Make more and better efforts to coddle your existing customers and
you can turn them into perpetual gold mines of additional business and
revenue. And the more you satisfy them, the more likely they are to
spread positive word-of-mouth – which in turn will constitute the
single biggest way for you to win new customers. Part one of this
article hit on the ways you can get to know and understand your
existing customers; part two deals with methods and tactics for
deriving more of your business from that loyal base of buyers.
Demonstrate that you know your stuff
Find ways to make your customers believe that you understand your industry, as well as their role in it, better than anybody.
One
way to do this is to blog. “It’s not practical for a startup sometimes,
but it’s necessary,” says Jeffrey Eisenberg, an expert on online
customer relationships and co-author of Waiting for Your Cat to Bark? Persuading Customers When They Ignore Marketing. “Most of the things that really create customer intimacy aren’t practical.”
Beth
Shaw started a quarterly magazine that goes out, free, to all 45,000
customers of YogaFit Inc., the yoga training and equipment company she
founded in Redondo Beach, Calif. It includes editorial material not
only about her company and yoga, but also about health, diet, finance
and other lifestyle concerns. YogaFit also includes coupons for its
merchandise.
“Our database is our biggest source of
referrals, and we wanted to give them something useful,” Shaw says.
“It’s a way to make them feel they’re part of our network and to keep
them coming back.”
Touch your existing customer’s hot buttons
It’s
almost a cliché, but your customers likely will want you to provide
solutions to their problems instead of just a menu of products and
services. The closer you get to their managerial and executive
decision-making levels — rather than just purchasers at the low,
technical levels — the more they’ll want this extra help.
“Show
them how your products actually can accelerate their sales results, or
how it’s going to help them reach other financial goals faster, or how
it will help their cost-reduction efforts,” says Lou Schachter, the
Scottsdale, Ariz.-based author of The Mind of the Customer. “Having
a broad understanding of their needs is what allows you to cross-sell
and up-sell. It leads to a much broader discussion about the ways you
can help them, and that’s what they want.”
For some
customers, the chance to review your products – publicly – is what gets
their juices going. So in its e-mail follow-up to a sale, Allsop Inc.,
for one, invites buyers of its computer accessories to post their
thoughts about Allsop products on a site called PowerReviews.com.
“It
gives us street cred with our customers that we’re being real and
genuine about our products,” says Jeff Lechtanski, marketing director
for the Bellingham, Wash.-based outfit.
Look for ways to cross-sell and up-sell
Ask
your customers what else you can do for them. Package your products and
services together in profit-enhancing ways, and customers will be more
likely to broaden their dealings with you. Use cross-selling as a way
to seal a deal.
If you run a carpet-cleaning service,
offer to clean drapes as well. When shipping a product to a customer,
include inserts highlighting other items in which they’d be interested;
even if only a small fraction of your customers starts taking you up on
extra services or similar products, you’ve boosted revenues and margins
with minimal effort.
Offer attractive incentives
Besides
knowing your customer well, extra incentives are the best way to
cross-sell and up-sell them. Every incremental transaction adds to your
margins as you spread your costs over another sale, and the customer in
front of you is the best candidate to take the bait.
This
can be as simple as offering a second slice of pizza for 75 cents
instead of $1. Or you can make your frequent-customer program more
formal. Shaw, for instance, has a Club YogaFit that offers a 20 percent
discount on all merchandise and re-training, all for the initial $149
membership fee, saving the typical customer hundreds of dollars.
The
more important it is to keep and expand your relationships with
existing customers, the more you should be willing to offer. For
example, when Papa Joe’s closed one of its two suburban-Detroit gourmet
supermarkets for a year to build a new store nearby, it offered the
shuttered store’s customers a whopping 20 percent discount to continue
shopping at Papa Joe’s other shop 15 miles away, just to keep them
happy until the new store was completed.
Our Bottom Line
With
the high cost of acquiring new customers, it just makes sense to do
everything you can to build additional business with existing ones.
Once you get to know those customers better, you’re equipped to tap
into those relationships more effectively. Then you can use such
techniques as cross-selling and up-selling to turn loyal customers into
loving ones.
