Lesson number five of our Five Simple Strategies to ensure we never have customer service issues, is to always maintain the goal of Customers for Life. Why customers for life? Well, as we learned in the first post in this series, it costs six to seven times more to acquire a new customer than to retain an existing one. In other words, the experience cannot end once they’ve paid you, because it costs you so much more to acquire their replacements.
Obviously, there’s a lot that goes into creating a customer for life, so let’s keep this simple and just focus on the three most important times in the customer journey where you can have an impact. That is, before, during and after the sale.
Yes, I know what I just wrote is along the same lines as a doctor telling you that the only thing you should put in your ear is your elbow, but that’s because you should always be focused on creating a customer for life. Gone are the days where you could profitably rip out someone’s heart or tear off their head in the transaction and expect little long-term impact.
Today’s customer is sensitive to online reviews and (again) as we learned in the first post in this series, just one negative online review can translate into a loss of 22% of potential new business. Couple that with the higher costs associated with generating a new customer versus keeping an existing one, and there is plenty of financial incentive to always focus on keeping every customer for life.
Before the Sale
The best customer service before the sale example I can think of involves an actual encounter I had with a local tire store in 2015.
I had a slow leak in one of my tires and they happened to be the closest repair shop to my home. So, I dropped in there to have them plug the leak, and although I’d never spent a dime with them before that visit, they repaired my tire at no charge. (If you’re interested to read the entire encounter, please read What I Sincerely Hope My Local Car Dealer Can Learn From Tire-Rama.)
Prior to that visit, I’d spent nothing with this tire store. In the subsequent 24 months, I spent more than $4,000. Their one tiny gesture before ever selling me a thing resulted in creating a customer for life. They now get first crack at all of my family’s repair needs.
During the Sale
The first four lessons of the 5 Simple Strategies (Volunteers and Orphans, Expect the Unexpected, Convenience Store, and Real Alignment) are precisely the strategies you want to employ during the sale to create customers for life.
After the Sale
There are plenty of industries like autos, RVs, furniture, appliances and even Real Estate where there are built-in after sale functions like delivery, manufacturer surveys or service. How you treat customers after they’ve spent their money with you is more telling than how you treated them before.
Do you return customer calls promptly, even when you know it concerns a sticky problem?
Are you quick to find solutions for customer issues, even when it’s “not your job?”
Do you allow your customers to return merchandise, no questions asked, like Zappos?
Do you maintain a valuable customer loyalty program?
For the most part, customers want to be loyal and they want you to recognize them for this loyalty. For nearly all retailers, this means maintaining a valuable (for the customer) loyalty program.
The good news on loyalty programs is that they are being adopted by millennials as readily as they were with previous generations. Though it’s critical – if you want your loyalty program to indeed drive loyalty – that your program be simple, transparent and worthwhile.
To discover if your loyalty program meets these criteria – and if it helps create customers for life – gather your frontline employees and ask them to explain the following:
Describe the company benefits of our loyalty program.
Describe the customer benefits of our loyalty program.
Describe how easy it is for our customers to redeem the rewards they earn through the program.
Tell me how valuable these rewards are to the average customer.
You’ll know immediately if your loyalty program is working as intended. If it’s not – that is, if it’s a lot of smoke and mirrors – it’s losing you customers; not creating customers for life. If it’s harming your ability to create customers for life, then consider completely abandoning it or, at least, drastically revamping it.
Your goal, of course, is not to have a loyalty program, but to create loyal customers for life.
Next up in the series: But They’re Just After Dinner Mints!
(If you’re catching this series for the first time, you may want to begin with the first post in the series: Why Does Good Customer Service Matter?)
Steve Stauning, creator of The Appointment Culture and an expert in The Customer Experience, is the host of Undeniable Advantage Live!, a monthly live video webcast and customer service training provider hosted at UndeniableAdvantage.com. He is also an extremely popular keynote speaker, writer, and industry consultant. Learn more about Steve at SteveStauning.com.