Finding new customers costs more than retaining the ones you have. Keep your customers happy, and spending, with these 7 tips.
Every company needs to work harder to retain the customers they have. That's the lesson learned from these two interesting facts recently brought to light by an EMarketer survey:
A sale to an existing customer costs between one-sixth and one-seventh the price of a sale to a new customer.
Three times as many companies cited customer acquisition as their primary marketing goal as those who cited customer retention.
Of course, every company needs new customers if they want to stay in business, but focusing efforts only on the sales coming through the front door is not only leaving money on the table-it's throwing extra money into the pot after you've already folded your hand. Don't do it. Keep the customers you have, and keep money in your pocket, by following these seven dos and don'ts.
Do check in periodically with everybody you've ever done business with. Research by Bain & Company reports you can expect to lose half your customers over a five-year period if you don't make regular contact. This contact can be as simple as a coupon in the mail, or as impressive as a personal call from management.
Don't wait until there's a problem to make contact. Customers who only hear from you when they complain begin to view you as a public relations flack. The best customers become friends over the long haul. It's good policy to call a friend once in a while just to say "hi."
Do start a loyalty program. Offer discounts or special privileges to your repeat customers. Run the math and you'll see what a good deal this is-you'll almost always make more money on your repeat customer, even with a discount-not to mention you're rewarding your loyal customers by offering them something special.
Don't treat everybody the same. In a small shop, you can go as far as keeping notes about a customer's likes, dislikes and family so you can ask about them the next time you see the customer. Larger operations can't pull this off as easily, but something as simple as keeping track of how long they've been your customer-and mentioning it with a thank you-shows you view them as more than just a note in your profit-and-loss report.
Do ask for feedback. A recent Harvard Management survey found that 80 percent of companies believed they offered above-average customer service. Just 8 percent of customers of those companies agreed. The last thing you want is a good customer who's silently seething over something you don't know about. Be prepared to handle any complaints you find quickly and in good faith.
Don't take loyalty for granted. It's your job to continually remind your customers why they keep coming back. This is even true-maybe even especially true-of your die-hard "superfan" customers who've been coming back for years. Those are your best brand ambassadors, so never even think about giving them less than you would a brand-new face.
Do embrace social media. Facebook, Twitter, Google+ and Pinterest have made customer engagement exponentially easier and cheaper than even 10 years ago. Whether you're sharing news, soliciting feedback or simply chatting, these platforms give you a free conduit to your most engaged customers.