The NUMBER ONE growth hack used by every successful business

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What's the number one growth hack used by every successful business? Believe me, it's not what you think. Now, I'm Paul. If you haven't met me before I’m a CFO, I'm an accountant. I'm an entrepreneur. And I've got over 25 years of experience in helping businesses to grow profitably. Now, if that sounds interesting, do me a favor and click the subscribe button below.

We'll be posting content every single week with lots of great tips and tricks to help you improve your business. Okay, so let's get to the subject in hand. What is the number one great hack? Well, it's all about really knowing your customer. And before you roll your eyes and think, Oh, how many times have I heard this? It's not what you think.

We need to go so much deeper than that, because absolutely everything in your business depends on knowing your customer properly. Why is that? Because if you really know your customer, you can make them happy. And if you can make your customers happy, then you can generate more sales, more profit, more repeat business, and ultimately more long term business success.

Okay. Well, let's dive into some examples of how you might do this. So let's look at things from a products perspective or a service perspective. The more you know your customer and the better you know them, the more you can design products and services which meet their needs -  the more you can give them what they want, the happier they'll be and the more likely they are to buy from you.

Take, for example, Apple. one of the most successful businesses in the world. They are a success largely because their products are 100% aligned with the needs of their customers. They know their customers inside out and they know what they want and they develop products that meet those needs. Notice I’m saying needs, not wants. I think if you asked any of us whether we would want an iPod 15 years ago, we wouldn't have known what an iPod was. But they understood that people wanted to carry music with them in their pocket in a way that was easy to access, that was fun and yet trendy. And that's really what I mean by thinking about what your customers really need and making sure that whatever you are selling, whether it's products or services, that they completely align with that.

Secondly, let’s think about knowing your customer from a marketing perspective. And actually, when I talk about this with customers, with clients, they normally go down the marketing angle thinking I need to know my customers so I can design an effective marketing campaign. And that's, of course, true. But actually, the better, you know, your customers, deep down, the more you can not just design a better campaign, but actually design marketing materials which actually resonate with them, actually makes people think “Yes, that's exactly what I want”. And actually, that's not always as simple as just knowing how to sell them a product. Normally the starting point is actually thinking “What am I really selling? What are people really buying from me?” 

 And so take, for example, Nike, now one of my favorite sportswear brands now. Yes. They sell sportswear, mostly shoes. But actually, if you look at their most recent marketing campaigns, they don't focus on the products at all. What they're actually selling is a lifestyle. They've got lots of very aspirational adverts with lots of athletes, very successful sporting people, and that's really making them very aspirational. For those of us who want to be fit and do exercise, but perhaps feel that it's difficult and hard, the more we see really successful people wearing their clothes, the more we think I want a little piece of that. And so that's why we go out and buy their sneakers. So that's really what I mean about marketing and designing effective campaigns. Think about not just the product, but really what are they buying from you and why? And if you understand the ‘why’, then you can design much more effective marketing campaigns. 

Let’s think for a minute about another area, a really important area: customer service. Now, this comes down to, yes, sending people what they want, but actually making people feel important and valued and special. The more you can give people what they want and give them a pleasurable purchasing experience, the more likely they are to come back and buy from you again and again. And I'm going to pick another example here. Let's go for Amazon. Now, if you think of Amazon, I mean, obviously they're huge, but a big part of their success is because they really know us as customers. Now, you might say in a way it's a little bit sneaky how much they know about it from a data perspective. But what they're very good at on their site, which literally sells millions of products, is they're very good at knowing me as an individual, knowing my browsing my buying patterns and showing me what I want as quickly and as easily as possible. So putting the right thing in front of the customer at the right time as quickly as possible means that I'm much more likely to buy from them. And also that makes everything easy. The purchasing process is easy because I can click out without anything, any, any card details.

I know that I can return things very, very easily. So I don’t have to worry about whether it's right or wrong. And the whole experience, the shipping, everything comes to me really, really quickly. Now, I pay a price for that,of course I do, with Prime and such like. But actually they're giving customers what they want and that's largely why they're so successful. And in fact, many people, me aside, will quite often buy things from a smaller business, but via the Amazon platform, even though I know Amazon is taking their cut because I have the confidence, if something's not right with it, that I can return it to Amazon and they’ll look after me. And so from a customer service point of view, really knowing what's important to your customers means that you can make that whole experience much more valuable to them, which makes them much more likely to buy and come back.

So I guess that's some reasons why we need to focus on it. Perhaps a quick question. How well do you know your customers? Have you ever looked at them taking a step back? Do you know them as well as perhaps a good friend? Because I'm suggesting that's probably as well as you do need to know them. If you do put some comments below, I'd like to know your thoughts.

