Ok. I’ll admit this is a counter-intuitive question, but let me expand.
Now that your potential customers can evaluate, compare and review your offers easily over the Internet, (and, especially easy using social media like forums) you probably find more and more of your new customers are price sensitive.
Fine. Who cares? They’re putting money in the till, yes?
Well actually, you should care.
By attracting more and more of these ‘serial switchers/rate tart’ customers, you could be replacing loyal, quality-sensitive customers with those who are likely to move to one of your competitors because they offer a better price promotion in one given week.
Not only have you then sacrificed margin to get these customers, but now you have lost all the future value of these customers.
However, don’t despair that you are losing customers. The fact that your price sensitive customers are leaving you will probably work in your favour.
The real key to building long term profitable customer database is profiling.
By profiling your most loyal, and, more importantly, your most profitable customers, you can define a blueprint of the type of customer you want more of.
And the good news is, these type of customers are not usually very price sensitive.
Following this expansion strategy will ensure you continue to attract more of your ideal customers, and will also set a precedent for new customers (that you do not discount).
The downside?
It’s not as easy as running a 25% off promotion. You can’t be lazy. You need to carefully research your existing customer and painstakingly duplicate them.
The upside?
Using CRM methods you’ll retain margin, retain profits and actually save massive amounts of time by not constantly holding expensive ‘dinner parties’ for potential customers you neither like nor respect.