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Blog Bling
Oct
15
Small Business Customers Are Worth 20 Times More
October 15, 2005 | Anita Campbell
The sheer numbers of the small business market – 25 million strong in the United States alone – are too alluring to resist.
Yet, sales individually to each small business customer can be relatively small. A few thousand dollars in a year’s time, perhaps much less, may be the typical sales volume to a small business customer.
That makes it a difficult sale for many vendors. Vendors fail to see how they can make a profit selling to small businesses if one-on-one selling is attempted. It’s no wonder that so many end up selling through channel partners or over the Internet.
But an article I ran across recently puts a sale in a different light.
Jeffrey Gitomer, author of Customer Satisfaction is Worthless, Customer Loyalty is Priceless, says in a Biz Journal article that “the value of a customer is 20 times his annual sales volume. A $10,000-a-year customer has a value of $200,000. That’s what you earn if you keep him, that’s what to fail to earn if you lose him.” (Read a summary of his book here, also covering the customer loyalty issue).
Viewed in this light, those small business customers may be worth a more direct and personal approach.
