Why SMB businesses are failing to grow

Winter is here to stay - SVB closure and the long winter economy

As if things weren’t bad enough for the startup scene over the last few years, the recent announcement of Silicon Valley Bank’s closure, hints that we should be expecting an even longer winter economy.

We can expect even more layoffs, store closures and further inflation, which will very quickly shift the script from ‘business growth’ to ‘business survival’ in the coming years.

And the unfortunate truth is that among those that fail to survive, small and medium sized businesses will most likely be the first to go.

So what now? Where do SMBs run to?

Channel Talk might be able to shed some light.

What businesses are missing - breaking down the Pareto principle

One thing that we’ve observed among the numerous startups and ecommerce brands that we work with, is that the companies that survive and even grow during these ups and downs in the economy, are companies that have a strong foundation built around the Pareto principle.

The Pareto principle in business suggests that 20% of your input accounts for 80% of outcome.

If some of you are familiar with the Pareto principle, you’re probably nodding your heads thinking, “yeah, yeah my business is pretty much the same.”

But is it?

The Pareto principle in e-commerce and online business implies that 20% of your top customers are responsible for 80% of your overall revenue.

But it doesn’t apply to every case.

To clarify, the principle is implying that 20% of customers have the potential to bring in 80% of the revenue for a business, but the reality is that most companies are sitting between 40-60% and they’re oblivious to this fact.

You’re spending money on paid ads to acquire new customers, yet there’s still so much revenue you could be claiming from your VIPs and regulars.

Not to mention paid ads aren’t working the way they used to anymore.

So what am I missing? - Understanding your customer base

The basis of the problem comes from companies not understanding their customer base.

Most businesses have a list of customers that buy from them, but have no way of identifying who they are or segmenting them into new vs returning VIP customers.

Most of these companies end up spending hundreds or thousands of dollars implementing SaaS tools of all kinds, hiring specialists and consultants, or drain marketing budgets in an attempt to improve company growth, which in fact hurts their cause.

There’s a strategy that’s simple and easy to follow, that’ll help you withstand the influence of an ever-changing economy.

It’s building up the number of regular customers you have for your brand.

Customers that turn to your brand regardless of how the economy is, trusting that you have what they’re looking for and trusting the quality of service they’ll receive along with their purchases.

You can do this by recognizing key customers, and having quality conversations — more commonly referred to as customer relationship management or CRM.

That sounds great, but does it work? - Demystifying the effects of quality customer service

Many people still doubt the effects that customer experience has on business revenue.

From a social standpoint, customer service has always lingered near the bottom of business priority lists, and the image of customer service reps being the emotional sandbag of disgruntled customers is heavily embedded into our minds through modern media and culture.

But what many businesses forget is that customer service is the front line, and the face of their company.

The impressions they make on customers can change how they perceive the brands they choose to buy from.

Good quality customer experience can turn a customer into an ambassador for a business, attracting others to come and purchase from them — in some cases, in a cult-like fashion.

Nike or Apple are perfect examples of the effects of obtaining and retaining a strong following of regular customers. Both brands could completely stop any attempt to attract new buyers, and they’d stay afloat for years, solely through referrals from their existing customers alone.

Where do I go from here? - Revamp your customer experience

Take a hard look at your current customer base and ask yourself — how many of these customers can I say are true regulars of my store?

Once you have that number, look at how much revenue they account for compared to the total revenue that your store makes.

If they account for less than 80% of your total revenue:

Calculate how far off you are from 80%. Then calculate what the number should be if they were actually producing 80% of the total revenue.

That’s the potential additional earnings you could be making by improving customer experience and the quality of service for these regular customers.

Recognize who they are and greet them by name, reach out and communicate with them, ask them for feedback on your service or product so you know where to improve.

If they account for 80% or more of total revenue:

Great! You’re on the right track.

Now it’s a matter extending the time they stay loyal to your brand.

In order to do this, you need to understand the relationship you have with your key customers. Do you know some of them personally? Do they return to your store regardless of advertising? Do they reach out to you to ask questions and request help?

By increasing the quality of the communication you have with them, you can extend the life time value of these regular customers and ensure that your business will continue to perform regardless of market trends or economic uncertainty.

How can Channel Talk help? - Why it’s the perfect time to adopt us

With everything that’s going on in the world — inflation, rising costs and a declining economy —it’s natural to see companies scrambling to find greater value for every dollar they spend.

Take a look at how much money you have and how much you’re spending on your business. Is it sustainable? Is it scalable?

Channel Talk offers a free plan, and paid plans where the pricing scales when you scale. We designed the pricing this way to give small and medium-sized businesses a chance to pay us when they grow. We believe that your success will become our success.

There are very few customer support software on the market that offer an unlimited live chat, team chat, and operators on a single platform, not to mention, include a CRM database that’s customizable to every industry.

Also including chatbots and inbound marketing features, the entire platform was built to help small and medium size businesses have a fighting chance in the competitive landscape of online commerce.

Most importantly, it’s designed specifically to help businesses connect with visitors to the site, offer the best in customer experience and convert them into regular customers, that’ll return to your store specifically for the quality of service and the personalized experience.

If you want more bang-for-your-buck when it comes to customer experience, you won’t find it anywhere else.

Why should I trust Channel Talk? - Taking the first step

All companies start from somewhere.

And it’s natural for people to feel wary about a platform they’re seeing for the first time. But you can rest assured on the quality of our product.

Also, we don’t just preach about creating regulars for your business, we practice it every day.

Channel Talk is new to North America, but the service has been around for more than 7 years in Korea and Japan — countries that set the bar for quality customer service — as a leading customer experience software.

We maintain 98% retention rate with over 120,000 brands trusting us with their customers. And the number of fans we have continues to increase each day.

The platform has been tried and tested across many industries, and Channel Talk as a company, has helped many startup businesses find their product market fit, and grow into leaders in their respective markets.

We’re confident that if Channel Talk can stand up to the standards for Korea and Japan, it can work anywhere.

Imagine the difference that customers will feel when they receive this type of customer service.

The experience will be unforgettable.