Customer Retention Business System Pays Dividends
A customer retention business system should be top priority for every business! Why? To avoid customers coming in the front door and leaving out the back door!
Definition of Retention by Merriam-Webster: the act of keeping someone or something.
The most blogged and written-about topic in business is, SALES, sales and more sales. Next to sales articles, the hot topic is MARKETING, marketing, and more marketing. Business professionals are drawn to these topics like flies to a flame, and will tell you, “Nothing happens without sales.”
Consequently, there’s not as much written about Customer Retention versus Sales and Marketing. To be honest, the subject of Retention is NOT COOL like Sales and Marketing, nor as engaging and thought-provoking.
Getting New Customers is 5 to 25 Times Harder!
Did you know that experts in the topic of sales say, that getting a new customer is five to 25 times as hard as keeping an existing customer? Of course, that depends on the market. However, from my experience, I’d say it’s much harder to get new customers than to keep the ones you have.
Consider the following. A common complaint of Salespeople is, they go out there in the real world and bust their butt acquiring new clients. Then those who are responsible for delivering the product or service, screws up, and their new client walks out the door.
Put yourself in a salesperson’s shoes for a few minutes. Imagine working for a year to land a new client, and one stupid mistake by a so-called team member and it’s back to square one for the salesperson. Does this sound all too familiar?
Shouldn’t customer retention be just as important as Sales and Marketing?
Budgets: Sales and Marketing Versus Customer Retention
Companies spend huge portions of their budget on Sales and Marketing, hiring salespeople, and developing new marketing campaigns. But, if someone suggested spending the same amount on quality control and other business process systems that would ensure customer retention, many business owners would look at them like they were from outer space. Sadly, to many businesses that is an alien concept.
Ask for Sales Versus Support – Point Made!
To prove my point that Customer Retention is not as important as Sales and Marketing, call any well-known company and ask to speak with someone in sales. If I’m correct, a salesperson will be on the phone promptly. However, call back the same company, ask for the help desk or support and see how long you wait for service. Hmm!
What is a Customer Retention System?
Again, to retain is to hold on to something or someone. Granted, you can’t force a customer to stay with your company, therefore you must entice, encourage, and most of all, please them.
The most common practice is for companies to use their salespeople to smooth things over when mistakes happen. Unfortunately, the least common practice is, implementing a Customer Retention System, such as:
- An on-boarding system to document customers’ needs and to know them personally.
- A quality control system to ensure clients receive quality service and products; those promises made when wooing them.
- An enforced policy that ensures that support calls and emails are answered as promptly as sales.
- A follow-up system for ensuring that a customer remains pleased. When problems arise, generally speaking, many customers will not call to complain, they simply go away. For this reason, many times a good follow-up system gives businesses the opportunity to head-off and correct, bad feelings and disappointments with their service or product.
- Listening to customer grievances, then logging them in a system for continual improvement of products and services. Complaints will happen; however, they are the opportunity to show customers and employees that customer retention via real quality and service is just as important as selling and marketing.
Customer retention is not really a big secret, it’s a commitment to quality and service. It can be cool after all!
Did I mention? Great systems work?
Philip Beyer, founder/president of Beyer Printing and Ebiz Products LLC in Nashville, TN, is a chronic entrepreneur, business systems analyst and consultant, author of "System Busters: How to Stop Them in Your Business," and an InterTech Award recipient for the design and development of System100™ business process management software. Philip speaks to business owners across the country on how to bring lean, sustainable order to their businesses.