Existing Customers are the Best Customers – Here’s How to Keep Them

Every business owner knows customer retention is imperative to the health of a company.  Sure, getting new customers is important, but maintaining your existing customers is gold. In fact, the probability of selling to an existing customer is around 60-70%.  Compare that to closing a new customer sale, which has a probability around 5-20%.

But even with this in mind, many business owners still tend to focus their efforts on attracting new leads and they leave customer retention up to chance. This is not a great idea, especially considering you’ll invest about five times more money into acquiring a new customer than you will retaining an existing customer. Put a different way, for every $5.00 you spend on attracting a new customer, you need spend only $1.00 on keeping your existing customer.

Customer retention does not have to be a complicated process, but it does require some follow through. It starts during the initial customer interaction and continues long after the sale is complete. Keep reading to learn how it’s done.

Building a lasting customer relationship naturally starts from the beginning of your interaction. Providing a first-rate customer experience is a given, but keep in mind the aspects of your interaction that will specifically help foster an ongoing relationship.

This probably seems obvious but it’s worth mentioning, particularly as part of customer retention. A feeling of trust enhances any relationship. And this is especially true of your customers.

It’s not hard, doesn’t take any special skill, and costs you nothing – Simply be honest with your customer and do what you say you will. Demonstrating your trustworthiness and authenticity will instill a feeling of confidence in your customer that they’re sure to remember after your transaction has completed.

Some business verticals are more complicated than others. Sometimes a transaction is done in 5 minutes, other times it could be a months-long project. No matter what your business model, don’t make the customer’s journey harder than it needs to be.

If your customer is forced to jump through hoops, deal with redundant or unnecessary communications, or is otherwise inconvenienced, it’s unlikely they’ll be looking forward to another interaction with you.

Anticipate your customers’ needs. Establish standard operating procedures for the various types of customer interaction and follow them each time. Make sure it’s easy and pleasant for your customer to do business with you and they’ll look forward to returning.

Everyone likes to be remembered, even especially your customers. Don’t run the risk of forgetting a customer–make lots of notes, keep thorough records and ask your customers for reviews. You can then use these records down the line to tailor your approach when you’re ready to invite the customer back.

When you reference a customer’s prior transaction or purchase it makes them feel important, like their experience mattered to you. This is how you make a connection and earn repeat business.

Now that you’ve set a great foundation during your first interaction with the customer, it’s time to maximize that effort and put in some follow through.

Keeping in regular contact with your past customers is the single most important thing you can do to promote customer retention. Even the best experiences will fade from your customer’s memory, so it’s important you remind them now and then that you’re out there, ready to serve them again. Now this doesn’t mean you need to spam them with emails three times a week, but a regular communication schedule is something you need to establish soon after the sale is complete.

The best communications provide your customers with something of value. Consider sending an invitation to read your blog, which should be full of interesting and helpful articles. Or send periodic updates about what’s happening in your field or new products you’re working with.

However, you choose to communicate with your customers, be sure you’re maintaining the positive vibes and keeping your company’s name at the front of their minds.

Staying in touch is great – and necessary – but if you send the same tired, “Come back and see us” email once a month for the next year, it’ll have little effect. In the section above we listed a few examples of communications you can send your customers and the focus was providing valuable content.

To carry that further, be sure you’re keeping things fresh and breaking free of the same generic emails or postal mail communications. Switch things up, keep your customers interested, and they’ll be much more likely to remember your name the next time they need services in your field.

An easy way to do this is by using various communications channels – not the same one each time. Plan a campaign that includes emails, text messages, mailers, and maybe even a quick phone call. Keeping things new and different will ensure your customers are interested in what’s next.

Who doesn’t like prizes, giveaways, and free stuff? Keep your customers interested by offering incentives for their repeat business or their referrals. And remember, incentives can be many things. Discounts and free services are certainly popular, but raffles, vacations, community events, or discounts at other local businesses can do the trick, too.

Consider the importance of the value of your incentive. Offering a $20 gift card is probably not enough motivation for your customer to sign on for a $20,000 remodeling project. On the other hand, a $1,000 weekend cruise might be just the thing – and think of the marketing possibilities! “Go on a cruise while we remodel your kitchen!”

Incentives are a great way of thanking your customers but more importantly, it keeps your company (and its awesome giveaways) fresh in their minds.

Companies that focus on customer retention are consistently more successful than companies that spend their money solely on acquisition. This has been true throughout time, even before the digital age. It’s especially true today though, when customers have so many choices at their fingertips. And now, existing customers are 50% more likely to try new products and spend 31% more money than new customers. Can you afford to miss out on that kind of profit?

Give your customers a great experience and then keep in touch with them after the sale is done. You’ll seethe results in your bottom line.

Looking to set up a great digital customer experience so you canfocus on retention? Locallogy would love to help! Drop us a line for a no-pressure chat aboutyour business.