Introduction
It is not a secret that it is much harder and more
expensive to acquire new customers than it is to retain
existing ones. Retaining customers is not a passive thing
and many businesses fail to do it right and sometimes to do
it at all. To prevent decline of their business, companies
often increase their efforts and spending by expanding
existing customer acquisition strategies. Such increase is
often connected with increased cost for the additional
volume and also tends to become less and less effective the
more you do it, creating a vicious cycle that can lead to
the failure of the business when expenses reach a point
that profits get reduced to nothing and then turn into
losses that will take away from the businesses substance
and equity until it is too late to salvage what is left and
change course.
Spending time and money on retaining existing customers and
leverage the relationship that was build over time to
increase their spending with you instead of somebody else
is much more profitable.
Doing a good job with that also impacts indirectly your
customer acquisition efforts in a positive way, because
happy long term customers of yours are more likely to
recommend you to their friends and colleagues than
customers who have no relationship with you and only
moderate or not happy with you at all.
1. Customer Service
It is only possible to retain a customer who is a happy
customer or a customer how has no other choice (which is
one of the reasons why a monopoly is a bad thing for
everybody, but the company who has it). Forget about the
customers that are impossible to make happy. They are in
the minority and their number is insignificant. If you
think that it is in the double digit percentage range, have
a closer look at your marketing and advertising campaigns
and what sales is doing. Customer expectations that are too
high to meet are most likely the result of false promises
made during the conversion process.
While presenting ones product and company in a good light
is understandable and not a problem, are exaggerations of
key elements of your product or service that are critical
to your customers doing more harm than good. You might get
the initial sale, but you will probably lose the customer
as soon as they can away.
If you did all of this wrong, good customer service will
not help you very much to make a customer happy and retain
him.
Good customer service can do exactly that in cases where
something is not clear to the customer and requires
explanation or clarification. Nothing is 100% perfect all
the time and errors and misunderstandings happen. This is
usually not the end of the world and can be fixed easily
without letting it escalate. Good customer service is
critical in those cases to resolve the issue quickly and
without having the customer go through a complicated and
lengthy ordeal. Doing a good job here will turn an upset
customer into a loyal customer and even evangelist for your
company and your services.
2. Usability of the Site Make it easy for new customers to
find their way through the site and get them to convert. At
the same time keep in mind the existing customers who
already purchased from your site and know their way around.
Make it also easy for them to get what they want quickly.
2a. Customer Profiles
Allow users to create a profile to store address and
billing information. This sounds obvious in this day and
age, but there are still plenty of sites that do not
provide this capability. Allow customers to store multiple
shipping addresses with their profile. It is not unusual
that people use their home and work address depending on
the things they order. Also keep in mind that people buy
more and more gifts for friends, family and business
partners or customers (B2B) online, not just for Christmas,
but also other occasions, including birthdays.
2b. Expedited Checkout Process
A multi step checkout process that is simple and easy to
follow for a new customer is great, but can be annoying for
an existing customer where you have already everything
needed to complete an order on file. Even if you pre-fill
every page in the process, it does require several clicks
too much to get the customer to "place" an order. Show one
page with the existing and default data from previous
purchases or defaults the customer specified and have links
from there to pages to change individual parts like
shipping address, billing information, payment method, gift
options etc. Shipping method and coupons should be editable
right from that screen. This will allow the customer to
complete an order in a single step, if the defaults can be
used for the current order.
2c. Save for Later/Wish Lists/Gift and Wedding Registries
People don't always buy immediately something, even if they
are interested in the product. Make it easy for them to
save it and come back at a later time to complete the
purchase. Let people create wish lists and gift registries
like wedding registries if your products or services can be
sold as gift. You do not only get more business from the
customer, but also have the potential to acquire new
customers. Why is that? If you allow customers to create
those lists, also provide the means that the customer can
notify other people about this list to purchase items for
him from that list. Those people might be already a
customer of yours, but some of them might not.
3. Offers
If you only have promotions that are available to new
customers and never reward existing customers for their
loyalty, chances are that you will upset them or they start
to create multiple accounts in order to get rewards they
would not get otherwise.
Don't let that happen, because you either lose customers or
litter your customer database with numerous duplicate
profiles. This will also not help to build good customer
profiles and decrease customer loyalty. They will be off to
your competitor who does not require them to jump through
hoops and appreciates loyalty by providing incentives for
repeat and long term customers.
4. Communication
Stay in touch with your customers and communicate with them
on a frequent basis. It is not easy to determine the
optimum frequency for contact initiations that you contact
them often enough that they do not forget about you, but
not too much that they get annoyed by it and start ignoring
it or worse, consider it spam and filter it out by
automated means. This is a science by itself. Next to the
frequency is also the message itself very important. Not
every customer has the same needs or interest. The "one
message fits them all" approach is not only less effective
and converts poorly, but also increases opt-outs and
filtering out of those messages.
Making a message personal for every customer is not easy,
although it is the ultimate goal, but you can at least make
customers feel as if the message is personal for them. The
easiest thing to do is to address them with their name
rather than addressing them like "Hello Customer". To
provide messages that are as relevant as possible, is it
useful to segment your customer base. The segmentation can
be done based on a number of criteria and depend on what
you offer and the types of customers, their interests,
financial status etc. A single customer can be assigned to
multiple segments, which overlap and serve different
purposes.
There are numbers of methods you can use to contact your
customers. While a phone call or snail mail can be
appropriate and useful so is email still the most common
and cost effective way of communication between e-tailers
and customers. There are tons of services out there that
let you manage your email lists, segment your customers and
keep the list clean and up to date. The cost vary
significantly and depend on the number and type of features
you need, how much of the work the services will do for
you, if you can't or do not want do everything in-house and
from the size of your mailing list and frequency of
mailings (= email volume).
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Carsten Cumbrowski is an internet marketer, entrepreneur
and internet marketing strategy consultant with over 6
years experience in several areas of online marketing and
website development. He is a blogger at ReveNews.com and
SearchEngineJournal.com and operates a free resources
website for marketers at Cumbrowski.com.
http://www.cumbrowski.com/
http://www.cumbrowski.com/articles/
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