Everyone says customer retention is a critical part of their business, but few actually follow through. Customers who continue to come back and refer friends are better than any advertisement you could run in your local newspaper. Unfortunately, most businesses are focused on new acquisition and usually ignore customer retention.
Here is an interesting statistic on customer retention:
According to Bain and Co., a 10 percent increase in customer retention results in a 30% increase in the value of the company. Wow, only 10%?
How will you get your customer retention moving forward? Here are a few strategies to make it happen.
Stay connected to sold customers. This can be done with newsletters, special officers and events. You know the expression: out of sight out of mind. A happy customer is likely to refer a friend.
Find ways to reward your sold customers– often. The other day I saw an ad for my cable carrier; the introductory price for new customers was really cheap. It’s a lot lower than what I’m paying. What do I have to do, opt out and go back in as a new customer?
Customer service is a marketing function. Marketing should look at all of their programs and make sure they are staying focused on sold customer. It’s been written that poor customer service accounts for 70 percent of customer loss. Customer service strategies should be pervasive throughout the entire company not just sales and customer service staff. Typically poor customer retention stems from bad leadership. If the owner doesn’t think, it’s important, why would anyone else? Customer service should be an ongoing conversation.
Quit talking and start listening! Try to tune into what your customers are saying daily. This way, you can stop problems before they begin.
I was buying paint at The Local Paint Store this morning. Lyle, the paint maven, told me not to worry about the age of my paint; as long as the paint wasn’t frozen it would still work. Wow, I said, I thought I would have to throw it out.
The paint maven said, “It looks and smells good to me!” I didn’t know the smell had anything to do with it; nice to know that someone cares about my pocketbook.
We are in the “participation economy: and we need to take our service to another level and constantly look for ways to be innovative. Consider finding ways to bring your customers together so they can share experiences with one another.
Lisbeth Calandrino has been providing business coaching for businesses for the past twenty years. Her new book, “50 Events to Drive Traffic to Your Store” will be available on Amazon in June 2014. To have Lisbeth to provide training in your store, reach her at Lcalandrino@nycap.rr.com or 518-495-5380.