To remain truly viable, however, businesses must know how to expand beyond their core customers.
This doesn't necessarily have to cost a lot of money. In fact, online video and TV ads, which tend to be expensive, are consistently reaching less than 10 per cent of viewers, according to advertising company Mirriad. There are a number of inexpensive ways to reach new customers:
1) Become a respected industry expert
This works especially well if you deal mainly with B2B sales. If you can show other businesses that you are a thought leader, someone who knows their industry inside and out and is constantly coming up with innovative ideas, you'll end up being the go-to authority. Apple is one of the most obvious examples of this - you hear the word mp3 player, and you automatically think iPods.
Although this will take time, there are many things you can do to help. Start by publishing content on LinkedIn and social media that positions you as a thought leader. This means looking at industry issues and taking innovative approaches on how to fix them. From there, you can start hosting industry events, and invite (among others) people who are engaging with your content on social media. This will help to familiarise people with your brand and increase your customer base as a result.
2) Get referrals
Conversations and recommendations account for 13 per cent of consumer sales, according to figures from the Word of Mouth Marketing Association. So getting referrals is an excellent way of winning more customers. While having a great product or service is the best way to do this, you still might need to do a little leg work. For example, try offering a discount to those who recommend the product to a friend.
3) Form partnerships
Going into partnership with another organisation, especially one that might already have a well-established customer base, is a great way to increase your brand awareness.
For example, a company that sells hiking gear could partner up with a charitable company that takes care of the environment. Those that know the charity would gain exposure to your brand, and you'd be increasing your corporate social responsibility (CSR) image as well. CSR is another great way to grow your customer base and get those all important referrals, with 80 per cent of respondents to Cone Communications saying they'd tell friends and family about a company's CSR efforts.
Paid advertising is becoming less and less effective, and this presents both an opportunity and a difficulty for businesses. While you can win over consumers in a more cost-effective way, it does mean you have to be a bit more creative in how you do it.