Why (and how) you should be thanking your customers
According to Bain and Company, one of the world’s top management consulting firms, it costs a business six to seven times more to earn a new customer than it does to keep an existing one. What’s more, the probability of a sale from a brand-new customer is only five to 20 per cent, while the chances of selling to an existing customer is around 60-70 per cent.
It makes sense then, that as a small business owner, your goals for 2018 should include working at least as hard at keeping your current customers as you do on attracting new ones.
Why do customers stop frequenting a business? A study by the Rockefeller Society shows that the answer is actually quite simple: more than 80 per cent of customers say they leave because they believe the company doesn’t care about them.
You could say it comes down to the golden rule: do unto others as you would like others to do unto you.
If you’ve noticed a slip in regular customers – or even if you haven’t – you might want to consider creating a Customer Appreciation Strategy. Besides making customer appreciation an official facet of your overall marketing strategy (which will help remind you to give it the focus it deserves), an appreciation strategy can bring your business three benefits:
1. It can increase your value in the market. Satisfied customers tend to give better reviews of your business, signaling to potential customers that you’re better than your competitors.
2. It can raise customer loyalty. Appreciated customers are loyal customers. They enjoy their relationship with your company and don’t want to do business elsewhere – even if someone else offers the same product or service for less. (Feeling appreciated can trump lower prices).
3. It can bring higher profits. Loyal customers – and customers who have been with you for a long time – are more likely to continue buying from you in the long term. In fact, it’s projected that 80 per cent of your future profits will most likely come from 20 per cent of your existing customers.
Making customer appreciation a priority is your first step. The next step is to show it. Here are 10 simple strategies:
1. Send baked goods. Here’s an old-fashioned method that still works wonders. Who wouldn’t feel special when chocolate chip cookies suddenly arrive at the door?
2. Cut the red tape. Give the VIP treatment and let your best customers know they can deal directly with you at any time.
3. Mark unique occasions. You don’t have to resort to stalking to keep your business top of mind for your customers. Find real reasons to contact them, like Groundhog Day (send a card) or National Ice Cream Day (deliver a litre of Rocky Road.)
4. Refer customers. If your clients are also businesses, link to them on your website or Facebook page, send other customers their way, or provide them with your own testimonial.
5. Open up your space. If you have it, provide a room where a small group could meet up. It’s a helpful gesture and some group members could turn into new customers.
6. Discount their bill. For no reason and on a random occasion, surprise them by taking a few bucks off their invoice.
7. Wow one customer. Do something super-over the top (think West Jet surprising a handful of customers with return tickets to anywhere). The word-of-mouth publicity as they share the experience will be worth the extravagance.
8. Visit out-of-town customers. If you travel and happen to be in their city where they have a business, drop in and take them out for lunch or coffee.
9. Get personal. People like dealing with people, not corporations. Send a card marking a birthday or the birth of a child, or send a Christmas card that includes a photo and a few words about your own family.
10. Give exceptional customer service…always. Make great customer service business as usual, and you will be thanking your customers with every single transaction.