It has been a year since I left my "normal" job to start my own company. June 15th, 2010 was my first day I no longer had the security of another company paying my salary. Looking back I don't know I would have had the guts to start my own company if I would have known how challenging it would be, I was over definitely over optimistic on how easy things would be. If I would have known the realities I know now, I probably would have chickened out. Building a customer base has definitely been more challenging than I expected. I quickly found out that selling a service where engage with a business as adviser on an ongoing basis is much harder to sell than hard goods or commodity services like internet service. But after a year I have a small group of clients that I feel good about. I would not trade running my own company for anything. I am still shocked at how I have been able to build a customer base in a single year, given when I started I did not know how I was going to land customers. This blog article is a review of what approaches I tried to obtaining new customers, which ones worked and which ones didn't.
Below are the totals of my results from trying to obtain customers for my services of getting business to business, small businesses more customers. As part of this service I help them with their sales and marketing plan. Developing the plan and then executing it. To understand better what the service I provide go to my new customer generation page.
Year One Results
Prospects = 24 (Note: I define a prospect as someone I met with 1x1 to discuss my services.)
Prospects That Did Not Fit My Strategy = 9
Prospects That Declined My Services = 6
Prospects That I Am Close To Signing = 2
Total Customers = 7
Active Paying Customers = 4
Customers Terminated = 3
Customers Lost = 0
Total Hours Prospecting = 354.4
Year One Efficiency Results
Closing Rate = 37.5%
Closing Rate Of Prospects With Strategic Fit = 50%
Time Required To Generate A Prospect = 14.8 Hours
Time Required To Generate A Customer = 50.6 Hours
Time Required To Generate An Active Paying Customer = 88.6 Hours
The Review Of My Results
Well now I have a benchmark to improve on for next year. From what I have learned I should definitely be able to improve these metrics over the next year. By the end of next year I am targeting a time to generate prospect of 7 hours, time to generate an active paying customer of 40 hours and a closing rate of prospects with strategic fit of 75%. I am very happy though that I obtained a closing rate of prospects with strategic fit of 50% as I believe most industry reports would say the average closing rate is 30-40%, so to be above the average in year one I can't complain.
Ways To Get New Customers That I Tested
I tried a multitude of different methods to attract new customers. The list includes
1. Visiting businesses door to door
2. Emailing business owners I found online (looking back I don't know why I even tried this)
3. Attending networking events
4. Contacting small business owners who had posted job postings for a marketing position
6. Blogging on other websites
7. Video Blogging
8. Cold Calling
9. Pro Bono Work
14. Writing Articles On Article Sites
15. Work For Other Customers
I was going to go into the detail of time spent, dollar cost and what I learned by each tactic but I realized this would turn into a monster sized blog article. I think I am going to have to save this for another article. Check back here in a few days and I should have the results up.
What I learned from this year's experience generating customers for my business is.
1. Generating new customers is hard. Getting new customers for a service where you act as a trusted adviser on an ongoing basis is even harder.
2. Not all customers are good customers. If you terminate customers that are not on strategy you end up coming out farther ahead.
3. To be great at getting new customers you have to offer something that is impossible to refuse. If you can convince the prospect what you will provide is of significantly more value than the cost, they will be eager to become a customer.
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My name is Chris R. Keller. I work at Profitworks Small Business Services helping various B2B small businesses in Waterloo and Kitchener Ontario generate new customers. If you are interested in generating new customers for your B2B small businesses enter your email in the box provided below and click the "Send Me Free Updates" button.
I hope reading this article will encourage you to get new customers. Thanks for reading.