Okay. So we've kind of looked at why it's important to really know your customer and to get under their skin and know them on a much deeper level than just the superficial level. But the next question which follows is if I need to know a customer in that amount of detail, how on earth am I going to do it? Well, the good news is there's quite a few different ways and you don't have to spend hours and hours and hours on this. This is something that you should be kind of doing as a perhaps a one off exercise at the start if you haven't done it before. But then as you go, you want to be collecting data and feedback on your customers on an ongoing basis, putting in place the right kind of processes to gather that feedback so that you can make sure that what you're doing on an ongoing basis is giving customers what they need.

Okay. So let's look at the ways in which you might be able to know your customers better. Well, the first one is feedback. I mean, it all comes down to asking customers. Look at the people who are buying from you and send them a survey or pick up the phone and give them a call. Find out what they bought from you, why they bought from you, how was the purchasing experience. If you do a few of those calls and perhaps contact a handful of customers on an ongoing basis, you'll get some really valuable feedback. So a regular feedback loop is really, really important to not only knowing your customer upfront, but also continuing to build a relationship with them. 

The other way, which perhaps you might want to look at your customers, which perhaps is the easiest, is to go to social media. Now we might think of social media as a fun thing that we do for leisure, or perhaps a way that we can market to customers. But actually, if you spend some time online looking at the kinds of people who are buying from you, you can learn an awful lot from social media because people are very open these days about their lives. Now, I'm not talking about creepy snooping - I'm talking about trying to understand what are the commonalities between them.

The trends can you learn about your customers? Are your customers aspirational? Do they go on holiday a lot? What kind of other interests do they have? What other things are important to them? And these are all things which should help you understand why they might buy from you and will help you perhaps tailor your product offering to really give them what they want.

The other way that you can think about really knowing your customer, which is one of my favorites (because obviously I'm an accountant and I'm into numbers), is to look at the data. So, what do I mean by that? That's a scary word for a lot of people, particularly if numbers aren't your strong point. But what I mean by that is have a look at the customers you have and look at their purchasing behavior; what kinds of customers are buying from you, what products of yours are they buying, and how much do they spend when they come to you?

Do they come back and how often do they come back? How often do they reach out to customer service? What kind of feedback scores are they giving you? All of these data points are something that you can use to really understand which customers are buying your products. 

The reason I like this kind of analysis is that the other ways we’ve discussed are perhaps a little bit more subjective. And there's a real value in that. But there's also something very comforting about looking at the data and being grounded in the data because this data is based on people who are actually buying your stuff. So these people like your products and it's really those people you need to understand because in an ideal world, if those customers are buying your product, you want to get more like them.

The final way, perhaps you might think about finding out a bit more about your customers is to look at the trends. What's going on in the marketplace? For example, at the moment we want to be working more from home. Is that applicable to your customers? What other things are happening? Are people spending more on certain kinds of things or less on other kinds of things?Knowing these global high level trends will kind of help you understand what your customers might be thinking. And then it makes it easy for you to tailor your product offerings to meet those needs. 

So I guess we've looked at why you need to do this and we've looked at a few ways that you might do this, but I'm ending with one big caveat, and that is you have to really think about who are you going to focus on? You can't sell to everybody and in fact, you shouldn't sell to everybody because like everything in life, if you try and please everybody kind of end up pleasing nobody and you run yourself ragged and chasing your tail.

So what you need to do is, now you've done the work on who your customers are at the moment, who's buying from you and what they're buying and how often, you need to build a profile of the ideal customer that you want to focus on in detail. And then everything you do should be focused on that one persona (or possibly two or three, but certainly not everybody). And that way, as we all know, less is more. The more you can focus in your business on the right drivers of growth and focusing on the right customer for you, that's really the starting point. So this is where you might have to be a little bit ruthless because, as I say, you can't sell to everybody and you've only got so much time and energy and resources. 

And everything you do should be largely geared to those people. That's not to say that you don't sell to the others, but that's to say they really need to be the heart of your business focus. 

Does that make sense? As I said at the start, yes, you might think you've heard this before and of course you have. But it's really, really important because it really does impact every aspect of your business and the successful businesses. Nike, Amazon, all of those successful businesses really know their customers well, and that's not in no small part the key driver of their success. 

Well, how do you find that interesting? And if you did, I know there's a fair bit of information that I hope you weren't worrying about scribbling anything down. I do have a fact sheet which you can download below which basically just summarizes the key points from this podcast. And if that's interesting, I also have another free guide which has proved really, really popular and it's all about cash flow and turbocharging the cash flow in your business and doing so without selling a penny more. And if you haven't done it yet, please do subscribe to my channel. I'd love to be able to send you updates on our new videos I’m posting and do drop me some comments. I'd love to know your thoughts. 

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