In Part 1, I explained that when it comes to leads, rather than the more the better it is the quality of those leads that counts. The best leads are those prospects who are seeking you. Other good leads come from referrals, lapsed customers and by finding prospects similar to your best customers. It is also possible to find customers directly through a one-step selling process. I also looked at seven simple methods to increase your conversion rate.
However, the most under-rated tool in increasing your number of customers is to minimise those who leave. You can never get this to zero as some of your customers will die, move out of the area or go out of business. However, these are not the reasons most customers leave. The simple answer is a perceived indifference on your customer’s part. In other words, your customers are comfortable doing business with you but they will also be just as comfortable doing business with someone else. This is a dangerous position for your business. You are vulnerable to your competitors coming up with a lower price or a better offer.
If your customers are loyal, they are more likely to stick with you even if your competitors try and steal them away from you. You must ask yourself, how loyal are your customers to your business? In today’s climate, loyalty is a lot harder to earn than it once was.
Here are three examples of declining loyalty in today’s society than say, 20 or 30 years ago.
- Employees spend less time with the same employer.
- Football players switch clubs more frequently than in the past.
- More people move to another suburb, another state or even another country than ever before.
It would be easy to say that money is the reason for a decline in loyalty but there is more to it than that. The big change is competition and choice. 30 years ago, there was only one telephone carrier. Now, you can choose from over 100 suppliers. The real skill in business today is with all this choice available to your customers, how are you going to convince them to stay with your company. If you do this well, then it becomes easier to obtain new customers, but more importantly, it is more profitable to do so. The longer your customers stay with you, then the more you can afford to spend in getting a new customer.
So, how do you convince your customers to stay with you? The first thing you must do is to develop the right attitude. You’ve got to really want your customers to continue to be with you. Most companies don’t have this attitude. Here are seven ways of reducing the number of customers who leave your business.
- Give exceptional service. It is easy to pretend that you do but a lot harder to carry it out. The best thing you can do is to exceed your customer’s expectations. Stop for a moment and think when did a company do more for you than what you expected. Exceeding your customer’s expectations is so rare that when you do it, you really stand out.
- Handle complaints well. Treat complaints as an opportunity to shine. Listen to your customer and then fix the complaint quickly. Avoid confrontation. It is unlikely you are going to win. A dissatisfied customer will tell 5-10 times more people than a satisfied customer about their experience. Most complaints are going to be small ones. Empower your staff to solve complaints quickly. Again, do more than is expected. Apologise. This is very rare in business. Instead, most businesses will say something like this. “We accept no responsibility for this situation but as a measure of good faith we will fix the problem by doing this for you.” Well, I can tell you this sort of statement impresses no-one. Admit the mistake and then include a gift and a proper letter of apology. Your customers will be impressed because this is very rare in business today.
- Develop a customer loyalty program. If you read my emails regularly, you know the two examples I regularly refer to are QANTAS and Baker’s Delight. Both companies have formal loyalty programs in place so that you feel locked in to buying from these companies in the future. You do not want to miss out on a free flight or some free bread so you keep buying from the same supplier to get your rewards in the future.
- Retell your marketing story. Do not assume that having convinced some customers to buy from you for the first time, they will automatically buy from you in the future. You need to sell them on this idea again and again. List the benefits of your products. Show genuine testimonials. The second sale is the important one.
- Make special offers to your customers. Offer discounts, free gifts, free information, competitions or other incentives to buy from you. This works best if you say this offer is limited to preferred customers like you. Make your customers feel special.
- Contact your customers regularly. This is a big one. This is the best way to show your customers that you really value them and want them to stay with you. It is also important that you have contact with your customers for reasons other than selling. Send your customers a gift, a birthday card, a Christmas card or a calendar. You can also write an email or even a monthly newsletter with free information relating to your industry. This gives you the added benefit of setting you up as an expert in your field. This is a great way of differentiating yourself from your competitors.
- Use multiple media both for marketing and for sending free information or free gifts. People respond in different ways. Take advantage of the technology available. Use direct mail, your website, emails, fax broadcasts and if possible visit your customer in person. You need to stay at the forefront of your customer’s mind. This gives you a better chance of fending off other marketing from your competition.
Increasing your number of customers is what makes companies successful. These are a few ideas but you should study what your competition is doing. Also, look at what other businesses are doing in other industries. There is every chance you can adapt what they are doing to your industry.