John Goodman wrote a great paper, based on Case Studies, on why your existing base of customers should be your focus for generating new business. Have a look at the 3 pages paper or read the highlight below.
Referral based new business ranges from 20% to 70% of all new business - depending on the industry.
A customers opinion of a Financial Institution is impacted between 21% and 29% through personal interaction, and only 1% by advertising!
When Financial Institutions offered proactive education, they increased Customer Retention by 12%, whilst decreasing customer complaints considerably.
Customers said that 1 in every 4 referrals they gave for Motor Financing, led to action.
If you have happy customers, rather spend money on leveraging their passion and recommendations than on advertising - as it is very much more effective. Also so some sums on your expected Return-on-Investment - what is the cost of a new customer through leveraging your happy customers versus launching new ad campaigns. This may shock you!