I remember when I got my first pair of Chuck Taylors at 7 years old. I had just seen The Sandlot, and was psyched out of my mind when I saw them for sale in my small town’s local shoe store. Proud as a peacock in my new shoes, I went to the park to show off for my friends. What I wasn’t prepared for was their reaction.
“HE’S WEARING CLOWN SHOES!!!!!”
My idiot friends didn’t quite grasp how cool the shoes (and their owner) were, but the jeers and laughter didn’t stop me: I was already becoming a committed Converse All Star wearer. I’ve now been buying and wearing Chuck Taylors for nearly 3 decades, which I would consider a resounding success for Converse.
Natural Demographic Movement
While precious little about the shoes has changed over my 30 years of patronage, a lot has changed about my personal demographics. I’ve aged, obviously, but also gone from single to married, from renter to homeowner, from in-store shopper to primarily online shopper, gone through a ton of different income levels, lived in 3 states, etc.
I imagine there are plenty of other individuals like me who have been buying the shoes for decades and have seen their personal demographics shift all over the map along the way as well.
Obviously Converse is an old, established, major brand, but let’s pretend for a moment they were a brand new company in 1993 selling primarily to 7 year olds. Let’s also assume they’ve continued to sell well to 7 year olds ever since. If those original 7 year olds in 1993 followed my lead and maintained their 30 year commitment to buy the shoes, Converse’s demographics would have expanded (or at least shifted) from primarily 7 year old buyers to 7-37 year old buyers. The fact of the matter is that if you develop lifelong customers, your audience demographics have to change as the members of your audience age.
Audience Expansion vs. Audience Retention
Based on the premise above, you could argue that audience retention is a form of audience expansion. If your audience sticks with you, the demographics of your audience will shift and “expand.” Of course, that’s not as fun, exciting, or fast as just suddenly breaking into a new demographic and seeing immediate success within that market. But how much easier is it to retain your audience than to break into a new audience?
From a cost perspective, it’s a lot easier. According to Harvard Business Review, audience acquisition is anywhere from 5 to 25x more expensive than audience retention. Obviously that initial shock statistic doesn’t tell the whole story, though – what happens when you spend 5x as much for new users in a new demographic who happen to have a higher retention rate than your existing demographics? The same article cites research showing that increasing your audience retention by 5% can yield an average revenue increase of 25-95%, so that extra cost on the front end may very well be worth it if you expect the new audience to buy in at a deeper level.
Where audience retention can be a lot harder than expansion is maintaining trust over the long haul. You need to make sure your customer service is on point, your quality doesn’t slip, you don’t cut corners, and you don’t deviate from your overall direction in a way that’s counter to your audience – and that last one may be the hardest point of all.
Back to my personal Converse example, I’ve been a loyal customer for about 3 decades. But I’m nothing like the 7 year old version of myself, and there are countless brands that I’ve left in the dust over that time period – not necessarily because they changed in a way I found unfavorable, but because I changed in a way they weren’t able to support.
- I no longer wear Franklin batting gloves, because I stopped playing baseball
- I no longer chew Bazooka Joe bubble gum, because I no longer have a set of adult teeth waiting to replace my broken baby teeth.
- I no longer buy switchblade combs, because I went bald
- I no longer buy Magic Eyes, because I was stabbed in the eye and lost the depth perception necessary to see the hidden picture
- I no longer subscribe to Sports Illustrated for Kids, because I’m an adult man and don’t want to be on a government watch list.
In most of those cases above, it would be a whole lot easier and cheaper to pay to break into a new audience than to develop the products necessary to grow with me.
Should I Cancel All Short Term Expansion Efforts?
Absolutely not. But don’t pursue new audiences at the expense of your current customers. You need to support those who’ve already bought in, and even start viewing them as another marketing channel to help you break into new audiences.
Have you ever had a friend, colleague or family member who is completely sold on a particular product and won’t stop talking about how it changed their life? Have you ever bought something because of one of these people swearing it will change your life? I’m pretty immune to external pressure, but even I have fallen victim to purchasing through this type of scenario. Word of mouth is still a super powerful persuasion tool, and I don’t expect that to end any time soon.
Treating your customers right can absolutely help you break into new demographics, whether by virtue of the fact your customers are sticking with you throughout their life changes, or because they are touting your commitment to quality and support to people who have never heard of you.
I guess that’s the moral of this article: treat people right, don’t be a jerk, and watch your audience grow like weeds.