So much has been written about why customers should shop locally. The benefits to a community when its residents support neighborhood indies (versus shelling out for national chains or Amazon) are numerous and validated by real science.
But why then do so many local businesses fail to market persistently to their own local customers? Indeed, many indies continue to pine for those elusive “new customers,” spending their precious marketing dollars on what amounts to a shot in the dark. Perhaps they believe that local customers are already won over and that all of their potential is long-since tapped. Here’s why that assumption is usually wrong.
The legendary Pareto Principle (or 80/20 Rule) drives a fundamental, proven strategy that successful companies, large and small, have employed for generations. But most small business entrepreneurs do not come from a marketing background and may not be aware of how it works.
It’s actually quite simple:
What this means to your business is that the top 20 percent of your shoppers (your Best Repeat Customers) should represent 80% of your overall revenue. And if they don’t, you’re not marketing to them effectively.
This is important to note wherever “Shop Local” is a priority, because your neighbors make up the bulk of your Best Repeat Customers. Simple proximity makes this true for most independent shops, restaurants and service providers. Indeed, locals are your proverbial low hanging fruit. In other words, it’s easier – and less expensive – to convince a current customer to buy from you more frequently or in greater volume than it is to convince a non-customer to buy anything from you at all.
Even if new, non-local customers must remain a priority, know that they require disproportionate marketing spend. And it’s a particularly wasteful effort if you have yet to fully plumb the potential of your own local customer base.
AUTHOR’S NOTE: PoasterBoard.com is designed to weaponize Shop Local for neighborhood small business districts and their independent members. Be more than a motto with your own local PoasterBoard -and rebuild community through commerce. It’s bone simple to implement; it’s unlike anything else out there; and it’s way cheaper to use that what is out there. But most importantly, PoasterBoard.com drives Locals to Local.