So many people are giving advice about how to generate more leads and close more sales these days, but I rarely see anyone talking about how to make sure that the customers you have stay until they are naturally ready to move on, or get them to make referrals to your company. This is crucial for growing your revenue.
Customers move on when they have outgrown your offerings, shifted their own business model, no longer need your products and services, or have gone through a merger or acquisition. These are ways that a customer naturally becomes a “former customer.” Your offerings no longer fit their needs. Even former customers, however, can remain loyal and refer significant amounts of business to your company.
There are some things that can cause a customer to leave when your offerings still fit their needs, and many of these exits may be avoidable if you have a Customer Retention Strategy that helps you maintain a positive relationship with each customer. Some of the reasons customers leave prematurely include poor quality, bad customer service, or unaffordable offerings. These are all predictable, and manageable, and the strategy will help.
A Customer Retention Strategy really starts before the prospect stage of a customer lifecycle. Having a really good definition for the profile (or avatar) of your best customers will help ensure a better fit for both the company and the customer. Not surprisingly, the better the fit, the longer the lifecycle of the customer. A company may be tempted to broaden this definition, especially when there is concern about meeting revenue goals with fewer prospects. In the short-term, this is okay as long as it does not change the definition of when your offerings are a good fit for a prospect. Otherwise, it can reduce the lifecycle of your customer base.
Here are five tips for creating your retention strategy:
- Be selective and target high value customers
- Get to know your prospects before you try to sell them a solution
- Listen to their comments, concerns, and complaints and learn from what you hear
- Make sure your offerings delight them
- Show appreciation, and reward loyalty and repeat purchases or referrals
How many times have you heard someone complain about poor customer service? Perhaps you were the one complaining. Good customer service goes a long way these days, when many feel underappreciated by those with whom they do business.
Loyalty programs, referral fees, and discounts for repeat business are all ways to retain a customer once they have been delighted, but these will not retain a customer if they are unhappy with their experience. Provide stellar customer service, and make sure every interaction and experience they have is a positive one. The customer may not always be right – and you don’t have to fall on the sword if they are not – but some diplomacy will go a long way.
If you don’t retain customers and keep them coming back over and again, your revenue growth will take longer and your marketing efforts will be more difficult and expensive. Make sure you have a strategy that makes prospects want to do business with you, makes it easy for them to do so, and keeps customers coming back for all of their related needs.
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