Iliyana's Blog

The Hard Truth About Customers (And Any Individual Really)

[fa icon="calendar"] 15-May-2018 09:00:00 / by Iliyana Stareva

customers today trust their friends and families above all else

We do a lot of research at HubSpot. 

It's how we remain able to deeply understand human behaviour and so manage to innovate by developing new software that people actually want to and need to use. 

We invented inbound marketing which helped thousands of companies out there drive good-fit leads through their own website and content, and then pass them onto the sales department that though an inbound sales philosophy became able to close these leads into actual customers and so grow the company's revenue. 

We preach what we teach and this whole methodology served us well for a long time. But by deeply knowing our own customers we're starting to see a shift where customer acquisition through the described approach above is not only becoming more expensive but it's also not as effective as it used to be

People now trust other people - they trust their friends and families and they ask them for recommendations. This means that now more than ever you need to leverage your happy customers because they will naturally bring you other customers. 

Customer acquisition through happy customers is your biggest opportunity for business growth. 

For many organisations this shift will be a shock. It'll take them a long time to adapt but there's no better time than now to get started. 

As I said earlier, we do a lot of research at HubSpot so today I want to show you some facts about how consumer behaviour and interaction with companies has changed from two studies we've done - one on customer acquisition and another on customer success. This data fully supports the points I made earlier and I hope it'll get you thinking too. 

#1 Consumers don't trust businesses anymore

1-trust-in-business

#2 Word of mouth is the most important source of information when making a purchase decision

9-sources-of-information

#3 People don't trust Marketing and Sales

10-marketing-sales-trust

#4 Your traditional acquisition through Sales won't work in the long run

13-acquisition-math-broken

#5 People really do talk about businesses they've had a positive experience with

Customer-Service-report2#6 Businesses that care about customer experience are set to grow

Customer-Service-report-1

As we conclude in one of those research studies, 

The hard truth is that your customers need you a lot less than they used to. They learn from friends, not salespeople. They trust other customers, not marketers. They’d rather help themselves than call you.

Taking another point directly from the customer acquisition study, I want to leave you off with the following to make you do the math and think about the future of your business:

When you’re growing a business, two numbers matter more than anything else:

  1. How much it costs to acquire a new customer (or “CAC”)
  2. That customer’s lifetime value -- how much they’ll spend with you over their lifetime (or “LTV”)

For many years, most businesses (HubSpot included) focused on lowering CAC. Inbound marketing made this relatively easy, but the new rules of the internet mean this is getting harder. As Facebook, Amazon, and Google tighten their grips on content, the big opportunity for today’s companies is raising LTV.

If your customers are unhappy, you might be in trouble. But if you’ve invested in their experience, you’re well-poised to grow from their success.

When you have a base of successful customers who are willing and able to spread the good word about your business, you create a virtuous cycle.

 

How will you grow your business in the coming years through your existing customers? 

 

Topics: Brands and Business

Iliyana Stareva

Written by Iliyana Stareva

Iliyana Stareva is the author of Inbound PR - the book that is transforming the PR industry. She's also a keynote speaker and a consultant in inbound and digital for fast-growing companies and agencies. Currently, Iliyana is Program Manager in the Chief of Staff office for CX EMEAR at Cisco where she is the operational leader for all things Customer Success. In her previous roles at HubSpot, she led major cross-functional change for the global Partner Program with her detail-oriented approach to project management and advised hundreds of agencies on how to transform their businesses with inbound and digital. During that time, she earned the globally recognised Project Management Professional (PMP)® certification by the PMI. In her free time, you can find Iliyana writing for her blog, dancing salsa or travelling the world.

Subscribe here!

New call-to-action

Get Social

inbound-pr-winner-new-pr-books
V By Very Blog Awards 2017-Silver.jpg

Popular Posts

Public Relations Today

Want to talk?

Iliyana_stareva

I'm always happy to chat about how we can work together. Get in touch with me and start the conversation. I'd love to hear from you.

Contact Me