Customer maximization is a growth strategy focused on deepening relationships with existing customers by understanding their needs and offering them increasing value over time through up-selling and cross-selling.
Primary Implication
The most cost-effective business sales growth method is persuading your existing customers to buy more. This strategy requires you to have product breadth to serve a more comprehensive array of needs and wants as Amazon does masterfully. It also requires you to know what your customers are buying from you and others to establish your “share of wallet” relative to what your customer currently buys and could buy from you.
If you don’t have complimentary items to what your customer has already purchased from you, this is not a viable growth strategy for your business.
Overview
The surest sales growth strategy to execute is customer maximization. Customer maximization is about helping your valued customers realize their goals and aspirations over the life of the relationship they have with you.
Sales Maximization occurs as you seek to truly understand who your customers are and what you can offer them. The efficiency of a straight-line transaction occurs when what your customer buys from you next is of greater value to them than what they have purchased from you in the past. The risk of this strategy is anytime you fail your customer; this strategy becomes unobtainable.
Customer Maximization Requires You to Up-Sell or Cross-Sell
Creating greater value that leads to customer maximization starts by identifying what additional products or services a particular customer could be buying from you that they are currently buying from someone else. The sales tactics employed here are often described as “up-selling” or “cross-selling.”
You will never maximize a customer through a one-size-fits-all approach, or by utilizing generic marketing promotions. If your growth strategy is customer maximization, deploying varying strategies highly personalized to your customers and their unique needs is much more useful.
Those successful in executing the customer maximization strategy are successful because they apply some form of the 7-P Framework to their business model. The key to their success lies in knowing what exactly their customers most value about their business. Do they value the purchase itself? Or, is it the convenience of your location or the speed with which you can fulfill their order?
Once you know the sources of value for your customers, you can create the appropriate “hooks” for your best customers and maintain your position as their supplier of choice. Your best hook lies in getting your existing customers to use a broader swath of your product portfolio. Knowing your customers inside and out is the only way to get there.
The challenge of customer maximization is ensuring that all of your customers’ purchases add an acceptable level of profitability. Too many businesses pursuing a customer maximization strategy lose sight of what it costs them to meet every customer need. Anything your business isn’t cost-effective at providing represents an item you might not want to offer because selling what you do at a loss creates profit problems.
