why they didn’t buy. Ask them what attracted them to your business, did you offer the services or products they were after, are they still in the market or have they purchased elsewhere (this answer can be used for competitor research as well as for a ‘stay-in-touch’ email campaign or similar), was the pricing ok, what is/was their timeframe for purchasing, was there something you did or didn’t do that turned them off, did you make it easy to purchase from you or were your processes too complex? Perhaps your advertising messages are attracting the wrong customers in the first place – that would be something worthwhile to find out as soon as possible. There are a multitude of questions and answers that will be right for your business and, depending on what you learn, you may find that a few simple adjustments to your sales processes or communication messages could mean the difference between $52k and $104k in revenue from just one advertising channel. Imagine your results if you did this for all your activities.

So next time you think you need to spend more money to attract more leads to your business, think again. Make a small investment of time instead to find out why people didn’t buy from you, and think about what a higher conversion rate will mean to your top line!