Can You Keep Customers for Life?

Every day, business owners work hard to gain new customers through sales and marketing efforts. What many may be overlooking is the fact that it costs six times more to get a new customer than it does to keep an existing customer, says Bob Shaff, president of Customers for Life Consulting, a Tucson, Arizona customer loyalty consulting firm. Loyal customers recommend your products and services to others, cost less to serve, generally aren't as price-sensitive, and will forgive the occasional misstep because they have a relationship with you, he adds.

But the key to keeping those customers lies in putting some effort into capturing information about them and getting to know them. 'You definitely need some sort of mechanism in place to track your customers, and allow you to segment your customer base,' says marketing expert Greg Stielstra, author of Pyromarketing: The Four-Step Strategy to Ignite Customer Evangelists and Keep Them for Life. 'You need to know who these people are so that you can treat them uniquely.' He and Shaff offer these tips to create customers for life:

• Use the right tools. Depending on the size of your business, you may not need expensive tools. A simple spreadsheet with customer data, contact managers like those found in popular e-mail programs, or bookkeeping programs with customer data capture features may do the trick, says Shaff. However, as your business grows and you get a larger universe of customers, you should check to ensure that these tools are working well for your needs, he says. You want to ensure that you're capturing the right data and are able to access it in a way that's useful to you.
• Find the right incentive. Some customers like to know that if they spend a certain amount of money, they can get a discount on an upcoming order. Others are more price flexible, but like to know that their vendors' customer service is second to none. Knowing what is important to your customer base will mean the difference between keeping customers for life and watching them find other providers who will provide them with what they need, says Stielstra. What is the best way to find out the loyalty triggers among your customers? Ask them. Have employees incorporate a few simple questions into the check-out process, send out a short e-mail survey, or ask your customers yourself.
• Look for patterns. Review the data you get from customers and look for patterns. Are there seasonal buying patterns you never recognized before? Do customers who purchase one product or service typically also purchase another? These can be valuable clues for cross-promotional and marketing opportunities, says Stielstra.
• Keep in touch. Once you have a mechanism for capturing customer history and preferences, keep in touch, says Shaff. But do it in the way the customer prefers. 'Your customers aren't all the same. Some prefer mail. Some prefer e-mail. Some prefer another form of communication, like social media. Be sensitive to that and have a number of ways to communicate with your customers and interact with them the way they prefer,' he says.