Whether you call them customers, clients, patrons or something else altogether, nothing is more important to your business than the folks who buy your products and services.
But that importance does not evaporate after a customer’s first purchase. In fact, according to the book, Leading on the Edge of Chaosby Emmet C. Murphy and Mark A. Murphy, the value of each customer increases over time because:
- Acquiring new customers can cost as much as five times more than satisfying and retaining current customers. (This number can vary greatly depending on industry and offerings).
- Customer profitability tends to increase over the life of a retained customer. In other words, they buy more as their trust increases.
- A 2 percent increase in customer retention has the same effect as decreasing costs by 10 percent.
- Depending on the industry, reducing your customer defection rate by 5 percent can increase your profitability by 25 percent to 125 percent.
Given those statistics, keeping your current customers coming back for more, or Customer Retention, should be paramount for any business.
One key to retaining your customers is to figure out why you lose them. Here are the top factors, according to a study released by the U.S. Small Business Administration and the U.S. Chamber of Commerce:
- 68 percent leave because they are upset with the treatment they’ve received.
- 14 percent are dissatisfied with the product or service.
- 9 percent begin doing business with the competition.
- 5 percent seek alternatives or develop other business relationships.
- 3 percent move away.
- 1 percent die.
While there’s not much you can do about a dying customer, there is alot you can do to make your customers feel well treated so they become less likely to take their business elsewhere.And at the core of all great customer service are the online relationships you build and maintain with each of your customers.
Building Customer Relationships Online
The Web is a great place to build customer relationships, even before someone becomes a customer! You can provide value before a sale by providing information and answering questions that help potential customers come to a purchase decision.
Whether you do this via inbound content marketingon a social media site (likeTwitter, Facebook or LinkedIn) or via email marketing, you are cultivating trust. And you will build the most trust by creating, or curating, valuable content that:
- Provides help while asking for nothing in return, and
- Establishes your subject-matter expertise.
Why is trust so important? Because people don’t buy from businesses they do not trust.
You can learn more about building relationships online by following these links:
- Secrets of a Twitter Networking Guru
- Become a Content Curator to Build Your Social Media Presence
- The Three D’s of Social Media Marketing
- Three Keys to Building Lifetime Value
Maintaining Customer Relationships Online
Once a potential customer becomes an actual customer, they are yours to lose. They have put their trust in your business and its products and services. If you let them down, they will leave. Sohow can you keep your customers happy and turn them into long-term repeat buyers? You can maintain the customer relationship through fulfillment, support and regular contact.
Once a purchase is made, your customer wants to know one thing: when will they receive the product or service for which they paid?
For successful fulfillment, you need to give as much thought to the post-sale process as you have to the pre-sale process. Your customer is expecting information from you and you had better deliver.Luckily, most online e-commerce solutions can be configured to send enough information to satisfy your most demanding customers. From order confirmations to shipping and tracking emails and text messages, you should set up your solution to hold a customer’s hand until delivery.
For more info on making a good first impression, take a look at these links:
- 5 Ways to Turn New Customers Into Loyal Customers
- Making Online Transactions Easier for Your Customers
- MAGIC = Making A Great Impression on the Customer
- How to build strong relationships with new customers
The most critical time in any customer relationship is when something goes wrong. If you handle the situation well, you can make huge strides in the relationship. Handle the situation poorly and you risk losing a customer.
But the Web gives you many ways to offer customer service:
- Let your customers reach you by:
- Listing your contact numbers and emails on your website.
- Providing an online form for asking questions and reporting issues.
- Including the ability to hold a live chat on your website.
- Making use of one of the many feedback and ticketing solutions available online.
- Give your customers the ability to resolve their own issues 24/7 by:
- Creating a searchable knowledge base with common questions and answers.
- Adding a discussion forum where customers can help each other or get help from you during normal business hours.
- Allowing customers to view updated order information online.
You can learn more about giving great support by following these links:
- Seven Mistakes You MUST Avoid to Give Great Customer Care
- The Forgotten Elements of Providing Great Customer Service
- How to Make it Easy for Your Customers to Contact You
- The gift of a customer complaint
Contacting your existing customers on a regular basis is a great way to stay on their minds. The key to doing this successfully is creating a realistic schedule — do not contact your customers every day — and to provide value along with any promotions.For example, you could use an email newsletter to send useful content, either written by you or curated. A newsletter should help customers use and care for a product that they purchased from you.
Direct sales businesses (typically business-to-business folks) can also make use of an online customer relationship management (CRM) system.
CRM solutions allow you to track all interactions with a specific customer (phone, email, etc.) and also provide the ability to create reminders so you’ll never forget when it’s time to reach out and contact that customer.The latest CRM solutions allow you to track social media activity as well as the more traditional interactions mentioned above. You can learn more about this type of solution in the post, The Race to the Top of “Social CRM.”
Use the links below to spark some ideas about how you can continue to provide value to your customers:
Happily Ever After
In the end, the relationships you have with your customers are based on the same three principles as your personal relationships:
Keep those in mind, use them in practice and your customers are sure to stick around for a long time.
Matt Mansfield is not a Pitney Bowes employee and is a paid contributor to the pbSmart™ Essentials blog.