How to Build Customer Loyalty
As many business owners know, it’s more expensive to find a new customer than to keep an existing one. In fact, according to Bain & Company research, it’s six to eight times more expensive to gain a customer than to retain one.
New customer acquisition involves advertising, promotion and sales expenses, new account set up and other investments of your time and money. Conversely, established customers can actually make you money via referrals. In fact, the most loyal customers often serve as informal “ambassadors” for your company just by talking about your products and services with their colleagues. The Bain study supports this idea, noting that by boosting customer retention by just five percent, you can reap a profit boost as high as 95 percent.
This is why customer loyalty is so important — and it’s especially crucial in challenging economic times. Loyal customers are likely to buy more products and services from you and share positive experiences about your company.
It’s one thing to be accommodating to customers and try to keep them satisfied. It’s more effective to create specific programs designed to increase their loyalty to your company. Here are five strategies to help you strengthen customer relationships, retain business and get referrals:
1. Focus on service.
Does your business culture support exceptional service? Are your employees on board with a “can do” service philosophy? Service often trumps price when it comes to loyalty, so take steps to make your customer service a stand-out advantage for your business.
2. Respond quickly.
For customers, there’s nothing more frustrating than waiting for a resolution when something’s gone wrong. Savvy businesses view customer complaints as opportunities to wow customers and win back their business. Research shows that customers who feel their complaints are answered quickly and fairly become even more loyal.
3. Create an affinity program.
It’s surprising how quickly customers embrace frequent buyer programs — and how willing they are to carry multiple cards and key fobs to earn a punch or a swipe toward a free or discounted item. But it’s not just retail establishments that can benefit from such programs. Almost every business can create some kind of affinity program. Brainstorm with your managers to see how one might work in your business.
4. Stay in touch.
Stay top of mind with your customers by reaching out to them with consistent, strategic “touches.” Implementation depends on your type of business, but a periodic e-newsletter campaign, link to a relevant article or an informative Facebook update can remind customers of your value and interest in their business. Share news or ideas that will make their lives or jobs easier.
5. Set realistic expectations.
You’ve no doubt heard the phrase “under-promise and over-deliver.” This is one of the keys to customer loyalty. Your customers need to know that they can count on you to do what you say you’re going to do, and that your products and services are reliable and worthy of their investment, large or small.
Complacency is often the enemy of customer loyalty. Be proactive in keeping your customers not just satisfied, but fiercely loyal as well.
Because we know your business, we can help you brainstorm ways to increase customer loyalty. Call us for more information.