10 Inexpensive Ways to Keep Your Existing Customers

A lot of time, effort and money are spent on attracting new customers to any business. It is 6 to 10 times more expensive to “buy” a new customer than to keep an existing customer. Here are 10 inexpensive ideas to ensure your existing customers stay your customers.

Deliver Great (Personal) Customer Service

First and foremost, deliver good consistent customer service. This should be the baseline for any retailer. This is major competitive advantage for a small retailer. You can deliver a level of personal service the envy of large retailers!

What is good about this is it doesn’t cost you a cent. It is all in the way you treat and interact with your customers. Here are some basics to think about

Smile, be pleasant and genuine.
Please your customer, know your customer.
Listen, don’t argue and admit mistakes.
Deliver on your promises, don’t overpromise and honour your commitments.
Build relationships and be available.
Instill a customer service culture throughout your business.

Think about your own retail experience as a customer and treat people as you would want to be treated.

Database Marketing

Keep in touch with your customers by using the potential of your customer database through direct marketing. Database marketing is an effective way of keeping in touch with your existing customers, increasing your sales or even increasing the frequency in which your customers purchase from you.

You don’t need to be a big retailer to send an offer or communication to your customers. A simple mail merge with your list of customer’s names and addresses can kick start you into the world of direct marketing. You can send hundreds of letters enclosing newsletters, brochures, special offers, announcing new products or services and so on.

Depending upon what is suitable for your business (and your customers) you could forward messages by letter, phone, email or text. To do this however, you must have a good database. That is you need to keep true to collecting names, addresses, phone numbers and/or email addresses. Your direct marketing is only as good as your database integrity.

Advantages of database marketing are that is relatively easy, inexpensive and measurable. Using coupons, codes or order forms you can measure direct response allowing you to fine tune future offers.

Beware of over communicating and becoming a nuisance. Understand your customers and your limitations under the Spamming and the Privacy Acts.

Gold Customers

No doubt a large proportion of your business comes from a small number of customers. This is the Pareto Principal or the 80/20 Rule. Understand how this applies to your business and identify those customers contributing more than most. Most businesses will have their “gold” customers.

Gold customers are those customers who spend more money, more frequently than others. Call them what you want but these people are gold and you need to look after them. So treat them special and do not be afraid to invest in them over and above others.

Ensure you have specific “Gold” customer strategies in your marketing plans. Ensure you understand what they want, the way they want it and make them feel special. Get it right and they will reward you with continued frequent business, no matter what type of business you run.

Social Media

Social media strategies not only work promoting your business but are also handy ways of communicating with and rewarding your existing customers.

Consider joining social networking websites (Twitter, Facebook etc.), writing or commenting on relevant blog posts, and participating in online groups, clubs, or forums. By providing relevant comment or information you may establish a network or following. The ability to have or build followers through social media allows those followers to see your tweets and posts.

Once established, you have a welcomed method of communicating directly with your customers. It is welcome because they have signed on to follow you. If they don’t like what you say, or they see no value in following you, they won’t. So be sure to communicate regularly with relevant information and offers. Treat your followers as you would face to face customers. See retailing online for more detail.

Loyalty Schemes

Loyalty schemes aim to offer your existing customers incentives to:

stay your customer
purchasing more frequently, and
spend more money when purchasing.

And by doing this keep them happy and focused on your business

Loyalty schemes can take many forms but successful schemes seem to have one thing in common that is they actual reward their customer and the customer perceives a win/win scenario or value in the scheme.

You don’t have to be the size of a Myer One scheme or an Airline Frequent Flyer program to be successful. Programs that make customers feel privileged, special and recognized are the most successful. For instance:

Simple loyalty schemes like coffee cards that offer something free after so many purchases can work with most businesses.
Things like thank you texts, birthday/anniversary giveaways etc. recognizes that their custom means something to you. Recognition is a reward in itself and if done well can be a small business competitive advantage.
Special preview events targeted at gold customers allowing 1^st purchase of sales or new products, can also work in most sectors.

Once again it is important to know your customers so you can deliver a loyalty programme that offers something they will perceive as valuable.

Email Newsletter

Another great way of communicating with your existing customers is through a regular email newsletter. Email newsletter can be put together easily and creatively and are relatively inexpensive compared to printed matter. Any business, no matter the number of customers can set up a newsletter.

The key to success is not to confuse a newsletter with a direct selling message. So here are a few tips for a successful newsletter:

The newsletter should be more information based, so keep the selling low key.
You will only have a few seconds to grab your customer’s attention before they delete, so make it creative and relevant.
Attention span is also limited so keep it brief.
Offer something of value to your customer. This can be as simple as a tip for using the product, a relevant article, and discussion on a new product and/or an offer.

Always ensure your customer welcomes the communication and have an opt out link. Ensure you follow the relevant SPAM and Privacy Acts of your state.

Referrals

Don’t wait for your positive word of mouth to just happen, proactively sponsor it. This can be done in a number of ways. The first is to simply ask for it -“If you were happy with your service today please tell a friend”. You would be surprised at how many would do this on request.

Another would be to hand out a business card and ask the customer to give it to someone who is interested in the type of product you sell. Write the name of the customer on the back so when their friend comes in, you can thank them.

You could even formalize this into a promotion “recommend a friend” where you reward the person who recommends a new customer to your business. This is generally done through an offer to the existing customer as well as an offer to the new customer. Print specific material to support the offer and promote it.

Local Networking, Sponsorship & Community

As with gaining new customers these forms of promotions and involvements create awareness of you, your business or brand. Get out and about in the community and build yourself a network of people who know you, what you do and are ready to recommend you or your services.

Join local clubs, associations, sponsor a charity or event, anything where you can interact and meet different people. Target organisations that may directly help your business, for example, a sports store might associate with local sporting clubs. However, in the end it is the people you want to reach so don’t forget the charitable side of things, Clubs such as Lions, Rotary or equivalents.

Events

One of the great ways to make your customers feel special is hold an event where you invite your customers for a special treat. No matter what type of business you are in you must be able to organize something by yourself or with other complimentary businesses.

An event can be anything related or associated with your business. Anything from product launches, tastings, BBQs, sporting events, charity and new store openings. New or seasonal products are always a reason to celebrate. The events can be big or small, one store or many.

Join together with your neighboring stores and create an event to bring traffic to your precinct or take your goods elsewhere to reach new customers. Most of all know your customers, what will work and invest the time and effort.

A good event is quite often like a good idea – you may need 10 of them to get one to work. Keep trying new things, repeat the ones that work but never give up.

Loyalty Schemes

Retain and expand the sales of the top 20% of your customers who give you 80% of your business by developing loyalty schemes to show you really appreciate them. Some ideas:

Offer discounts or rewards for purchases over a certain amount. For example, coffee shops and music shops provide loyalty cards that are stamped after each purchase, the reward being a free coffee or CD after a set number of purchases.
Give them special recognition through thank-you letters, or birthday and anniversary cards.
Invite them to special preview evenings of new products or services.
Let them have first choice at sales.
Hold a contest or competition with entry open to privileged customers only. Consult your solicitor to make sure you comply with applicable laws relating to such competitions.
Reward them for referring new customers.
Tactics that make customers feel privileged, special and recognized are the most successful.

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To your success,

Paul Duncan

PS: ARE YOU READY TO “DOMINATE YOUR MARKET”?…: