Keep What You Have, Grow What You've Got

The more you engage with customers the clearer things become and the easier it is to determine what you should be doing. - John Russell, President, Harley Davidson

Don’t underestimate the need to satisfy and retain customers. Most businesses put too much money, time, and effort into chasing new customers/prospects and far too little resources trying to keep their current ones. However, we all know that you can’t fill up a bucket if you don’t plug the current leaks. Real profits and stable revenue streams come from long-term relationships and repeat business with your current loyal, profitable customers. Some experts declare that 80% of a company’s future growth comes from existing clients, if served and cultivated properly. As such, customer satisfaction and retention should be your #1 marketing priority.

Again, the purpose of a business is to attract and retain customers. You can’t grow and remain in business without keeping the customers you currently have. First, you must measure your current attrition rate (loss of customers) and set a goal for dramatically reducing this rate. For example, let’s say, on average, that you lose 20% of your customers every year. A realistic goal would be to reduce this attrition rate to 10% per year. Bottom line, it is easier and nearly eight times cheaper to serve and retain current clients/customers than to pursue new ones.

Once you have plugged the holes in your attrition bucket, you want to serve better and get closer to these profitable and worthy customers. You want to better understand their needs and then fulfill as many of these needs as possible with additional products and services. Continually communicate with your customers. Give them value. Give them solutions. Focus on them and their needs, not on your products/services.

Communicate with them in person, in letters, in faxes, in emails, via your website, brief newsletters, etc. Don’t worry, you can’t over-communicate with your customers. Like employees, keep them informed, involved, and inspired to continue doing business with you. Also, repeatedly ask your customers the following questions:

• “How are we doing?”
• “What other needs do you have?” and
• “How could we improve our value to you?”

Your objective is to provide them with more value more frequently and as a result, you will benefit with more profits. Never sell a customer only once. Real profits come from repeat business. As such, set goals to increase the frequency and size of repeat business. You want ongoing relationships and ongoing sales.