How to keep customers loyal

How to keep customers loyal

April 19, 2012 by Matt Bird

Recently I wrote about understanding and calculating your own customer retention and customer churn figures. These figures are crucial performance indicators and if you have no idea how many customers buy from you more than once, forecasting growth and future performance of your business becomes unfathomable.

This follow-up covers some of the best ways to maximise customer satisfaction levels – and increase the likelihood that they’ll reorder.

Customer service... for the customer

How clearly can you remember businesses with amazing customer service? What about terrible customer service? Run-of-the-mill service? Odds on you’ll remember the amazing and terrible businesses, but will struggle over those offering so-so customer service.

You must focus on the customer first, and put your business second. It sounds simple, but in reality you’ll discover it’s a struggle – but worth fighting for. (However, be aware that suppliers of essential services, such as banking or utilities, are not required to do this as there are numerous barriers for switching to a competitor.)

Unite employee goals

To improve your customer’s experience as a browser, purchaser and/or when using after-sales support, every team member must work towards the same goals and give consistent messages.

If you make promises or claims that aren’t matched by you customer service, the odds are you’ll be waving goodbye to customers after their first purchase, especially if your product is readily available from other suppliers. Every employee must know the benefits your business offers and how far they can go with a customer.

Do “a Ronseal”

It’s hard to overestimate the value of a clear message, and wood stain and preservative manufacturer Ronseal nailed this with their famed slogan – “Does exactly what it says on the tin”.

If you make promises to your customers you must deliver. Whether it’s product quality, speed of service or simply after-sales support, customers expect clarity and honesty.

Things such as hidden terms and conditions don’t go hand-in-hand with happy, loyal customers, so look into every customer touch point and consider whether you’re misleading them.

Have a clear communication plan

Even happy customers may not return if they forget about you, so how do you deal with customers once they’ve finalised a purchase – what is your “post purchase plan”? Do you send a confirmation email once it’s despatched and that’s it or do you follow this up with a “we hope everything's okay” email? How about a special deal around the time you’d expect them to need the product/service again?

What about when they contacted your support team? Do you hope no reply means the issue has been resolved or do you follow up to check and give them a clear point of contact if not? Treat customers like they’re the most important thing to you – at any and every stage of their experience.

You may hear these referred to as “nagging plans”, that almost hassle customers into submission with repeated “come back to us” messages, but these are the bad ones. A well structured “care campaign” can maximise customer satisfaction and create amazing long-term loyalty.

If you don’t know... ask

Even with your best efforts you may not pick up on all the reasons why customers don’t come back to you. I’d suggest creating an element in your post-purchase plan where you can see the customers you have lost.

Getting in touch with these customers via unobtrusive means, such as a simple “goodbye” email or phone call, provides a nice human touch and can be used to find out why they left. Though you’ll probably have a low response rate, you’d be amazed at people’s honesty when you’re not trying to sell to them.

Noticing themes and trends in this feedback is crucial. Are they all linked to customer service or perhaps delivery times? If you see these growing after you introduce new measures or features in your business, it is a fantastic indicator of something being missed, and will have a noticeable effect on your bottom line if fixed early.

Some issues may just be incurable

Sometimes you just have to accept that some customers go elsewhere – no matter what. It’s inevitable you can’t win ‘em all and it can happen for reasons beyond your control, such as postal delays.

Ultimately, what I’m saying is common sense, yet it’s amazing how many businesses don’t apply it. Have you had any success stories about changing how you approach your customers or wish to add any points to this list?

Matt Bird of printer cartridge supplier, StinkyInk

Comments

Hi Matt

Another excellent post and you made very clear in your last article the financial cost of customer churn, with some excellent tips here on customer retention. 

The only point I'd add from my experience when I took over a unit with 10% annual customer attrition was that most things we tried for improving customer loyalty didn't work.  And the reason soon became clear - it was because we were thinking up things to do (consistency, quick response times etc) rather than fixing the things that were problematic from the customers' perspective.  And it was invariably different from customer to customer.

The one thing above all others that made a dramatic difference was when we started checking for satisfaction with a very short, simple survey, showed all the comments to everyone, then made absolutely  sure problems were fixed as they arose.  And the surprising thing was that we started getting far more positive feedback than we were expecting.  That not only boosted morale but also gave us review comments to attract new customers.

On that basis, while your suggestion for contacting lost customers is undoubtedly worthwhile, it can be even better to find out who's at risk before they go.

The results were so good that I left my job in customer services to set up CustomerSure.  There are many other survey tools available, but we're specifically focused on customer retention for small and medium businesses based on the methods I found that delivered such good results.

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