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How to build your customer database as a small business owner

Building your customer database should be a process that never stops. But there are better and worse ways of going about it.

“Always be closing.”

Always be closing—the mainstay of Salesperson Youtube motivational videos for years. But there’s a key step before sealing the deal, which Alec Baldwin missed out.

“Always be lead generating”.

It doesn’t quite have the same ring to it, but building a customer database is absolutely critical to the success of your early-stage SaaS business.

Continuously bringing in and qualifying new leads should be an eternal focus. No matter how many clients you’ve taken on, no matter what stage of MRR you’ve achieved, if you stop growing, you start failing.

Building your customer database should be a process that never stops. But there are better and worse ways of going about it.

Buying a list – should I do it?

A standard go-to option in the past, especially in the era of Direct Mail or the early days of the Internet, was to buy pre-prepared data lists from third parties.

These lists often profess to provide up-to-date contact details for thousands of “hot leads” in your industry sector.

The truth, however, is that these leads are often disappointing. In some cases, they can even do more harm than good.

Data lists often contain inaccurate or legacy data. Contacts may have left the company years ago, or have no interest at all in your sector or product. Targeting these ‘leads’ can often be a waste of time and resources. In fact, the estimated waste of resources from targeting defective data with marketing efforts sits at a whopping $611 billion per annum across the USA.

If that’s not enough to make you think twice about aiming your best marketing campaigns at a pre-paid list, consider this. On a practical scale, sending emails to defective data results in high bounce rates. High bounce rates of your email campaigns mean a poor email deliverability rating. This will affect future email campaigns, making it more likely for your emails to end up in your prospects’ spam folder – no matter how solid the new data or how awesome your new subject line is.

That’s the lowdown on pre-paid lists. So what are the best alternative methods for building your customer database?

Gate your best content behind Forms.

In today’s hyper-competitive SaaS industry, prospects have no shortage of platforms to choose from. You must offer value to them first with your Marketing efforts.

Lead Magnets and Newsletters are a great way to offer value upfront. You could release quarterly reports summarising industry news, best practise eBooks, or newsletters summarising interesting blog posts from the past month—all of this value just in exchange for your prospects’ email addresses. Seamlessly captured via your form to unlock the content and added straight into your customer CRM.

Meet your prospects where they are with a Live Chat widget.

No SaaS platform should still be hiding behind a ‘Contact Us’ form. Today’s prospect doesn’t want to wait one to three days to hear back from your Sales team, and they demand faster responses. Offering a Live Chat widget is a great way to meet your users exactly where they are in their journey and offer them the opportunity to ask questions there and then. Better still, proactively engage hesitant visitors with Prompts to start conversations on your most visited pages.

Just make sure your Live Chat widget of choice includes an email capture function. That way, no matter whether you have an Agent immediately available to answer the chat message, you’ll have the prospects’ email to add to your database for future follow-up.

Starting a referral program

Companies with established referral programs achieved 86% higher growth over two years than companies without. There’s no better way of adding solid new leads to your database than via word of mouth from your existing customers.

It’s crucial to have a referral program in place for this. Customers are often willing to refer based on positive experiences, but unfortunately, they rarely get around to it. Or worse, platforms don’t offer them the ability to do so! Offering incentives is a great way to build a solid referral program and fill your sales team’s pipeline with hot leads.

Run some in-person events

Remember these? Depending on where you are in the world, in-person events are becoming a thing again. Successfully networking at these occasions can be an absolute goldmine for building your database.

Again, just as you offer an incentive in exchange for an email address online, don’t show up to these events empty-handed! Instead, why not come up with a creative incentive to get your prospects’ business cards ‘IRL’. A business card in exchange for a champagne raffle often proves to be a winner 😉

Drive leads with organic traffic.

I’ll say it again; offering value upfront is the best way to build your customer database. So many SaaS companies seem just to expect prospects to find their own way to the sales page, be wowed by the sales copy and jump to sign-up immediately.

The truth is, building consistent lead traffic to your site requires commitment. Consistently releasing quality content, such as blog posts or LinkedIn articles, is a great way to nurture organic traffic to your site.
You can also get more creative with your channels. At GoSquared, our team regularly engage with SaaS Reddit and Indiehackers topics, building our reputation by offering value to our target community. Our CEO James Gill also releases a Podcast about the daily life of a SaaS business owner – sharing tips, stories and lessons from his journey so far.

Keep your Notes updated!

Here’s a boring but important one. Any decent CRM should allow your team to add notes onto customer profiles in your database. This can be a great way for your Sales or Customer Success teams to provide additional data about your prospects and customers.

If your Sales agent discovers the prospect has a particular pain point, they should add this to the notes to ensure the CS agents help the company meet that need. Your team can even add more nuanced information, such as your users’ favourite holiday destinations or hobbies. This helps your CS team build rapport over time or send gifts you know your customers will love.

Going above and beyond with your customer service can be a superpower if you do it right!

Keep iterating every single week. 

We’ve said it before, and we’ll say it again; the work of building your customer database is never done. Your Sales team’s pipeline can never be too full!

As a SaaS founder starting out on your journey, it is crucial to implement and iterate on the right channels to build your customer database and fill it with new leads.

Building optimised lead generation processes is a vital (and sometimes pretty fun!) business development process. Just make sure not to neglect your existing customers!

Written by
Chris is the Customer Success Lead at GoSquared and is here to share everything he knows about keeping your customers engaged and happy!

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