Retention

What is a Customer Base, and Why Does it Matter for your Small Business?6 min read

what-is-a-customer-base,-and-why-does-it-matter-for-your-small-business?


So you’ve launched your ecommerce store; now what do you do? It’s time to build your customer base, of course!

You may be wondering what a customer base is, and why you should be interested in it. There are many reasons why growing your customer base is beneficial for your brand, but the most important reason is to start making sales to boost your revenue. Your customer base will be the key to your brand’s success, so learning about it and strategizing early in your business’ lifecycle is essential. 

Don’t worry—we’ll explain everything about a customer base to you, so you can start to strategize how you’re going to grow and retain it! Ready to get started?

What is a customer base?

A customer base is simply defined as your most loyal and engaged customers. When you have shoppers who consistently engage with your brand that fit your target market or ideal customer persona, you have a strong customer base. These shoppers may be loyal to your brand for a number of reasons: it could be because you offer them a product they want or need, because your brand’s messaging resonates with them, or they enjoy being involved in your brand community. Either way, they’re loyal to you, and that’s what defines a customer base. 

How do you define your ideal customer base?

Before you can start strategizing about growing your customer base, you’ll need to clearly define what your ideal customer looks like. You may want to start with asking yourself the following questions:

  • What is your products’ value proposition? 
  • What are the features and benefits of your product?
  • Why will a customer want or need to buy it? 
  • Who would you imagine as your perfect brand advocates?

Knowing these answers will help you clearly define your ideal customer base and who exactly you should be targeting with your marketing efforts. Also, creating buyer personas can help you understand your ideal customers better. 

“A buyer persona is a fictionalized characterization of your best customer(s) based on information about them and how they use your product or service.”

By outlining their desires, habits, pain points, demographics, and other characteristics, you’ll have an easier time knowing what may influence their buying decisions. Once you understand your product and your target audience, you’ll have an easier time selling to the right people. When it comes to your marketing efforts, easier always = better!

Identify SPIN to understand your target customer’s needs

Another useful technique to better understand your products and customers is to identify SPIN. If you’ve never heard of it before, SPIN stands for situation, problem, implication, and needs/payoff. Here’s the breakdown:

  • Situation: Outlining the initial and basic audience assessment, such as understanding your ideal customer’s demographics.
  • Problem: Identifying the customers’ needs or pain points, and how your product will be the solution to this.
  • Implication: Asking yourself questions like, “What would happen if the customers’ needs/wants are not met?” This will help you determine the stakes to communicate how important your products are to them. 
  • Needs/payoff: Understanding how the customer would feel if their needs/wants were met and how your products will lead to that feeling of satisfaction. 

Answering your SPIN questions is beneficial for a number of reasons. Not only does it help you shape your product and your messaging to sell to the right audience, but it also makes it way easier for your internal team to build the right kind of relationships with your ideal customer base. 

When you understand how to properly communicate with your customers, and if you’re reaching the right kind of customers, you’ll offer a better customer experience overall. This is beneficial since recent studies show that consumers are saying they’ll pay more for a good customer experience.

customers-value-good-experiences growing customer base 2020Source: SuperOffice

By understanding your customer’s needs, wants, personalities, and actions, and knowing how your product relates to these behaviors, you’ll definitely reach the right audience to grow your customer base and your brand properly—and that’s the bread and butter of every successful small business.

Why is it important to grow your customer base as a small business?

Aside from easing your marketing efforts so you can target the right audience, there are other reasons why it’s important to grow your customer base. In fact, growing your customer base is key for your business’ sustainable growth. 

As a small business, you’re relying on finding new customers; they are your brand’s lifeblood.

It’s no surprise to any ecommerce brand that they need to acquire customers in order to be successful. We know how good it feels when a customer finally makes their first purchase at your store, but it’s the magic that happens beyond that first purchase that turns shoppers into loyal members of your brand. When you implement strategies to grow your customer base, you aren’t just acquiring new customers, you’re also giving those acquired customers a reason to come back, engage with your brand beyond your products, and join an exclusive brand community. It’s about creating loyal brand advocates, and those are the people that refer new customers to you, continue shopping your products, and engage with you in a variety of ways—all of these lead to success. HubSpot breaks it down simply with their chart below; once you attract customers, they become brand promoters.

HubSpot - Growing Customer Base 2020

Source: HubSpot

Have you ever had an ad show up for you that doesn’t relate to something you’re interested in whatsoever? How annoying do you find these? This is a prime example of a brand not understanding their ideal customers, so they end up targeting the completely wrong crowd. It’s a waste of effort and budget, and it won’t lead to great results. So the key takeaway here is that understanding who your customer base is and strategizing for attraction and growth strategies will give your small business the fuel it needs to continue growing and make profit from people that will be genuinely interested in your brand and products. 

There are many tactics you can use in your everyday marketing strategies to grow your customer base. Think about creating a loyalty program to show your customers you appreciate them and increase engagement. Or, use social media to share new products and photos to start online conversations with people interested in your brand. There are many proven ways to grow your customer base without having to spend a lot of your marketing budget. 

Building a strong customer base is incredibly important for any ecommerce brand. When you have a loyal and strong customer base, it means you’re sending the right messages to the right people and offering the right products. A strong customer base equals a strong business, and that’s what every small or new ecommerce brand strives for, right?

Key takeaways to guarantee your brand’s success

  • A customer base is made up of your most loyal and engaged customers.
  • Asking yourself a few questions about your ideal customer can help you define your desired customer base.
  • Identifying SPIN will help you understand your products and ideal customer type.
  • Growing your customer base is important; your acquired customers are your brand’s lifeblood.

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This article was originally published by our friends at Smile.io.

About the author

Steve Hutt

I'm obsessed with entrepreneurship, commerce, and Shopify. If you have the desire to implement what's working today for direct-to-consumer brands on Shopify, I'm excited you're here! Get the Shopify help you need. This industry blog and podcast is my digital brain where my guests and I share cutting-edge marketing strategy, must-have Shopify apps, and marketing platforms that will help you build and scale lifetime customer loyalty. To do this, I'm part of the Merchant Success Team at Shopify Plus and host of the eCommerce Fastlane Podcast.