ited in their methods of customer acquisition. Typically you should have at least three to four good solid ways to acquire customers and maybe more. This diversity in customer acquisition makes your company more stable and gives you a broader base of customers. It also gives you better information to steer your business to success due to the diversity of the customer base and feedback that will result. A common trap is to not understand each way has a real limit on volume and a very different acquisition cost too. Just because you can get a customer for $45 using direct mail does notAn excellent marketing guru and speaker I know says there are only three ways to grow your business: 1) More customers, 2) Higher average sales/revenue per customer and 3) A higher purchase frequency from your customers. Although this is a great model to divide and attack the problem, it is more a classification of categories of ways than actual ways to grow your company. Luckily we can come up with hundreds of ways to grow a business and the tough part is deciding where to put your efforts. One theory is that with ever growing sales and marketing costs it is usually easier to get more revenue from existing customers than to find new customers. Yet most businesses put more time and effort into customer acquisition than retention and upselling (#2 and #3). This varies greatly from business to business, and is a function of the actual acquisition costs of a customer, what else they might need when they need your product and many other factors.

Every business has lots more ways to look at within these categories. Odds are you can do something with most of these ideas eventually.

#1 - Identify your company’s weakest link and make it a strength - Every business has many limits, but usually one or two are more of a bottleneck on growth than the others. As each limit is taken away the level of success of the business can leapfrog. This is a great way to grow your business in steps. Often than not these limits are in the areas of sales and marketing, though certainly they can be anywhere. Minor changes in product and service positioning, or adding options can also have a dramatic effect. So one great way to understand this is to analyze your marketing and sales process, or marketing funnel. Each step, or level, has a cost and a leakage rate of customers that are lost at that level. Companies need to understand the economics of each of these steps. How much does each potential customer cost to get to each level in the process? When you understand these steps well the weak spots will jump out at you to work on. Typically sales and marketing people are not analytical types and so the CEO must drive this process. If you keep identifying the weakest spot and correcting it one to three time per year your company will grow.

#2 – Be willing to spend more to get a customer – Many companies I coach and consult with are very limited in their methods of customer acquisition. Typically you should have at least three to four good solid ways to acquire customers and maybe more. This diversity in customer acquisition makes your company more stable and gives you a broader base of customers. It also gives you better information to steer your business to success due to the diversity of the customer base and feedback that will result. A common trap is to not understand each way has a real limit on volume and a very different acquisition cost too. Just because you can get a customer for $45 using direct mail does not

revenue from existing customers than to find new customers. Yet most businesses put more time and effort into customer acquisition than retention and upselling (#2 and #3). This varies greatly from business to business, and is a function of the actual acquisition costs of a customer, what else they might need when they need your product and many other factors.

Every business has lots more ways to look at within these categories. Odds are you can do something with most of these ideas eventually.

#1 - Identify your company’s weakest link and make it a strength - Every business has many limits, but usually one or two are more of a bottleneck on growth than the others. As each limit is taken away the level of success of the business can leapfrog. This is a great way to grow your business in steps. Often than not these limits are in the areas of sales and marketing, though certainly they can be anywhere. Minor changes in product and service positioning, or adding options can also have a dramatic effect. So one great way to understand this is to analyze your marketing and sales process, or marketing funnel. Each step, or level, has a cost and a leakage rate of customers that are lost at that level. Companies need to understand the economics of each of these steps. How much does each potential customer cost to get to each level in the process? When you understand these steps well the weak spots will jump out at you to work on. Typically sales and marketing people are not analytical types and so the CEO must drive this process. If you keep identifying the weakest spot and correcting it one to three time per year your company will grow.

