As a business owner increasing your revenue is always on the forefront. But, what about retaining existing customers? What about cross-selling? It’s much more expensive to reach a new customer than it is an existing one.
I am all about creating great lead strategies that bring new customers/clients/patients in the door – as a matter of fact it’s what I do best. However, the first order of business in any marketing strategy is to first go after low hanging fruit. Are you getting the most you possibly can from contacts you already have?
The Turn and Burn Strategy
Only big box businesses can afford to focus exclusively on new customers – and even for them this strategy can backfire.
A great example is the way Charter Communications does business or as they are now known as Spectrum. My husband has went round and round with them for years and finally dumped them all together. Now we are a part of the new age of “streamers”.
Every year he would have the customary argument over them raising our bill an additional $6 per month. You get the introductory rate for one year and then they raise the price, you know the drill I am sure.
Yearly, like clockwork, my husband would threaten to cancel the service and of course he would get transferred to another person who I am sure was experienced in such calls. They would make a deal and all is well in TV land once again, that is until next year.
But last year, on our 7th year, apparently the jig was up because they were going to increase our bill and they weren’t budging.
My husband was furious and I being the most logical one at the time said, “Honey, let me speak to them.”
The woman I spoke with (I believe her name was Joy) was very nice and I politely asked her, “Joy, how long have we had an account with Charter?”
She replied, “7 years Mrs. Bridges.”
I said to her, “I have a question, what does Charter do to reward customers that have been with you for such a long time?”
Apparently she wasn’t trained to answer this particular question.But here’s the thing Charter knows – when it comes to Internet and cable people will always go where the deals are, so that is what they focus on. They will lose customers, but new ones will replace them immediately. This is their business model.
This type of business strategy however would run a small under-capitalized business right into the ground.
Yet, I see many do business this way. They have the business tactics of a Charter with nowhere near the assets and capital.
How to Hold Onto and Provide Value for Existing Customers
Too many businesses overlook the significance of staying connected with existing customers. If you want to hold onto existing customers and grow your revenues it’s you must understand the importance of retention. You need to put a strategy in place that encourages customer loyalty.
The first thing you need to understand is that humans now have the attention span of a goldfish. Just because they did business with you once, you should never take for granted they will again. Another thing you should never take for granted is they know ALL you can do for them. It is up to you to tell them.
Here are some tips for holding onto your customers:
- Ask for reviews of your business and really listen to what your customers have to say. People like to be heard, they like to know that their opinions and ideas matter.
- Be honest always. Always be honest with your existing customers. Be sure the product or service they purchased from you is of the best quality and always treat them with the same high standards you would a new customer you are trying to bring into your business.
- Stay in touch. This is what email marketing is good for, it helps you keep your business in front of their memory and reminds them of the complexity of your business offerings.
- Thank them for their business. Customers always appreciate it if you thank them for doing business with you; if possible send a written thank you note.
- Reward their loyalty. Perhaps can you provide them with free product or service, special discount, free upgrade to premium services and other value added services.
- Be better than your competitors. Provide your customers with services or products your competitors don’t provide. Go over and above when it comes to customer service. (A good tip here is to make sure you are reading your competitor’s online reviews on a regular basis, this can help you to find weaknesses in their business. Exploit their weakness by making sure it’s your strength.)
- Cross-sell strategically. Try to figure out what their other needs are associated with your product and offer it in a way that makes them understand you are focused on their needs not your own gain.
Here is a perfect example of cross selling strategically:
I am a huge fan of Ann Taylor clothing and I spend quite a bit of money in their store. Once I bought something online that didn’t fit or look good on me so I took it back into the store to return it.Ann Taylor has a great customer loyalty program and they reward people like me who really love the brand and spend money buying their clothing. So after I was done doing the return the sales person said to me, “Mrs. Bridges that blouse you expressed interest in that was sold out last month in your size has now been restocked and we have it in the store. Are you still interested in it?”
I was floored and so impressed. Of course I was interested!
I couldn’t figure out if I was more excited over them having the blouse I wanted or flattered that they knew remembered I wanted it. They track their loyal customer’s interests and buying habits.
Now this is what I call SERVICE.
Of course we can’t all be Ann Taylor’s but you can make efforts with your customers that produce the same outcome.
Questions for You to Answer
- Are you getting everything you can from your existing customers? Do they know everything you do?
- Do you stay in touch with your existing customers on a regular basis?
- Do you have a strategy in place to reward their loyalty?
- What are the advantages of doing business with you versus your competitor? What are their weaknesses? How can you make them your strengths?
- How do you know for a fact you are doing a good job with your existing customers? Do you ask for reviews?