Customer Retention Strategies
Topic: Customer Retention Strategies
Without customers, your business simply would not exist. Some businesses are so focused on winning new customers that they often neglect to put any effort into retaining the customers they already have! Winning new customers is often far more expensive than retaining existing ones. Winning a new contract may cost time in terms of developing a sales pitch and cash in terms of corporate entertainment in order to win over your target client. By contrast, retaining an existing customer might be as simple as sending them a thank you card with a voucher enclosed offering 10% off their next purchase!
Businesses constantly strive to grow their client base and to do this they must go out and put time and money into sales and advertising efforts. It’s during these times that many businesses take their eyes off satisfying their current customers which can result in customers leaving. Customers of any business generally fall into three categories:
Loyal customers won’t leave for another product or service provider – even if a special offer is put to them. At the very minimum, they will give their existing supplier the opportunity to meet or beat the offer. Maintaining loyal customers is an integral part of any business. Over time it has been proven that loyal customers will spend more with you and they will refer new clients to you.
Satisfied customers are customers who are open to a better offer from the competition. They feel that the product or service they are receiving is on a par with other offerings on the market but they are open to switching to something better given the right opportunity / special offer.
Dissatisfied customers are not happy with your product or service. Some will complain, giving you the opportunity to target the customer with client retention measures. However, for every complaint that is received from discontented customers, there will be several who will complain to their friends or publish their complaints online. These customers must be targeted pre-emptively with customer retention tools.
The goal of any business is to move the customers up along the customer chain. Dissatisfied customers move to the satisfied category, satisfied customers move to the loyal customer category and the business continues to look after the life-blood that is the loyal customer category. Identifying and categorising each customer will take time and effort (hours analysing sales data). However, it will be worth the effort if it helps you retain some hard-earned clients.
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