Geri Stengel

 
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Keep 'em Coming Back: Repeat Customers Make Small Businesses Thrive

From 0% introductory credit cards to super low cable rates for 3 months, from 30% off your first purchase of diaper covers to free shipping on your first order, businesses spend money and pay attention to potential customers. That's what marketing is all about: new customers.

customer retention, customer service, marketing, small businessBut what happens to those customers once they sign on the dotted line, open the account or receive their first order? That's where customer service comes in and it is just as important to the bottom line as sales.

Call it retention marketing.

For small businesses, retention marketing may make up for an undersized advertising budget: It can give a lot of bang for the buck.

  • In the long run, giving a refund to a dissatisfied customer is likely to be cheaper than losing the customer.
  • Promotions that reward return visits – buy 10 cups of coffee and the next one is on us – make stopping at your store a habit instead of a one-time happenstance.
  • Listening, without anger, to a customer complaint may reveal a service you can provide or a legitimate flaw in your procedures. It will certainly make the customer feel respected and willing to give your business another try.
  • Be honest: If you don't have the product that will do what the customer wants, say so. That doesn't mean you can't suggest other approaches that will solve the customer's problem. It does mean you don't say the shoe fits when it doesn't.
  • Return phone calls or emails quickly, even if only with an acknowledgment. Don't leave customers on hold, literally or figuratively.
  • Train your staff to value each customer and treat them each with interest and respect. The corollary to this one is that staff should be evaluated on the service they give, not just the number of customers they serve.

None of these is as costly as an ad campaign but they all pay off when that second, third or 100th sale is made.They pay off when the well-served customer recommends you to a friend.

And therein lies the big payoff. Friends listen to friends. Strangers even listen. In this world of instant online reviews, people check out their social media connections and then read the reviews of others when choosing what to buy and where to shop.

That customer you refused to give a refund? He's likely to post your name in mud on Facebook.

Being nice to customers can cost you money, but so do electricity and water. Some costs just can't be eliminated.

Good customer service is good for the bottom line. New customers don't increase revenue if old ones are bailing. When that happens, you're just treading water. Getting better pays off more than getting bigger. Just ask Fresh Direct, which almost went out of business before it saw the customer-service light.

Zappos.com is known for stellar service and good prices. It's also known for growth. The two can go together.

Make your mantra: repeat business, repeat business, repeat business ...

Have you won or lost customers because of the service you gave them? Have you put customer service above cost when buying for yourself? Have you checked your online reviews?