How much do you typically spend to acquire a customer? According to Lon Safko, the author of the book, The Fusion Marketing Bible, this figure can be anywhere between $7 to $315 among B2C businesses depending on your industry. Given this wide range, retaining your existing customers becomes extremely vital. It’s always cheaper to retain existing ones. Why? Because by increasing the lifetime value of your customers, you increase the returns on your investment. This gives you sufficient leeway to spend more, if need be, on acquiring new customers.
But retaining customers is hard work. Unless you are a monopoly in your industry, it’s a given that you lose customers on a daily basis. The lifetime value of your customer depends on how you handle your customers once you acquire them. This determines how long they stick with you before choosing to move out. So how exactly is this done? Here are some pointers to consider.
Keep customer experience special : You may not be able to afford the low prices that your big competitor provides. But you may well make the customer experience better. According to Jay Barnett, the founder of Australian startup, Priority Pickup, you need to take the transaction beyond the product or service to actually making their life better. It is difficult for a customer to cut off such a relationship as compared to a commercial engagement where they are in merely because of the low prices.
Talk to your customers : A lot of businesses take the advice about talking to customers figuratively and do it by merely setting up more newsletters and cold calls offering upgrades. This is spammy and only makes the customer want to move away from giving you more business. Instead, the ideal way to build a relationship is by asking them about their business, whether or not your product or service is helping them and identifying ways to make your product better for your customers. By involving them personally in identifying problems and solving them, you make them a stakeholder in your success. Customers rarely leave you in such a scenario.
Do not cut relationship after customer migrates : While you may offer the best service possible to your customer, you should also realize that your competitors are always on their feet trying to attract your customer to their product. As a result, it is a given that there will be a percentage of customers who may fall for the competitors’ campaign and thus switch their loyalty. That’s not a bad thing and you should not cut off contact with the customer. In a lot of such cases, customers who have migrated experience dissatisfaction over the level of customer service. As a result, it is quite likely to pull these customers back to your fold if you continue to enjoy a rapport with them. If that doesn’t happen, chances are that your competitor is offering something much more compelling than you – that’s an opportunity for building your product and/or your customer service.
What are some strategies you have used to retain customers? Tell us in the comments below.