Customers are the lifeblood of any business, and yet their patterns and habits remain ambiguous to many business owners. There may be several different types of customers that proprietors need to be concerned with, but the most important kind of customer, repeat customers, should receive the most attention. Repeat customers compose a solid foundation for healthy, consistent revenue.
But what makes a customer repeat their business at a given establishment? Discounts? Environment? Satisfaction? While several factors may play a role, one underlying theme drives customers back again and again: customer loyalty. Here are three reasons any savvy businessperson should consider customer loyalty above other customer considerations.
1. It costs more to make a customer than to keep one
Marketing can eat into budgets quickly. Generally it costs about five times more money to create a new customer from a given market than it does to keep an existing customer. Common sense would dictate, then, that making sure your current customers are pleased enough to come back is more important than searching out a new customer base. This isn’t to say, however, that finding new customers is not important; the takeaway here is to keep a healthy balance of resources between retrieving and retaining.
2. Loyalty engenders good customer reviews
People love to talk. First and foremost, they like to talk about bad things, which is not always healthy if your business has given them something bad to talk about. Make sure to give them good things to fill their conversations with, especially when it comes to talking about your company. Customers will talk to their friends and leave reviews on user-based content forums like those on Foursquare, Yelp and Fandango, among many others. Loyal customers will make you look good with more positive reviews than negative reviews.
3. Loyal customers will tell (and bring) their friends
Potential customers often ignore expensive advertisements because of the bombardment of ads these consumers feel every day. Recommendations from friends, though, are usually held in higher esteem. Loyalty can be contagious when customers are developed as partners instead of used up like expendable resources.
These points may seem like common sense, but they are not common practice. Even if you claim to be keyed in on what your customers want, are you actually doing that? Are you actually following through with the principles detailed here?
Follow your company standards from the top to the bottom to make sure that your customers are being given what they want and what they need on a fundamental level. Make sure that company policies affecting customer loyalty are ubiquitously adhered to. As always, be willing to make the necessary changes if they are not.
Author: Jeff Jacobsen is a freelance writer and editor who specializes in lead management software with an enthusiasm for sales techniques
Photos from www.flickr.com/photos/enriqueburgosgarcia and www.flickr.com/photos/65864039@N04
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