Small business owners devote a lot of effort to attracting clients, but once they have them, they don’t necessarily always focus on keeping them.
Losing customers can come at a significant cost for businesses. Finding new customers is also more expensive than getting current customers to make repeat purchases.
But how do you create a customer retention strategy that keeps your current customers engaged and happy?
A high customer retention rate means your customers trust your products and your company. That means they’re more likely to buy more from your company with each visit.
ENSURING QUALITY STANDARDS
My Business Entrepreneurship Facilitator Chris Mooney says the first step for businesses is to make sure they are setting a quality standard for the product or service that is being provided.
When businesses verify the quality of their products and services before they reach consumers, they can feel confident they meet the business’s high standards.
Protocols for managing quality help businesses deliver on these customer expectations. Customers are more likely to use businesses regularly that provide good standards of products and customer service.
“In other words, how should the service and product quality be assessed and how will I assess myself against that standard,” Mr Mooney said.
“The standard that you set should in many ways be set by the [customer’s] expectation of the value that would be delivered, so you should then be measured against that value.”
When it comes to creating a repeat cycle business, the best way to maintain and assess value for customers is to make sure that you’ve built communication channels with them, according to Mr Mooney.
“In other words, you’re not an order taker but you’re an order maker. The relationship that you have with your customer determines your chances of hitting the next order,” he said.
“It’s about a combination of quality and relationship is part of that quality.”
BUILDING RELATIONSHIPS
To better retain customers, utilising and building relationships across the business then becomes crucial, Mr Mooney explains.
Relationship building is all about creating and maintaining engagement with clients over time through strategies that increase their chances of returning to your business in the future.
Fostering these relationships takes a different approach compared to that used for getting new leads, but if implemented correctly, relationship marketing strategies can unlock a number of benefits for businesses.
This approach to relationship marketing can often be difficult to implement, so it will be important to consider the typical customer issues your business faces.
“It is all about relationships. Think about it this way, customers will forgive a supplier if they have that relationship,” says Mr Mooney.
“Everybody makes mistakes, all quality and services are variable. The question is ‘can I get most of it right than wrong and if I make a mistake why will the customer forgive me?’
“Businesses who put an emphasis on customer value – the satisfaction the customer expects to experience when taking a given action in relation to the cost of that action – have a far greater chance of standing out in the market and developing long-lasting, mutually beneficial relationships with their customers.”
