Selling to Both Businesses and Consumers
Be careful when reviewing the business customers already in the database. Many marketers assume that bigger is better. They assume that if they target larger companies, each sale will be larger. However, it is not uncommon to find 70 percent to 80 percent of a company's business client revenue coming from companies with 15 or fewer employees. Small business can be the best customers, are often much easier to deal with, and often allow higher profit margins. Don't be surprised if small businesses are your best customers.
How Many Business Customers Are There?
If businesses have been treated like consumers, it may be difficult to tell if a customer is a business or a consumer. This is especially true when there is no specific place to store a company name in the database, or notes about a customer are occasionally put where a company name should be.
To get an idea of how many customers are businesses, start by having a database specialist look through the name and address fields for words like Inc., LLC, The, Suite and Corp. A next step is to overlay the data with business demographics. Those that match are businesses. A little more work should make the distinction between consumer and business addresses fairly accurate.
Making Use of the Knowledge
Once you establish how much sales come from businesses versus how from consumers, you can determine how profitable different customer types are.
If this type of analysis has not been done recently, it will likely result in a major shift in both prospecting and repeat-customer marketing. In most situations, business are targeted more as prospects, and reached differently as customers. How this is accomplished varies greatly from company to company.
Look into your database, and see if you can tell how profitability of consumers and businesses compares. You may be surprised.