Customer retention is the most necessary, cost effective and profitable strategy you need, and requires a combination of skills and tools to implement this strategy. This means you have to identify why clients would buy from you, what they need, what they want and why it’s important to them. This is especially true when you remember that 80% of your sales come from 20% of your customer. With these statistics why are most marketing and sales campaigns designed to acquire new customers?
And to make matters worse . . . many companies devise promotional campaigns that offer cost savings and benefits to new customers, whilst current customers pay full prices. Explain that one! They’re motivating their loyal clients to leave them and become new clients to a competitor just so they can get the special deals!?
Perhaps you need to rethink your marketing and sales strategies?
Many experts will tell you that it’s five times more profitable to spend marketing and advertising dollars to retain current customers than it is to acquire new customers. Many years ago customer loyalty and stickiness came naturally. We shopped in our neighborhood shops and our corner grocery stores. We had a personal connection with our service providers and the thought of shopping at another store would have never crossed our minds.
Things have changed. Stores are larger, sales people don’t know your name, and many people shop online. As a result, customer loyalty has disappeared and large corporations and virtual storefronts are unable to ask the millions of disloyal customers what caused them to stray.
How do you get SMART with your customer information?
Sophisticated technology and database marketing tools
Identify, manage and record client interaction and key information to gain an understanding of how your customers think. Establishing a detailed client database will allow your business to keep track of personal information and individual client preferences, so that you can provide better service and added value towards building personal relationships. You can now keep track of 20,000 customers through a customer database, and interact with them by name, as if you knew them personally.
With effective implementation of customer databases, you can re-establish contact with customers, and work successfully towards increasing customer retention, repeat sales, and customer referrals.
It’s not just about collecting information
To achieve the objectives of the database and customer retention programmes, your campaign should be designed and carried out with the customer in mind. The customer will participate if they associate some value with being part of your database. If they do not perceive value in your programme all of your communications, coupons, special offers, and newsletters will be discarded as junk mail or spam.
Sharing knowledge across your entire business
This includes customers, staff and partners. Make information transparent, easy to find and relevant. The best way to do this is through intuitive knowledge databases that allow you to share information from your website or Intranet. This will help eliminate time wasting searching for information across disparate systems such as shared folders and paper documents. You can improve staff productivity and customer support by making information easily available across the business from any location.