Customer loyalty and retention

It’s been said that it can cost up to 5x as much to win a new customer as it does to keep an old one. Customer retention is the life blood of any business, a business that grows from gaining new customers but also from sustained repeat business - customer loyalty. Our new article looks at how to do this successfully.

So what is the correct split between your marketing budget and your customer retention and service resources? Unfortunately there is never going to be an easy answer to this but over the next few hundreds words we’re going to look why you must consider both and not forget about the customers you’ve dealt with previously in a mad rush to get in front of new ones.

Is it customer service or customer retention?

These are not mutually exclusive. It’s going to depend greatly on your business model and personality of your company as to how these are defined for you. Both are directly dealing with your prospective and existing customers but don’t forget that happy customers are likely to ambassador you new business too. Without good service and great relationships with your customers they will walk out of your door and look for another deal next time they need a _____ (enter your product/service here) and they probably won’t tell their friends either…… unless of course it's to complain about you!

French cafe outside seating

The cost of a customer

Have you ever worked out what one single customer is worth to your company over a life time of repeated business? By that I mean you and your customer engaging in a mutually beneficial relationship where customer feels respected and cared for enough to part with their hard earned money based on their previous experience with you. Loose their trust and that life time of business goes else where.  Find out this number and you will quickly realise why it's so important to retain your customers.

A culture of great service

As well as the lowest price, the best quality product and the biggest and cutest stuffed Meerkat, your customers will return time and time again because of your service. They will feel loyalty when they have a personal relationship with your brand and the people that convey your brand. A fundamental of customer service is having a business culture where your staff are willing to go the extra mile for every single customer, every time. Build your business on the bedrock of excellent service and suddenly you will find that customers return. With or without a Meerkat…

Be of value to your customer (and make them feel valued too)

How can you be of value to your customer beyond being the company that provides the thing they’re paying you for?

Cake shop delivery

No complaints is a good thing right?

This is very true of course unless …… you have unhappy customers who are just not letting you know. And don’t think that just because they aren’t telling you, they’re not telling their friends either. They are probably shouting about you right now!

Are you making it easy for your customers to communicate with you when something goes wrong? Are you brave enough to even encourage it? Think about this - you could give your customers the best experience ever and make it easy to complain! This way you can make friends again by bending over backwards to fix the issue and you could even do it public via Facebook – this way everyone will see how well you handled it. Not only will you keep the custom of your new friends but you can use this data over time to really get to grips with the processes in your business that are letting you down.

For all the loyalty cards in the world – we buy the coffee that is closest to our office right? If you want your customer's loyalty to walk them that extra 20 seconds to your ‘casa di caffè’, you need to be really special.  

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