Starting a business is hard; keeping it going is harder
There is a Chinese saying that starting a business is hard and keeping it going is harder. These days starting one may not be so hard, because internet communications have made it something close to a habit. Walk into a mainland bookshop and you see young people standing among the shelves on “starting a business” and “opening an online store”, because people would rather not work for someone else and mostly want to be the boss — or simply because online shopping demand is so large that an online store of one’s own looks like a way to earn extra.
Running an online business is now the norm. You do not need your own product; acting as an agent is enough. You do not need to mobilise capital and build a factory, which costs far too much for a young person to carry. So today there is no shortage of product and no shortage of channel — which means the effort has to go into the customer.
A founder has to answer three questions:
- How do I find customers, and where do they come from?
- How do I keep them — turn them into loyal customers who buy repeatedly?
- How do I get customers to refer new business?
The activity that revolves around customers is what business management calls customer relationship management, or CRM. While a founder is searching for a product and a platform to make money on, they should also be building a CRM approach that coordinates finding customers, contacting them, understanding them, and exchanging feedback.
The premise of CRM is not that you need a system, because the core of CRM is this: customers need to be paid attention to. That is simply human. Everyone in society should be paid attention to — that is how relationships between people advance and grow solid.
And the most fundamental method of paying attention, and receiving it, is communication. So a founder has to ask: are we providing a channel to communicate with customers? One that carries a message, gets customers to accept our product and service, and to accept the direction and mission we are running the business on? And do customers have a channel to respond to us and share what they think?
Today we all use social media heavily for CRM, because it spreads fastest and widest — but it lacks depth. Social media has been generalised, and customers read it as just another piece of promotion. There is an international chamber of commerce that, for every large event it runs, sends a letter — and writes the recipient’s name and address on the envelope by hand. Years of evidence show those hand-addressed envelopes get opened, because beyond being different and thoughtful, they show the sender regards the recipient as a friend worth the effort.
Methods we assume are old and finished can carry a great deal of human warmth, and customers feel the attention. So perhaps, while calculating costs, a founder should adopt the CRM approach with the highest return: email marketing remains the obvious choice, because its return is 1:40. If you are willing to build a long and close relationship with customers and let them become a source of business, email is the best communication channel to choose.