I was talking to a business owner at a recent chamber of commerce meeting who told me, “We’ve grown our business because our customers are so loyal.”
Clang! Ding Dong! KaBoom! I started hearing alarm bells going off.
According to my dictionary, a “loyal” party is “one unswerving in allegiance.” I honestly don’t think such a “loyal” customer exists, and even if they do, they are pretty rare.
I strongly feel that the loyalty is, or should be, the other way around. It is up to the business to be loyal to their customers, and if you are truly loyal to your customers, you will force them to be loyal to you. In other words, the business, if it wants to retain customers, must develop the relationship and somehow bond those customers to the business with more than just doing whatever the customer paid them to do.
A primary goal of most businesses is to create “loyal customers” (my definition: Customers who use you whenever they are in the market for your services and don’t consider using someone else). You do that by developing long-term relationships with clients and referral agents. There are six steps to this process:
1. Receive an inquiry from a prospect.
2. Convert the inquirer from prospect to first-time customer.
3. Utilize a series of marketing events to get that customer to return.
4. The first-time customer returns.
5. Create continuous reinforcement marketing.
6. The returning customer comes back on a regular basis, thus becoming a “loyal customer.”
Step one: The inquiry
Let’s call this an “inquiry” because, more often than not, you have to answer their questions before they actually buy your services.
They call you for any number of reasons — maybe they saw your truck and thought it looked good, maybe they found you on the web or in the Yellow Pages (yes, some people still use the Yellow Pages), maybe you sponsor a youth athletics team the prospect’s child plays on. However they came to you, they called you, and now it is up to you to convert them from a prospect to a first-time customer.
Are first-time customers loyal? No! They are just trying you out.
Assuming they are happy with the work you did — the value, your level of courtesy, etc. — they might come back to you when they are next in the market for your services… or they might forget you altogether unless you do something more than just staring at the phone, waiting for them to call.
Step two: Customer conversion
If you answer an “inquiry call” well, by answering the prospect’s questions, and give them the confidence that they will be satisfied with your work quality, convenience and price you will convert that person from prospect to first-time customer. So you do the work, get paid and chalk that one up in the “loyal customer” list, right?
Wrong! Some of those first-time buyers will come back for more of your services if they are satisfied and remain in the marketplace, but only if they remember you.
Step three: Bringing them back
Before they become a loyal customer they have to buy from you again… and again and again.
First they become a “returning customer,” then a “frequent customer” and then a “loyal customer.” That only happens if your business continues to deliver on its quality, service and value proposition. Then a relationship with the client is made and solidified.
If you start marketing to those first-time customers immediately after the first sale and continue marketing to them on a regular basis, there is a much higher probability they will remember you the next time they are in need of your services. A few possible marketing actions you could take are:
- Thank you cards
- Quality surveys
- Quality control calls
- Offers for next service(s)
- Reminder call, mailing and/ or email
- Continuous marketing events (newsletters/ “tips”/ offers) on a regular and/ or seasonal basis.
Step four: Customer’s return
Treat them special. Reward customers for returning by giving them something, perhaps a discount on either this service or, preferably, the next. Your goal should be to force them to never consider using one of your competitors and build that relationship.
Step five: Continuous reinforcement
Continue with the newsletters/ tips/ offers either on a regular (monthly/ quarterly/ etc.) or seasonal (holidays/ spring cleaning/ pre- or post-holiday) schedule or (better!) integrate the seasonal marketing into a regular marketing calendar.
Step six: The loyal customer
Congratulations! This is what you’ve been working so hard to have, a growing group of loyal customers! But there is a problem.
After a while, the relationship becomes really comfortable like a favorite old shoe. Ahhh. It fits. It’s comfortable. I love it.
And that is the point where you can start getting in trouble because the business starts treating the long-term client, not like a “loyal” customer, but like an old shoe — someone so comfortable with the relationship they will never swerve away, never be seduced by the competition.
But what often happens is people in the business stop paying attention to them because they feel “their allegiance is unswerving.” No, it’s not! Old shoes that are polished and maintained regularly look good for years and years; those that are allowed to break down are replaced often. It’s the same with customers.
To my way of thinking, a business should never think of a client as a “loyal” customer. Businesses should always treat customers as honored guests, always nurture the relationship, and always insure they are getting the best quality and courteous, helpful, friendly, expert service.
Realize that clients aren’t loyal. Be always aware that if they can get better service or quality or value somewhere else, they will leave forever when your business starts giving them anything less than your best. In other words, they swerve and can do so over the smallest slight, a momentary lapse in courtesy or a feeling that they are being taken for granted.
It is the business, and everyone in it needs to become loyal and develop unswerving allegiance to the client. If the business is loyal to the customer, it strengthens the bond and builds the relationship, and when that happens, the client becomes really comfortable with you, like an old comfortable shoe that they take care of well by buying from you again and again.
What do I mean by being loyal to the customer? I mean that you should go out of your way to reward them with personal service.
What do I mean by rewarding them? I mean that you create different marketing initiatives to delight them. Here is a brief list of possible rewards:
- Customer appreciation event: Have a wine and cheese party to celebrate the start of the pre-holiday or spring cleaning season.
- Create a “special customer” club (open only to people who are frequent customers). Make them feel special because they truly are (or should be special) to you. Go through your database of loyal customers and see what they purchase from you. Then offer them some truly special offers for services they don’t normally purchase from you. Yes, this means you do this promotion on a one-by-one basis, but we’re not talking about sending out thousands of offers. It will be worth the effort in retained customers.
- Hold a “demo day” with an interior decorator, and invite these special people to watch you remove spots and demonstrate how you work with some exotic fabrics. Realize that, if you impress the decorator with your skills, they will become an outstanding referral agent also!
There are countless other ways you can show loyalty to your customers, and, like a well maintained, polished pair of shoes, you and your customers will be constantly loyal to each other, constantly comfortable. So take a look at your customer retention system, polish it up and force your customers to be loyal.
Larry Galler works with business owners to create marketing and management breakthroughs. To get his FREE e-book “Strategies to Create Lifetime Customers,” send an email to [email protected], and put “Lifetime” in the subject line. Include your name and business name.