Building customer loyalty is essential for success in business. Acquiring new customers is essential, but if that’s all we ever focussed on, it’d be tough on your sales team as well as your marketing budget.
Acquisition vs Retention?
Econsultancy did a customer loyalty study which showed businesses are only 5-25% likely to sell to a brand new customer, but are 65% likely to sell to an existing customer. So it follows that we need to look after the customers we acquire extremely well. In fact, we need to make sure they fall in love with our products, service, systems and processes. We need to be easy to do business with. Ideally, we need to literally make our customers’ hearts sing.
44% of companies have a greater focus on acquisition, than on retention.
Customer Lifetime Value – a measure of customer loyalty.
76% of companies see CLV (Customer Lifetime Value) as an important part of their sales strategy, but only 42% of companies can actually measure CLV accurately. When I work with clients on their sales strategy, I refer to the ‘sales staircase’. The easiest way to think about the staircase, is that the first product purchased is the entry point to your business (aka the bottom stair). Subsequent sales then draw the customer deeper into your business and product range, and consequently increase the customers’ value and longevity. The more you sell to them and the longer you maintain their loyalty, the further up the staircase they go.
So, what are the top tips for building customer loyalty?
- Make sure your business offers a first-class customer experience. Be transparent. Impress your customer with the unexpected – send a thank you card, know their birthday, offer loyalty discounts.
- Use consultative selling rather than pushy closing techniques. Build broad and deep relationships, especially if you’re in a service business.
- Assume your customer has done LOTS of online research. Treat them as product experts unless they tell you that they aren’t.
- Ask your customers for feedback. If something hasn’t gone well and you face a complaint, deal with it positively and quickly.
- Make sure your website is clear, speedy and up to date. Not too many pop-ups, check for broken links and keep content refreshed.
- Embrace online reviews. You can’t control what people think or what they say. Just respond professionally and without delay in the event that you receive a poor rating.
- Data is king. Build an accurate database of your customers’ details. The minimum needed is first name, last name and email address. The more you collect, the richer your marketing can be (just remember that too many questions may be a barrier to sale).
- Build a highly effective email marketing strategy. Use welcome emails to introduce customers to your team. Send a Newsletter. Send regular discounts and offers.
- Analyse your email campaign open rates to learn which subject headers work best, and act appropriately on subscriptions and consent to use their data.
- Remember the human touch still has a place – doing customer care phone calls, simply to say ‘hi’ and check that all is well, impresses customers. Find the time to call your best customers – they’ll really appreciate it.
56% of companies use email marketing as an effective way to keep in touch with their customers and upwell to new products and services.
Find our more about Momentum South West: www.momentumsouthwest.co.uk
By Rachael Howourth