True, going after new customers is an exciting part of being in business. There’s the motivation of identifying a new target, the thrill of the chase, and the satisfaction of the close.

But the reality is that your startup business likely will get more mileage out of optimizing your relationships with existing customers – even if there are just a few of them – than from using those same resources of time and money looking for potential new customers.

“The conventional wisdom says that it costs six times more for a business to acquire a new customer than it does to sell something else to an existing customer,” says Chet Holmes, a California-based sales consultant. “I’d say it might even cost more than that.”

The first step in turning existing customers into more revenue and higher profit-generators is getting to know them better. In the first part of a two-part article, we provide advice for expanding your understanding of the customers you thought you already knew.

Really get to know your customers

The way to most effectively cross-sell and up-sell existing customers is to convince them that you can improve their results because you know them intimately. This means you have to get to know your customers as well as you know your own company.

“Listen to what they say and don’t say,” says Erika Oliver, a business trainer and author in Kalamazoo, Mich. “Become well versed in the challenges and opportunities in their business. Interact with them in their space, such as at their company and at community events where they’re involved.”

Lower-level people in a business can be invaluable sources of information about influencing purchases and other decisions made at higher levels. And the amount of information online, especially about large corporations, is mind-boggling.

Use your knowledge to set the hook

Revisit all the data you have about your existing customers so you can figure out how to more closely cater to their needs; if you haven’t been collecting information on them in every way possible, start now. That allows you to hone your sales efforts in a way that’s custom-designed for them.

“Spend time thinking about how your offerings can be leveraged to drive their results, revenue, more efficient processes, and to attract and retain talent,” says Karla Robertson, a business coach and consultant based in Howell, N.J. “Ask others about how they see your company so you don’t get into a rut.”

By knowing both your business and your existing customers better, you’ll be able to accurately aim business-extending offers to them through e-mail and snail mail. You’ll know whom to see and where to go within their organization for useful influence and without stepping on toes.

This way, you won’t have to throw a lot of guesswork or advertising dollars into unfocused stabs at pleasing your customers. You’ll already know how to please them!

Distinguish among your customers

Not every existing customer is a good customer. It’s important for you to be able to tell the difference so you can really focus on the best ones.

Core customers typically comprise 20 percent of a company’s base but provide 80 percent of profits, says Robert Gordman, a management consultant and author of The Must-Have Customer: 7 Steps to Winning the Customer You Haven’t Got.

“It’s important to know who your profitable customers are,” he says. “Once you know who’s profitable, you can find out why they’re doing business with you. Then you can start extending the relationship with them based on why you’re currently successful with them.”

Our Bottom Line

If you’ve already satisfied a customer once, the likelihood is that you’ll be able to satisfy them again. And by focusing on understanding existing customers so you can serve them better, you’ll be building your startup business in the most cost-effective way possible.