Imagine having your own app. With your design, your own branding, customised features; everything exactly how you want it to suit your business. The perfect app for your perfect shop or restaurant. An app downloaded and raved about by every single of your customers. New customers finding you and running down your doors thanks to your app. Sounds like a dream, doesn’t it? Read more
Repeat business is great for any store – but it is easy to let focus on getting new customers take over. By focusing on your existing customers you can grow your business without spending your entire budget. So how do you make sure your customers come back to you? We’ve put together 9 of our best tips to improving your customer retention rate.
- Focus on what you know – and do that to the best of your abilities. Don’t feel like you have to have an enormous selection or variety. Keep your focus and do that to perfection before you consider branching out or broadening your offering.
- Don’t compromise on quality – don’t settle for anything less than you can proudly stand for and make sure you know your own products really well. Quality sells itself and gives you regular business.
- Don’t compromise on service – the way you treat customers means everything. A good customer experience will give you new business as well as repeat business.
- Train you staff – provide proper training to guarantee a uniformly good customer experience. Make sure there is a shared ethos and that you are available for any questions. Remember, your staff is a reflection of you and your business – investing in them is important.
- Provide value – exceed customer expectations. Many independents cannot afford to compete on price – but you can make up for it through service, attitude and follow-up. Aim to make each customer feel special. It needn’t take more than a genuine smile and a ‘how are you today?’. This is clichéd advice for a reason! Customers are often shy creatures – be friendly and approachable without being pushy.
- Listen to your customers needs. As much as is appropriate – ask to find out what the customer wants and for what purpose. If they have a specific request, great – fulfil this to the best of your abilities or offer alternatives if you can’t provide exactly what they are looking for. If they are unsure, be generous with suggestions and tips. Always be honest.
- Be generous. If you sell food items – offer samples of the daily special or if a customer looks indecisive. Get customers engaged in your product. If you sell a service – be generous with your knowledge and your time. Make sure you know your products well.
- Offer a loyalty program. It is another way of providing value and it gives the message that you appreciate your customers because you are giving something back. You can afford to be generous in this way – a loyalty card is popular with customers and the benefits great; people love to share their good experiences with their friends.
- Be engaging – it is important to get your customers to engage with you and your brand – but to make this happen it is equally important that you engage with them. By being empathetic you are more likely to provide the right service – you are more likely to give a good, lasting impression and you are more likely to serve each customer based on his her needs. Engage to be engaged with.
Do you have anything to add? Or any of these you find particularly useful? We’d love your feedback in the comments.
One simple, irrevocable fact of human psyche is that we love a bargain and a saving. This is why loyalty programs and discount systems are so popular – but not all are equally profitable for a business.
Loyalty card, schmoyalty card. What is loyalty? It seems there is a lot of confusion going around about what exactly loyalty means. Many people seem to think of it as huge discounts, scandalous offers and unbeatable deals. But that isn’t loyalty – it’s the opposite. It’s shopping around, without being loyal to anyone, basing the decision purely on price. Big brands can afford to compete on price, but for many independent shops this simply isn’t a viable way of doing business. Sure, you might get some customers in, but because they were attracted by an incredible offer chances are they won’t return unless they are offered something equally business-destroyingly great. Killing your business, and others, too.
Statistics show that only 8% of customers who come through a deal end up becoming regulars. That’s why loyalty should be your focus when it comes to attracting new business, not big discounts. They don’t work in the long run.
Loyalty, by definition, is the quality of being loyal. Supporting someone or something. And that is exactly what small independent businesses need. They need regular customers to keep business rolling. In every sector there are good times and bad times, quieter and busier periods. Loyal customers tend not to deviate as much. They are simply less sensitive to external factors, and therefore valuable to you.
How and why focusing on loyalty can increase revenue
By growing your loyal customer base, you can do a lot for your business. Stop chasing the bargain-hunters who are only there because of an extortionate good deal. Chances are they wouldn’t have visited otherwise. Those who walk in, stumble across it or go based on a friend’s recommendation, are more valuable, and are the ones to focus your energy on when it comes to encouraging their loyalty towards you. How to do it? Well let us share with you a secret…
Everyone loves free stuff. Everyone loves a bargain. That’s why people go crazy in the sales, thinking they save a load of money by spending money they might not otherwise have spent. This is the characteristic of human mindset you need to exploit.
