Philosophically, I don’t like leaving any low hanging fruit. Maximizing the lifetime value of your customers is capitalizing on the quintessential low hanging fruit. When the big brains of your organization gather in the conference room and the marketing plan is clicking by in a PowerPoint presentation with someone like me talking about market segmentation, targeting, customer acquisition costs and the such, you must never lose sight of the goldmine hiding in your existing customer base.
When it comes to your marketing budget and strategy, don’t focus all your attention on customer acquisition at the expense of customer appreciation and retention. This is a huge mistake. There’s big money in remarketing to your customer base. If properly nurtured, you’re far more likely to sell your product or service to a customer that you’ve already established a business history with than you are to sell to a new prospect. Not only that, but there’s no customer acquisition cost – they’re already your customer.
While there is little doubt that new customers are essential to growth, your existing customers should be an ongoing source of higher dollar transactions as well as referrals. Your customer care begins the moment they make their first purchase. If you don’t handle a new customer properly, you’re going to leave a lot of money on the table. A satisfied customer is far more likely to purchase again, and they are likely to spend more money than a new customer. They can also help drive down the cost of future customer acquisition efforts by referring other business to you.
So how should you handle a new customer? Well, to start you could simply thank them for the purchase and let them know you’ll be around tomorrow (and the next day) if they have any questions or issues. If you’re selling a service this reassurance works much the same way – after they’ve signed on the dotted line, make sure they know you’re just a phone call away. Your job is to reassure them – buyer’s remorse is often simply a symptom of neglect
Follow up again a few days after the purchase. Something like “Hi Bill, this is Brian with XYZ Widgets, I just wanted to check in and make sure everything’s great with your widget.” It’s simple, it’s fast, and it’s easy. If they DO happen to have a problem this is your real opportunity to shine. Address the problem quickly and graciously and make sure it’s happily resolved if at all humanly possible. People may forget a pleasant purchasing experience, but they’ll never forget amazing customer service.
Additional contact by telephone, mail, email, and text will make the customer feel valued and legitimize your business in their mind. If you ignore them after the purchase, you’ll be just like everyone else they deal with and you’ll leave no lasting impression. This is a missed opportunity. A well-appreciated customer that feels like you care is like an annuity, they can pay dividends for years to come.
It’s not enough just to follow up on the purchase, you need to make sure any issues or problems they have are addressed promptly, and constantly look for ways to improve. Mediocrity is not an alternative. The last thing you want is for your customer to see your business as a commodity, something that is identical to every other business in the same category. If you miss out on the opportunity to be excellent in the eyes of your customer you are unlikely to pick up much in the way of repeat business and you’ll lose all credibility for cross-selling. If your business is perceived as a commodity you’ll lose future business to lower-priced competition, something that rarely happens when you’ve properly cultivated the relationship.
Provide them with the reassurance that you’ll be there in the months to come. Offer them preferential treatment and pricing. Leave them with the impression that you’ll go the extra mile for them and you’ll cultivate loyalty, which in turn will provide you with reselling, cross-selling, and referral opportunities.
Establish rapport and trust. It costs much less to convert an existing customer than it does to acquire a new one. Don’t leave money on the table. Be smart about your marketing budget and pay attention to your customers. Many marginally successful businesses could be hugely profitable if they just followed this simple principle. If you’re not getting repeat business and referrals, you’re doing something wrong and you need to reevaluate your marketing strategy.
Final thought – don’t look at complaints as problems, look at them as opportunities. Your ability to quickly address problems and complaints speaks loudly to the quality of your customer service. Some of the best reviews of a business are from customers that had a problem that was handled in a friendly and expeditious manner. Listening to these problems also provides you with the opportunity to improve your product or service for future customers.