How To Create Customer Loyalty In Your Small Business
Maintaining a consistent customer loyalty base is one of the most important marketing tactics available to business owners, however many businesses overlook this vital customer loyalty strategy. It cost three times more to acquire a new customer compared to the cost for retaining one that you already have. Taking into consideration the life value of the customer, it makes perfect sense to focus on retaining the clients you already have, rather than consistently prospecting for new ones again and again through various marketing strategies.
The thing to note is that you have already spent marketing dollars on acquiring your existing customers; so all of the repeat sales from that database create a higher profit margin than it would for new clients because you do not need to spend another dime on marketing to them.
It is a myth that most of our customers “get stolen” by the competition. The truth is that only 9% of your customers leave because of competition; 14% leave because of unresolved complaints and dissatisfaction; some go out of business, some move away. All those reasons generally account for only 32% of all customers that leave you.
So what about the other 68%?
The rest of them leave simply because you never have taken the time to recognize them as something more than a customer. If you do nothing else but keep in contact with your past customers and treat them as your friends and acknowledge them once in a while, you’ll be putting the “golden handcuffs” on 2/3 of your customers; in the process, gaining a sure audience to sell to again and again without spending dollars on marketing.
It’s all about socializing.
From telephone and online to in-person interactions with current and potential customers, businesses need to implement successful strategies that result in positive retention numbers in order to survive in a competitive market. However, it takes some work to keep them around…. Here are THREE simple retention solutions your business can implement today:
1. Create systems in your business that boost customer retention and loyalty
One of the easiest and most effective strategies of maintaining a relationship with your customers is to stay in contact and communicate with them regularly through different media.
Implementing a monthly newsletter, perhaps, is a great way to communicate with your clients. It doesn’t have to be fancy and corporate looking, but it should be personable, informative, engaging and entertaining. A charming personality, character, humor and style are great ingredients for a successful newsletter.
There are many other ways to stay in contact and “communicate” with your customers, for instance:
- Sending thank-you cards for using your services,
- Sending gift certificates for upcoming occasions and holidays,
- Sending referral requests and other materials would remind them that you acknowledge them as your customer and are thinking about them.
2. Ensure Consistent Excellent Customer Service and establish “Satisfaction Policies” within your business operations
One of the most important customer retention tools, believe it or not, is Customer Service Excellence. If customers are happy with products and service your business provides, they will certainly go back for more. If customers are faced with traps and obstacles during business transactions and the experience they have with you (or your staff) is lacking in ease and enjoyment, they more likely take their business elsewhere.
Also, be sure that workflow processes are in place and working properly. Questions/concerns and requests for information should be handled promptly and online orders should be processed in a timely manner notifying customers about the process.
3. Engage with your customers in Social Media
Social networking is no longer “personal” – a lot of businesses are already taking advantage of the social media goldmine by opening a two-way communications with their customers. Most consumers are already on social media and while some businesses are debating whether social media is right for them, others are cashing in on the power of such platforms as Facebook and Twitter. Currently, social media is one of the fastest and easiest opportunities to retain customers by engaging with them on a “personal” level. Virtually, you can learn more about who they are and what they stand for… allowing for follow-up conversations. In fact, businesses who fail to see the relevancy of social media applications will soon find themselves behind the curve.
Social networking is the modern way of engaging with people in general. It is the most effective word-of-mouth marketing any business could hope for. Updating with company news, acknowledging a “fan” or offering promotions and contests are all ways to encourage message sharing; which in turn, builds your prospective client base and keeps your current customers engaged.
The most important aspect of retaining customers is to establish a bond with them both online and offline. Most businesses have the “offline” part of retention down – as they’ve been doing it for years. Now, as communications technologies grow and grow, retaining customers through online networking applications takes the guesswork out of the “online” part.