5 tips for increased customer retention

In times of economic molasses, it’s important for businesses to shift sales gears from customer acquisition to customer retention. Most companies know approximately how much it costs in advertising and marketing to attract each new customer. Currently, the average cost per new plumbing/HVAC customer is around $230. By refocusing your selling strategy on repeat business rather than new business you can quickly cut acquisition costs and increase revenue. Use these tips to get the most from the customers you’ve already paid for, and hopefully lower the costs associated with bringing new customers on board.

You’re too reactive – It’s easy to become swamped with work, frustrations and anxieties while out in the field or in the office. Don’t let this turn your decision-making process into a reactionary one. Instead, focus on ways you can be proactive in your customer communications to avoid any knee-jerk reactions that may cost you a sale from a long-time customer. It may even be beneficial to script out responses to frequently asked questions in order to remind employees how they’re expected to handle and react in common situations.

No reason to call back – The key to driving repeat business is knowing your customer’s buying cycles – which will help you dictate when to run different types of promotions. In the retail world, a customer will visit a department store or website five times or more before actually making a purchase. Many times these visits are so they can simply see what’s changed. Keep this in mind with your customers. If you ads are stale or your promotions are non-existent, your customers are more likely to shop around before they call. However, if you can keep their interest through newsletters, emails, changes on your website, etc. they will be more inclined to call you first when they are in the market to buy your products or services.

You don’t know your customer – Despite your best marketing efforts, your message will never convert to another sale if you don’t have your customer’s correct information. With people constantly changing their contact information it’s likely that 15% or more of your current client information is incorrect. Enforce a customer update policy company-wide. When any employee communicates with a customer, have them verify their contact information.

Your customer service stinks – According to a recent retailer survey, “Companies that place emphasis on quality, customer intimacy and revenue generation stand to reap the greatest competitive advantage and return on investment… Improved quality of service correlates directly with customer satisfaction.” To see what you’re actually delivering to your clients, put yourself in the communication process with your company. Plan an unexpected call to your main customer service line and rate your own experience. How would you rate your customer satisfaction? What can you do to improve it? By mapping out a clear and concise strategy aimed at the customer experience, you’ll keep your customers happy and coming back.

Your first impression may be their last – It’s been said countless time, “you don’t get a second chance to make a first impression.” That solid first impression is your key to capturing more repeat business. You never know when an existing small customer may turn into your next million dollar account. Give all your customers a reason to call you again with a solid communication, purchasing and fulfillment plan.

Don't just survive – Thrive!

We may be in the midst of a recession, but not all is doom and gloom. In fact, it's important to remember that many of the largest companies around today were started during depression eras. In fact, the Great Depression created more millionaires than any economic times to date.

The Federal Government defines a recession when we experience two consecutive quarters of negative Gross Domestic Product (GDP) growth. What this translates to the business owner is a general slowdown in business activity and consumer spending - but it doesn't have to be that way for you.

Hope is still there for the small business owner – companies who spend wisely during economic slowdowns can actually thrive and come out of recession periods stronger than ever (think Microsoft, GM - not the current GM, but the one 10 years ago, General Mills). The key to working a slow economy to your favor is simple: take advantage of your competitor’s cutbacks by marketing aggressively. Companies that continue to spend on direct marketing will continue to grow, even during a recession. Because many business owners reduce or eliminate advertising budgets during slow economic times there are fewer companies competing for business. Which translates into a higher impact on your marketing. If there are fewer businesses competing for a fixed market, odds are in your favor that any advertising efforts will have a higher impact, allowing you to capture a greater portion of the market.

The important thing to remember during economic slowdowns is that consumers don’t stop spending. They may look for better a better deal or be more selective which whom they spend there money, but they are still buying the goods and services they both want and need. This is why it’s also important to focus your marketing efforts on customer retention, not just acquisition. Use your advertising budgets to find ways to show your customers how well your business is doing – or the savings you’re providing them. Keeping in front of your clients in this fashion will add additional value to the products and services you provide. Cutting back budgets and reducing your exposure can cause clients to feel abandoned, create a sense of financial mistrust or a lack of staying power.

Turn off the news and put on your marketing cap. Brand your way to a bigger, better business.