#2 – Be willing to spend more to get a customer – Many companies I coach and consult with are very limited in their methods of customer acquisition. Typically you should have at least three to four good solid ways to acquire customers and maybe more. This diversity in customer acquisition makes your company more stable and gives you a broader base of customers. It also gives you better information to steer your business to success due to the diversity of the customer base and feedback that will result. A common trap is to not understand each way has a real limit on volume and a very different acquisition cost too. Just because you can get a customer for $45 using direct mail does not

s has many limits, but usually one or two are more of a bottleneck on growth than the others. As each limit is taken away the level of success of the business can leapfrog. This is a great way to grow your business in steps. Often than not these limits are in the areas of sales and marketing, though certainly they can be anywhere. Minor changes in product and service positioning, or adding options can also have a dramatic effect. So one great way to understand this is to analyze your marketing and sales process, or marketing funnel. Each step, or level, has a cost and a leakage rate of customers that are lost at that level. Companies need to understand the economics of each of these steps. How much does each potential customer cost to get to each level in the process? When you understand these steps well the weak spots will jump out at you to work on. Typically sales and marketing people are not analytical types and so the CEO must drive this process. If you keep identifying the weakest spot and correcting it one to three time per year your company will grow.

#2 – Be willing to spend more to get a customer – Many companies I coach and consult with are very limited in their methods of customer acquisition. Typically you should have at least three to four good solid ways to acquire customers and maybe more. This diversity in customer acquisition makes your company more stable and gives you a broader base of customers. It also gives you better information to steer your business to success due to the diversity of the customer base and feedback that will result. A common trap is to not understand each way has a real limit on volume and a very different acquisition cost too. Just because you can get a customer for $45 using direct mail does not

customers that are lost at that level. Companies need to understand the economics of each of these steps. How much does each potential customer cost to get to each level in the process? When you understand these steps well the weak spots will jump out at you to work on. Typically sales and marketing people are not analytical types and so the CEO must drive this process. If you keep identifying the weakest spot and correcting it one to three time per year your company will grow.

#2 – Be willing to spend more to get a customer – Many companies I coach and consult with are very limited in their methods of customer acquisition. Typically you should have at least three to four good solid ways to acquire customers and maybe more. This diversity in customer acquisition makes your company more stable and gives you a broader base of customers. It also gives you better information to steer your business to success due to the diversity of the customer base and feedback that will result. A common trap is to not understand each way has a real limit on volume and a very different acquisition cost too. Just because you can get a customer for $45 using direct mail does not

ited in their methods of customer acquisition. Typically you should have at least three to four good solid ways to acquire customers and maybe more. This diversity in customer acquisition makes your company more stable and gives you a broader base of customers. It also gives you better information to steer your business to success due to the diversity of the customer base and feedback that will result. A common trap is to not understand each way has a real limit on volume and a very different acquisition cost too. Just because you can get a customer for $45 using direct mail does not mean you should limit yourself to this acquisition cost. It may still make lots of sense to spend $500 per customer if your customer lifetime value is high. So consider each customer acquisition strategy, or channel, to be completely independent. Understand that a mix of customer sources is safer and more protected from market changes and also gives you many more ways to grow.

#3 – Add channels/Niches – A great way to build a business that is more defensible against big companies is to either build a portfolio of products for the same customer base, or build a portfolio of niches in the same core competency. I define a niche as the intersection of a vertical market and a specific application of a product or service. Big companies generally cannot customize products and services for small niches well. They generally must go after large markets (horizontal or vertical plays) just to cover their overhead and get funded internally. By having a plan to develop new niches, after your first niche is stable, you can build a $100+ million company that is very stable with high barriers to entry around it in each individual niche. You have spread your bets well and hence you can also better protect your margins and customers.

#4 – Figure Out Your Sales Management Process and Never Stop Scaling Sales – More often than not when I go into a newer business that is in the low millions in revenue the founder or CEO has done some sales and/or hired a couple salespeople, but not really figured out the sales management process well yet. They have a couple sales people, who survived from the five or ten hired over the last few years - a Darwinian selection system. These couple people often carry the company, but the company does not really know yet how to hire more salespeople that will be successful without lots of trial and error. The company often does not have a real sales management process in place and needs to do this serious work to get up to 5 to 15 sales people. This is a completely different job and requires lots of work and experience in sales management, and they usually do not have an experienced sales manager on staff. Sometimes the company has been going sideways, just surviving not growing, even for many years as a result. Selling, hiring sales people, managing salespeople and planning sales strategies are all very d