Finding new customers
Explore ways to expand your customer base when selling person-to-person or business-to-business. For other ways to find new customers, consider marketing activities.
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Investing time to find new customers
There are many ways you can improve your process to find new customers.
While you're investing the time in finding new customers, make sure you continue to provide high-quality service to your existing customers. Satisfied existing customers who bring repeat business and referrals are very valuable.
Funnelling contacts to customers
The 'sales funnel' is a model for transitioning people from being contacts to being customers.
Contacts > Leads > Prospects > Customers (sales).
At each step, the number of people decreases. For example, many of your contacts can become leads, but only some of your leads become prospects, and only some of your prospects become customers.
Ways to identify contacts
There are many ways to identify contacts:
Tips for networking events
Look for opportunities to participate in business events, industry and government forums, trade shows and stakeholder roundtables.
Consider these tips to improve your approach to networking, which can help convert leads into prospects and customers.
- Take at least 10 of your own business cards with you.
- Be proactive and confident in your approach. Move around the room and introduce yourself to people you don't know.
- Shake hands, exchange business cards and share your 30-second 'elevator pitch' with them:
- who you are
- what business you represent
- what your business does
- your business's point of difference
- what outcomes you hope to get out of attending the event.
- Listen carefully to the people you are talking to and think about how their business might benefit from your product or service.
- Never depend on someone contacting you. After the event, dedicate time to follow up with the people you met. Let them know it was nice to meet them, and open an offer or opportunity as a call-to-action. Consider sending your company profile, capability statement or marketing flyer.
Converting contacts to leads
Once you have met and engaged with a new contact, work out whether they need your products and services. Create an 'ideal lead profile' to help you establish which contacts you should focus on to convert to leads.
Based on your market research, your ideal lead profile will define characteristics such as:
- geographic traits—where the people or businesses likely to buy from you are located
- demographics—the age, gender, income, occupation type, education level, cultural background, and household type (e.g. single, married, families) of people likely to buy from you
- psychographics—social factors such as lifestyle, interests and activities, opinions, self-image and social group memberships.
Include your ideal lead profile in your marketing plan.
Make an ongoing effort to forge relationships with customers who match your ideal lead profile—this will help convert these leads to prospects.
Converting leads to prospects
Prospects are leads who show interest or potential to buy your products or services.
You have identified your prospects once you have found leads who have:
- a need for your product or service
- the ability to make a decision to buy
- the ability to pay.
This process is called qualifying your leads. Once you've qualified your leads, you may find you have several prospects. Decide where to prioritise your efforts by assessing both the value of the sale and its probability of closing.
Developing a prospecting plan
A prospecting plan help you make the most of opportunities to turn leads into prospects. This plan outlines useful information to send to your leads through media such as phone calls, emails, e-newsletters, your website and social media, presentations, marketing and signage.
You can also use your prospecting plan to ensure your information stays relevant, professional and informative—offering useful industry news, trends and business tips.
Use your prospecting plan to help your sales forecasting by calculating and defining:
- how many genuine prospects are likely from your leads
- how many new customer accounts you can realistically open
- what average sales volume you can expect from new accounts
- how to follow up potential customers regularly without losing impact.
Be selective about how often you make contact and what type of contact your make. Potential customers may reject businesses after receiving inappropriate, repeated or annoying advertising material.
Make offers with meaning
Tailor your offerings or incentives specifically to the needs of each lead.
Researching customers will provide you with a thorough understanding of what your existing customers need. Being able to quickly identify the needs of your leads will help you make offers.
Becoming a customer-focused business will provide you with steps to segment, target and position your offers by dividing a big group (the broad market) into smaller groups called segments.
These processes can be time consuming, but balance them against the value you achieve from customer loyalty and purchases.
You may find that a lead you identified as a prospect some time ago, is simply not ready or not interested in buying your product. It is a good practice to do a 'clean' of your prospects, removing or archiving those who have been inactive.
Listen and investigate
Observe your lead closely and ask questions that will give you the information about their needs. It may also be practical to make polite enquiries to work out your lead's capacity to buy.
Read more about improving your sales skills to help you negotiate successfully and convert your leads to prospects.
Plan your approach
Before reaching out, define your purpose for making contact.
For example, your objectives may be to:
- build rapport
- find out more specific information about your lead's needs and wants
- build further awareness of your business's products and services
- offer information about pricing and sales promotions
- obtain feedback from your lead.
Organising information about contacts, leads, prospects and customers
Keeping accurate records can help you quickly identify and meet the needs of your customers.
Depending on the size and nature of your business, your customer records may be kept in:
- a spreadsheet
- a database
- customer relationship management (CRM) software
- sales automation software—usually for larger business with complex customer profiling.
Your system can help you to identify strategies for achieving sales by looking at key customer information.
A CRM usually includes a prospecting component to help you manage this information.
Your system should store or reference correspondence with each contact, lead and prospect, including:
- the date and time of contact
- the responsible salesperson
- how the contact was made (e.g. via the website, phone, email)
- the content of written correspondence, or a summary if it was a verbal interaction
- the results of the contact.
You can use this information to schedule future contacts and help you target your follow-ups to secure sales.
Using customer information
Laws protect the privacy of your customers and the information you collect, store and use.
Find out more about collecting, storing and using customer information.
Making the most of your information
Well-maintained records allow you to generate information that will help you make sales.
For example, with well-maintained data you could generate a list of leads and prospects who:
- have not been contacted recently
- have a need for a specific type of product or service
- live in a certain area
- prefer to be contacted via email
- are of a specific demographic (e.g. income level)
- have received information about an upcoming sales promotion.
In the lead-up to quiet periods, you could contact prospects to promote products and services, encouraging purchase during the quiet period.
With accurate data, you can predict future behaviour of your prospects and assess the effectiveness of past promotions and campaigns.
Your records also allow you to classify people as leads or prospects, assign priority rankings to prospects and leads, and avoid sending repeat information and correspondence to your prospects.
Choosing a database
If your business doesn't require sophisticated software, you can manage contact, lead, prospect and customer information using spreadsheets.
As your needs grow, you may find that purpose-built software will be more efficient and valuable.
To buy or license software to organise your prospect information, consider:
- office or business software packages that include databases
- online CRMs or sales automation services
- software that allows you or a database designer to build and customise a database for your business.
- Learn more about ways to advertise your business.
- Find out about using different sales channels.
- Read about preparing a business quote.
- Last reviewed: 16 Nov 2022
- Last updated: 16 Nov 2022