The Heart of Repeat Business – Part 3 of 3

By CorexpandCX on September 27, 2013

Landing enough customers to always be profitable, and keeping them for life…

That’s the dream of every committed business person.  And a BIG part of making that happen is how you make your customers feel.

In part 1 of this article, we talked about the importance of engaging with your customers to let them know that they mean more to you than just a sale.

In part 2 of this article, we looked at one way a local business made a human connection which accomplished just that. And we talked about the three pillars of great customer relationships to help you cultivate and nurture lifetime repeat buyers:

  1. Engage with your customers in a way that lets them know you appreciate them, not just their money
  2. Do things that help them keep you in mind
  3. Do things that make your customers enjoy doing business with you and make them feel appreciated and special

Now, let’s take a look at some core strategies for making sure your customers – old and new – stay supported by those three pillars:

Reach out

Be honest with yourself; when was the last time you picked up the phone just to connect and check on one of your key customers?  For some business owners/managers, the answer may be never.  The problem is, the more distance there is between you and your customers, meaning the less engaged you are, the easier it is for them to jump ship to one of your competitors.

A simple phone call to a customer, especially a key account, can work wonders towards reassuring them that they’re doing business with someone who cares. For example:
“Hey Jim, I just wanted to see how everything is these days.”, or
“How’s the new expansion into the Southern states going?”, or
“I just wanted to see if there was anything I could do for you.”

Those simple efforts at reaching out and connecting can speak volumes about your commitment to your customers’ satisfaction, and the fact that you care about them more than this week’s invoice.

If you do take that very important step, do what most people forget to do; shut up and listen. That means really listen.  A lot of people, especially in the business world, engage their brains more in preparing their response than they do in hearing what the other person is saying.

By combining good listening skills with a little empathy (giving them acknowledging feedback to let them know you’re hearing what they’re saying) you can uncover a lot of valuable things.

You can uncover pain points that you might actually be able to help with. Even if it’s a problem outside of the realm of your products and services, you might know someone or something that can help them solve a challenge or overcome an obstacle. But, it could also involve some product or service that you offer that they didn’t even know about. Yet, none of those deeper needs can be uncovered unless you engage, and listen.

 

Regularly communicate
While it’s a great start, just picking up the phone and occasionally calling isn’t enough these days. You have to keep them engaged. If you’re smart, like most businesses these days you’ve implemented content (inbound) marketing into your business growth strategies (if not, don’t worry, we’ll cover that in future posts).

And while content based marketing is great for bringing in new leads, prospects, and customers, it’s also part of a good customer retention strategy. The key, of course, is to let them know what’s happening. Send them an email about your new report, blog post, or whatever. Just be careful that your emails and regular communications aren’t always asking for a sale. There’s a delicate blend of value versus promotion that you have to strike in order to not turn off your customers.

Make a personal connection
As we said earlier, customers are much more likely to buy from, and stick with, people they like. And there’s no better way to help someone like you than to let them know you appreciate them, and know what’s important to them.

And you’d be surprised, but little things mean a lot (remember that birthday card I mentioned in the last part of this article?). When you bring a new customer into the fold, take time to learn as much as you can about them – their children, their hobbies and interests, their accomplishments, their dreams, etc.

Once you know more about them, it’s much easier to think of ways to make and maintain that personal connection by letting them know you’re thinking about them. For example, you can send them a card;

  • On their birthday
  • On an anniversary (both personal – like a wedding anniversary – and professional – like an anniversary of their company being founded)
  • To congratulate them on achievements – (again, both personal and professional. Maybe they won a local golf tournament, or were given an award by the local Chamber of Commerce, etc.)

You also now have some of the most powerful tools in the history of mankind for staying connected. In fact, there’s frankly no excuse for not being able to come up with ways to make a personal connection. I’m referring, of course, to social media.

Facebook can give you great insights into what matters to your customers on a personal level. In an average Facebook profile, you can find a non-stop wealth of things to reach out with to acknowledge and congratulate your customers about.

Just be careful to make it meaningful (you don’t want to send them a card for a successful dentist visit). Also, make sure you connect outside of Facebook so your gesture doesn’t get lost in the clutter of other comments or posts.


Remember the L.O.V.E.

Last, but certainly not least, is a very important element of relationship nurturing. You must – what I like to call – “remember the L.O.V.E.”

Don’t worry, I’m not asking you to go on a hugging spree or to show up at your customer’s place with a candle and a serenade. In fact, there’s not much altruism here at all.

L.O.V.E. is simply my own take on a business growth idea that far too few small to medium sized businesses know about – the LVC, or Lifetime Value of a Customer.

L.O.V.E. (the Lifetime Opportunity Value Equation) – like the LVC – is simply the amount of net revenue that a customer generates for you over their lifetime of doing business with you. Here’s a simplified example:

Let’s say you sell hot tubs. Here’s how to calculate the L.O.V.E.:

  • The average initial sale for a customer is $5,500
  • The average annual sales per customer (chemicals, a new cover every three years, etc.) is $184 per year
  • Your average customer “sticks” for 8 years
  • So, $5,500 + (8 x $184) = $6,972
  • Subtract your costs of let’s say, $3,114, and the L.O.V.E. result is$3,858 of lifetime net profit per customer.

What does that number have to do with cultivating relationships?

As a side note, that number can help you calculate how much you can spend on cost per acquisition, but that’s a topic for another post. But as it relates to relationships, and making your customers feel special and appreciated, it means you can afford to “give a little”.

Meaning, when you consider that a customer will bring in nearly $7,000 dollars over their lifetime with you, is it reasonable to think you might be able to send them a nice $100 dinner voucher for their 20th wedding anniversary? Or, say, a $10 coffee shop card on their birthday?

Of course, by implementing a plan to nurture your relationships your L.O.V.E. total goes up. Why?

Because not only will the number of years your customers stick with you increase, your regular communications and reaching out also means the likelihood that they buy more from you per year will go up.  Now, let’s add a powerful piece of magic that the whole equation: the happier your customers are, the more likely they will be to refer others to you.

Think about that for a second. When you factor in the revenue that you wouldn’t have had without that customer’s referral and that customer’s L.O.V.E. gets even bigger.  And that brings us to the last thing to remember about giving back to your customers;
Take extra good care of your fans
A raving fan (in case you didn’t know, the word “fan” comes from a shortening of fanatic), can have a HUGE impact on your business. They buy from you more often. They talk about you on Facebook.  And they send more customers your way.  Let’s say a raving fan brings you three new customers this year. Because that is revenue you wouldn’t have had without them, your fan’s L.O.V.E. just increased to $11,574!

Now, because you know about the L.O.V.E., what if you surprised that fan with a $500 flat screen for being such a great and loyal customer? Since he’s already a fan, you’d better believe, he’s an even bigger one now. And the following year, he might just bring you 5 or 6 new customers as a result of your recognition and reward.

 

I hope this article gave you some food for thought on just how important your customers are, and how great relationships can seriously affect your business success. Before we go, I’d like to say something very important about all this: I want to acknowledge that the whole idea of relationship nurturing goes way beyond an “equation” or a calculation of what a relationship can just put in your pocket.

There is far more value in making people happy, and helping make your customers’ lives a little easier, than you can ever measure in a P&L statement.

So, as far as possible, be authentic with your care, concern, and appreciation of your customers. And as you remember the L.O.V.E…. remember the love.

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Posted in B2B eCommerce for Sellers, B2B Sales and Marketing, Business Growth and Development, Sellers Corner, Success Mindset, Tips & Tricks