CUSTOMER RELATIONSHIP
FOR SMALL BUSINESS
MARKETING AND MANAGEMENT
|
|
|
Relationship Marketing is key to your business
strategy. Use these resources to learn why it is important and
how you can improve the service you provide your customers and
clients.
|
Explore the Value of Customer Retention
Laura Schneider
Customer retention is not only a cost effective and profitable
strategy, but in today's business world it's necessary. This
is especially true when you remember that 80% of your sales
come from 20% of your customer and clients. With these statistics
I am wondering why most marketing and sales campaigns are designed
for the new customer.
Take for instance the wireless telephone companies; if you sign
a new contract you are given a large rebate or even a free cellular
telephone. If you are a current customer you have the privilege
of paying full price. Can someone please explain that methodology
to me. With this type of promotion are we not just pushing current
customers and clients to seek services elsewhere when their
contract ends?
Perhaps we need to rethink our marketing and sales strategies,
afterall many experts will tell you that it's five times more
profitable to spend marketing and advertising dollars to retain
current customers than it is to acquire new customers.
In years past the importance of focusing on customer retention
was not as important, stickiness came naturally. We shopped
in our neighborhood shops and our corner grocery stores. We
had a personal connection with our service providers and the
thought of shopping at another store would have never crossed
our minds.
That has all changed now. Our stores our larger, the majority
of the sales personnel don't know that you even exist. Not to
mention that now we have the convenience of the Internet and
do a large portion of our shopping online, where you are known
by your email address. As a result, customer loyalty has disappeared
and large corporations and virtual storefronts are unable to
ask the millions of disloyal customers what caused them to stray.
However, there is a solution. Sophisticated technology and database
equipment has made it possible for specialized firms to make
attempts at customer retention through database marketing programs.
Establishing a detailed client database will allow these companies
to keep track of personal information and individual preferences
of all their customers. This enables them to provide better
service and value. Just like the corner grocery store owner
kept information on 200 customers in his head, the large superstore
can now keep track of 20,000 customers through its customer
database. With effective implementation of customer databases,
companies will be able to re-establish contact with customers,
and will be able to work successfully towards increasing customer
retention, repeat sales, and customer referrals.
To achieve the objectives of the database and customer retention
programs, the entire campaign should be designed and carried
out with the customer in mind. The exercise will only be effective
if the customer recognizes and associates some value with being
part of your database. If they do not perceive value in your
program all of your communications, coupons, special offers,
and newsletters will be discarded. Your customers have been
inundated with meaningless "junk" mail and email spam,
so embed your campaign with value.
A few value-add strategies that you can use include:
- Membership cards and programs that entitle your customers
to special offers, discounts, or preferential treatment.
- Welcome, acknowledgement, sales recognition, thank you
statements.
- After sales satisfaction and complaint inquiries and surveys.
- Event oriented communications in which the customer is
genuinely interested.
- Enhanced and empowered customer, after sales, and technical
support.
|
|
