Acquiring new customers is the lifeblood of any publishing company. Take a look at your current marketing plan and see whether this is one of your primary objectives for the year. It should be. As an experienced marketer, you should know the answers to these questions off the top of your head:

Don't know the answers? Now would be a good time to start analyzing this information from your marketing database.

B2B marketing is always a challenge. Do you count the institution as a customer or a person within an institution as a customer? I recommend you count both. Because of the complex buying processes within libraries and schools, identifying the specific person who was responsible for the purchase is sometimes difficult, if not impossible. But it's fairly easy to look at the institution itself and identify whether or not a purchase was made in a prior year. But, great marketing efforts are created to appeal to a person –- not a building –- so digging deeper into the customers you have attracted within a building is essential.

Dig Out the Facts

Lets say that you analyze your customer file and find out that in 1997, you attracted 1,000 new institutional customers, in 1998 1,200 more were added and in 1999, your new customer acquisition fell to only 800.

What Does This Tell You?

Obviously, something changed. Perhaps you cut your marketing budget in 1999. Perhaps your new products were published late. Or were uninteresting to the market. Perhaps you had a large turnover in your sales team. Or a new competitor arrived on the scene. There could be numerous reasons but if you are to reverse this trend, having the facts makes it easier to identify the problem and make a correction.

What Else Do You Need To Know?

The other essential element is the "lifetime value" of these new customers. Let's say you found out the following: In 1997, the annual expenditure of an average new customer was $250.00. That same average customer spent $500 in 1998 and $1,000 in 1999. Therefore, the "lifetime value" (assuming a 3 year retention rate) would have been $1,750. Using our example of acquiring 1,000 new customers in 1997, and a "lifetime value" of $1,750 per customer, this translates into $1,750,000 in sales over the three years.

Now, in 1999, new customer acquisition fell to 800. This means that from 1999 through 2,001, revenues from these customers would only total $1,400,000. A drop of $350,000 in total revenue. This is a lot to make up in future years especially when sales revenues need to grow –- not decline – every year.

Conclusion

Keeping your eye on new customer acquisition trends is essential for keeping your fingers on the pulse of your business. It's the most expensive part of your marketing investment and companies that can creatively reduce the cost to acquire new customers while generating increasingly more new customers will be the winners.

ABOUT THE AUTHOR
This article was written by Carol Ann Waugh, President of Xcellent Marketing, a marketing and new business development firm specializing in the educational and library market. Xcellent Marketing offers a variety of marketing services to help publishers increase their revenues and profits from identifying new markets, providing critiques of web sites and marketing communications such as direct mail, catalogs, advertisements, etc. as well as developing effective traditional as well as Internet-based marketing plans. Carol can be reached at (303) 388-5215 or at cwaugh@xcellentmarketing.com.