Offer your customers something for free when they visit your shop. Now, not outright ‘here’s a free drink!’ – but ‘here’s a free drink next time, if you return. The classic stamp cards or points scheme fuel the primal want for free stuff, and customers? They love it, and they will come back to get their reward. More repeat business=higher revenue.
Why it works
A loyalty stamp card that gives its owner every 7th coffee free is extremely powerful. First of all it a saving, which is universally appealing regardless of its size. Secondly, it tells the customer that you value them enough to give them something for free for staying with you. And that’s flattering.
It might also be just the thing that keeps them from going elsewhere. If your quality of service and product exceeds other places, perfect. But there might be somewhere slightly more convenient – these are the ones to beat. With a loyalty program, you have an extra edge. You’re effectively telling the customer – we appreciate you and therefore we will reward you.
I often find myself returning to the same coffee shop simply because I get every 6th hot drink for free. This is only a fractional saving, but I still do it. The coffee isn’t the out-of-this-world good, but I know it and the staff are friendly, encouraging me to get my points.
Tick your customers’ boxes
For many customers, there are a few bases to cover in order to be their first choice. Convenience, price, quality and friendliness of staff. A loyalty program ticks two of these – it makes the staff appear friendly, and it has a minor positive effect on the price. I am a fan of loyalty apps these days – as it removes the chance of leaving it at home. I always have my phone on me, and love the flexibility these apps give compared to the traditional paper cards.
How your customers will repay you
We say GO loyalty! Push loyalty to your customers. Make your existing customers happy by offering them something in return. Those happy customers will tell their friends, who’ll come in, join your loyalty program, and tell their friends. It’s a simple and easy way of boosting word of mouth-marketing, without spending money on ads, flyers or anything else. We’ve all been there – told our friends or family how great that new place around the corner is. So keep your customers happy, and they’ll do your marketing for you.
It will save you money and time, and you’ll still grow your business because you focus your efforts on the customers you have – those you know will buy – instead of trying to convince someone who probably won’t.
Smart: Focusing on customer retention rather than customer acquisition.
The well known Pareto principle (e.g. the Gartner Group) states that 20% of your customers drives as much as 80% of total revenue.
Stupid: Chasing the bargain-hunters.
Customers who came to your shop through a fantastic deal are likely only to come back for a similarly business-destroyingly good offer.
Smart: Connecting with your customers.
The personal connection can be the deciding factor when he or she decides where to go next time.
Stupid: Not being online.
In this day and age, a digital platform is really important. Many customers will look up the shop before they decide whether to go or not. It doesn’t have to be complicated or elaborate – even a Facebook page would do.
Smart: Rewarding loyalty.
Give something back to your paying customers, and they are much more likely to come back. Everyone loves a saving, even if it’s minor.
Stupid: Trying too hard.
Don’t attempt to reach everyone at the same time. Focus on your neighbourhood, their neighbours and their friends. If your shop is good enough, it will spread naturally.
Smart: Keeping it simple.
It might be tempting to offer an ever-increasing range of product and services. However, as a small shop, you might be better off specialising in a few things. This creates a higher level of expertise amongst your staff, and less competition with other shops. Be the best at what you do, and stick to it!
Stupid: Not realising the value of loyal customers.
A 5% increase in returning customers can lead to a huge increase in revenue – as much as 75%, according to Bain & Co. Loyal customers tend to spend more, and may bring their friends!
Smart: Focusing on what you have.
If you only have 10 customers, make sure they are given the best possible experience. They will share, and they will come back – spending more than those who came through an offer.
Stupid: Underestimating the power of word of mouth.
You don’t need expensive marketing. A little goes a long way, and word of mouth is by far the most powerful tool.
Smart: Relax and enjoy what you are doing.
Enthusiasm and happiness are infectious, and these are vital ingredients in a successful business.