Why Most Brisbane Businesses Lose Money on New Customers
I see it all the time with businesses across Brisbane, from landscapers in Chermside to boutique shops in Paddington. They spend a fortune on ads to get new customers through the door, only to have those customers disappear after the first purchase.
If you're spending $100 to get a customer who only spends $80 once, you aren't growing—you're going broke.
To make real money, you need to know if the people who found you in January are still spending money with you in June. In the marketing world, we call this "cohort analysis," but let’s just call it what it is: tracking groups of customers over time.
Most business owners look at their total sales and think, "Great, the numbers are up!" But if those sales are only coming from expensive new leads while your old customers are quietly slipping out the back door, your business is a leaky bucket.
Here is how to stop guessing and start using real numbers to get customers who actually stick around.
The Big Mistake: Looking at the "Average" Customer
The biggest mistake I see is looking at averages. If you have 1,000 customers and they spend an average of $50 a month, that sounds fine. But that average hides the truth.
It might be that your customers from two years ago spend $200 a month, but your new customers from last month only spend $5. If you don't separate them into groups based on when they started, you’ll never see the problem.
By grouping customers by their "start date," you can see exactly when they stop buying. If you notice that most people stop calling your plumbing business three months after their first service, you know exactly when to send them a discount code or a reminder call to keep them on the books.
Mistake #1: Ignoring the "Month One" Drop-Off
I recently spoke with a gym owner in Milton who was frustrated. He was signing up 50 new members every month, but his total member count wasn't moving.
When we looked at his groups, we found that 60% of people who joined in the New Year quit by March. By looking at these groups separately, we realised his "onboarding" process was the problem. He was great at selling the dream, but once they signed up, he ignored them.
Actionable Advice: Look at your sales from six months ago. How many of those specific people have spent money with you in the last 30 days? If that number is low, your problem isn't your marketing—it's your follow-up.
Mistake #2: Treating Every Marketing Channel the Same
Not all customers are created equal. A customer who finds you through a Google search for "emergency roofer" is different from someone who saw a funny video on Facebook.
I’ve seen dozens of Brisbane businesses waste thousands because they didn't track the path customers take before they pull out their credit card.
You might find that customers from Google Ads spend $500 over a year, while customers from Instagram only spend $50. If you just look at the total sales, you might think Instagram is doing great because it brings in lots of "likes" or cheap clicks. In reality, it’s a waste of money because those people don't stay.
Mistake #3: Thinking This Is Only for Big Tech Companies
I hear this a lot: "I'm just a local sparky, I don't need fancy data analysis."
Rubbish.
If you run a service business, your most profitable work comes from repeat clients and referrals. If you know that a certain group of customers (say, property managers) stays with you for five years while residential homeowners only call once, you should be spending every cent of your marketing budget on getting more property managers.
This isn't about complex math. It’s about knowing which customers are worth your time and which ones are costing you money.
How to Start Grouping Your Customers (Without a Degree)
You don't need expensive software to do this. You can start with a basic spreadsheet.
1. Group by Month: List every customer who made their first purchase in January. 2. Track the Spend: Check how many of those same January customers spent money in February, March, and April. 3. Compare: Do the same for your February customers.
If you see the "retention" (the number of people staying) dropping off faster for the February group than the January group, ask yourself: What changed? Did we raise prices? Did we hire a new receptionist who isn't as friendly? Did we stop sending out our monthly newsletter?
The Real Cost of Getting it Wrong
Marketing in Australia is getting more expensive every year. Clicks on Google and ads on Facebook cost way more than they did five years ago. If you are constantly having to buy new customers because you can't keep the old ones, your profit margins will eventually hit zero.
I’d tell my mate the same thing: It is five times cheaper to keep a customer you already have than to go out and find a new one. By grouping your customers, you can see exactly where the "leaks" are in your business.
When you see which ads are making money over the long term, rather than just who clicked today, you can make smarter decisions about where to put your hard-earned cash.
What Should You Do First?
Don't try to overcomplicate this. Start small.
Step 1: Pick your biggest spending month from last year. Step 2: Identify the customers who started that month.
- Step 3: See how many of them are still active today.
Summary: Stop Chasing, Start Growing
Most of what you read online about "data analysis" is over-technical rubbish designed to make marketers sound smart. For a Brisbane business owner, it’s simple: you want to know if the money you spend today results in a customer who pays you for years, not just days.
Stop looking at your total bank balance as the only sign of health. Start looking at your groups of customers. It will tell you more about the future of your business than any other number.
At Local Marketing Group, we help Brisbane business owners cut through the noise. We don't care about "impressions" or "engagement"—we care about your bottom line. If you want to know which parts of your marketing are actually building a long-term business and which parts are just burning cash, we should talk.
Ready to grow your business with numbers that actually matter? Contact Local Marketing Group today