One of the most common laments of the small business owner is that marketing and advertising is a necessary evil which costs more than they can afford.

Many companies, though, are ignoring the most valuable resource they have available – their past or present customers. Consider the fact that it can cost as much as five times more to reach prospective customers than to contact existing ones. Clearly it makes sense to do some creative thinking about making the most of your existing contacts.

Ask yourself whether your customers might be persuaded to do any of the following:

• Buy more of your product or service, or buy it more often;
• Buy accessories or add-on products;
• Purchase follow-up services or products;
• Up-grade;
• Buy different products or services;
• Recommend your company to someone else?

Or, on the other side of the coin:

• Transfer their business to one of your competitors?

If the answer to any of these questions is yes (or even possibly) then you should be engaging in a campaign of regular communications in which you educate your customers, keep your company name in their minds, and motivate them towards your desired course of action.

This on-going campaign of communication is the cornerstone of direct marketing, whereby you are personally contacting highly targeted prospects (in this case, your existing or past customers, or even enquirers) rather than pepper-spraying a message to a mass audience in the hope that some may be potential customers.

It is also a concept that works for almost every type of business from the smallest home-based company, to the major big box stores. Think how much money Sears spends mailing catalogues to previous purchasers. They know that, having purchased once, these are the most cost-effective prospects to contact for future purchase. On the opposite end of the scale, the cost, to a small business, of sending a mailing to 100, or even 1,000 past customers is very small, and the benefits in terms of your return on investment can be huge.

You should be constantly thinking of reasons to contact your customers. Advance notice of sales, special offers, staff changes or new products can all be woven into an interesting story and combined with incentives for purchase.

Remember, something as simple as ideas for new ways to use your product, or a holiday greeting, will entrench your company name in the minds of valuable prospects.

Relationships will be one of the most important aspects of your business operations. Make sure you make the most of them.