Every business owner needs customers to survive.
In a previous blog I talked about why your customers might buy. It’s great getting that initial sale from a new customer, but you want them to keep buying, long into the future.
This blog covers how to keep your customers happy so they will stay with you.
Founder of Wal-Mart Sam Walton understood good customer care. He said: “There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.”
Most business owners know that customer satisfaction is important. But they don’t really understand how important it is. How can it affect their business and profitability. Or they simply don’t have processes in place.
Look after your customers and they will buy more from you and recommend your company to others.
Research shows that market share, revenue, and gross margin are improved by having happier customers.
Many business owners may have customer service teams in place but forget to monitor results.
Here are some statistics that show the importance of good customer care:
- Up to 60% of customers will pay more for better customer service
- 89% would go to a competitor after a bad experience
- It costs six times more to attract a new customer than to keep an existing one
- It can take up to 12 good experiences to make up for a negative one
- One third of people experience rude customer service, at least once a month
- And 58% of these will tell their friends, family and colleagues, who’ll tell their friends, family and colleagues…
Remember that customers are fickle and will go elsewhere if you don’t look after them. So make sure you do an audit of the customer journey, gather compliments and complaints, put processes in place, and seek to learn and improve.
Social media has made good customer service even more vital. If you mess up an order, if you turn up late, or one of your workforce is rude, then chances are it will be posted immediately on Facebook, Twitter or LinkedIn.
Set agreed standards for your business, your supply chain and partners. Give your customers a good service.
When something goes wrong act quickly. Resolve the problem. Consider compensation or a good will gesture. Keep the customer informed. And if the complaint has come through Twitter for example, respond quickly and professionally, and ask the customer to take it ‘off line’ and either send a Direct Message or call you.
Most people understand that mistakes happen. It’s about how we respond that’s important. Ensure apologies are heartfelt and genuine, and that you act quickly to put things right. People just won’t accept anything else.
If you deal with the complaint effectively, you’re more likely to retain their business.
Here are some pointers to improving customer service:
- Keep your promises, so don’t say you’ll deliver in three days if you can’t
- Gather feedback, through an online form or a service such as Trustpilot, and monitor TripAdvisor or other social media
- Offer long-term customers a discount or alternative reward for their loyalty
According to research on customer spending, the biggest hurdle for getting loyalty schemes to work is getting consumers started.
Once on board, people are usually hooked. People love to feel special so having different tiers of loyalty schemes, such as bronze, silver and gold, also works.
Getting feedback from your customers will give you an invaluable insight. Here are some ideas:
- Try a short survey, either by phone or email, using for example MailChimp
- A more in-depth approach could involve focus groups
- Record the answers and pull together the findings
- Offering a prize, such as a £10 Marks & Spencer voucher, can incentive people to take the survey
- Ensure you tell customer you value their opinion and recommendations
So you have the responses, what do you do next?
- Listen to what customers have to say
- Be ready to change the way you do things to improve the customer experience
- Research what might need to change, including any costs
- Do a follow-up survey to check customers agree with the changes, including any required price increase!
It’s important that you use insight to interpret your research findings. You don’t want to make a couple of people happy, only to totally frustrate the rest!
According to the Harvard Business School, if you increase customer retention rates by 5%, profits can increase up to 25%.
Also consider the Pareto 80/20 rule. This states that 80% of your income probably comes form 20% of your customers. Make sure that this 20% of customers are delighted about you, your products and services and reward them for their loyalty.
To work out who are your best customers gather the following information:
- Postal address, phone number and email
- Birthday, to send out special discounts and cards
- Service history, dates and order information
- Total annual spend
Then analyse the data and sort the customers by the amount of spend. Try and identify any spending patterns, and talk to them about additional goods or services.
Just remember there’s only one ‘boss’ – the customer – and you won’t go wrong.
Please get in touch if you need any help in assessing your customer experience, collating data, and improving your service