“Keeping clients or customers
gives you a better bottom line” said Max the budding sales automation
specialist.

He continued, “The longer
you keep them the better. It costs less to sell to current customers because
the cost per sale is reduced and repeats are more frequent.”

 

That’s when I interrupted
asking, “How?

Max answered, “Raising
customer retention rates as little as 5% the average value of a customer
increases from 25% to 100%. Not as many new customers are needed to build your
business and you achieve real growth. All you need to do is maintain the loyalty
of your best customers.”

I had to disagree, “In other
words, you’re saying customers that are the most profitable now are the only
ones that this theory says are worthy of your best efforts.

What about the new customer
that has not established a ‘track record’ as yet?

How about the prospect that
represents a quantum leap?

What about the customer that
has been a major contributor to the bottom line in the past but is now
declining?

The price of loyalty…the
one-sided brand which these programs currently propose …is the loss of those
three customers.  It is a price most
businesses cannot afford.

Yes, you want to query your
contact management system for the most profitable customers. You do want to
know which parts of your service or product lines are most important to them.
You definitely want to define the value these high-yield customers seek from
you and let everyone in your organization know them.

But don’t set the metrics in
stone.

Relationships are dynamic,
not static.

Dynamic relationships demand
dynamic measurements. What is worth tracking?

Consider these:

§        
Referrals-– not
only the number but the worth on the basis of initial purchase and of ongoing
purchases.

§        
Tolerance—the
customers willingness to wait for your product or service even when a
competitor’s is immediately available.

§        
Buy-in—actual
investment in your company in terms of stock or alliances or standing by you in
a time of crisis.

§        
Trust—the key
element in any relationship. How much trust are they putting in your on-time
delivery and manufacturing capability? What is at stake for them with your
consulting services? Do they go out of their way to come to your store? What do
they put on the line inthis relationship?

Loyalty is only one part of
the dynamic relationship between you and your suspects, prospects and customers. Your ongoing task in this relationship
is to know your partner. That means understanding not only the business
requirements but also the personal differences between customers.

Your prospect and customer
contact management system should include ways to remember those things which
will allow you to personalize how you approach customers. Only by working with
their needs, desires, hopes and dreams can you build a protective barrier
between them and the competition.

You have to make each
customer believe they are special. The Loyalty program boosters believe that
this is done by spiffs and special awards. They believe that special cards and
clubs and point awards (customer retention programs) make people loyal.

Those activities do change
behavior…to a point. But you can’t buy loyalty.

Every single interaction you
and your staff have with that customer counts. A spiff can’t make up for
spending time waiting for your team to act. Payoffs don’t cancel out sloppy
service. Special cards or clubs won’t win him or her over if your product
doesn’t perform.

You want loyalty? Try being
loyal to them.

Rewards? Start by delivering
what you promise… consistently.  That’s
the reward they’re looking for.

Spiffs? Remember that it
offends some folks to be offered money to make a deal with you. They may
rethink why they wanted to make a deal in the first place.

Loyalty is constancy. It is
allegiance to the relationship. It is fidelity, staying true…for both you and
the customer. It is achieved through devotion and caring and knowing one
another.

Loyalty is gained, not
bought.

It is given away, not sold.

Give some away today.

I guarantee it will be
returned.”

Learn ore about marketing, product intros and nonstop referrals at www.JerryFletcher.com  Need a keynote speaker? Check out www.NetworkingNinja.com