Author: JoAnna Brandi
Investing in customer relationships is insuring your bottom line. If you can save just 5% of the customers you currently lose, you can yield from 25% to 100% increase on your bottom line. No one can afford to ignore the evidence that exists regarding customer loyalty. Stated another way: You can double your net profit by keeping 5% more of your customers!
Running a business in these times is at best a challenge. But isn't there anything a business owner can do the assure that business will remain on a steady course?
If there's one thing that can act as an insurance policy for your business it's what I call "Exquisite Customer Care"...no, not good service, not just delighted customers, but a philosophy and practice in your business of building, enhancing and nurturing long term profitable relationships.
Investing in customer relationships is insuring your bottom line. If you can save just 5% of the customers you currently lose, you can yield from 25% to 100% increase on your bottom line! While this depends of course on your fixed costs, no one can afford to ignore the evidence that exists regarding customer loyalty. Stated another way: you can double your net profit by keeping 5% more of your customers.
So, let's stop focusing on how to "close the sale" and let's start focusing on "opening the relationship." The basic premise of "Exquisite Customer Care" is that care is different than service. Service, in the minds of so many people is both reactive and, some feel, beneath them. Which is why they don't do a good job of delivering it.
I say change the model. What if we encouraged people to think of care as creating a relationship -- proactively, energetically and enthusiastically? I see faces brighten up in the audience when I deliver this alternative to the tired and reactive service model. People get excited about building relationships, and contributing their energy to the well being of the company in a way they understand.
Relationships are built on trust, respect, communication and appreciation. After all, isn't the act of a customer handing over money to us an act of trust? The customer trusts that what they are purchasing is the quality they expected, delivered in a convenient and courteous fashion at a fair price. It's called value. The customer trusts we'll give value in exchange for their money. Do we respect them enough to give that to them, say thank you, and ask for feedback (that we then use to improve the process?).
Investing in the customer relationship makes sense. It brings a higher customer lifetime value. When we build strong relationships with customers they pay us back with loyalty for a long time to come. They keep buying from us (providing we are listening to them and still meeting their needs), they refer us to their friends (especially when we ask) and this keeps our advertising costs down.
If a customer buys from you once every month and spends $200, that customer's single year worth is $2,400, if you can keep that customer happy and loyal, in ten years they become a $24,000 customer. And that's with no increase in business or referrals. What if that same customer referred 2 people a year that became customers, and each of them referred two? You figure it out. Relationship Marketing pays off big.
Why not rethink the way you are spending your marketing and training budgets and invest some of that money in building better relationships with the customers you already have? There's no better assurance then a loyal customer base. So recession-proof your company with caring and concern for the quality of your relationships.
Copyright 1998-2013 by JoAnna Brandi. Used with permission.