When prospecting for new business, the importance of timing cannot be exaggerated. You need to reach your prospect at just that moment when she is seeking the product or service that you offer, and then convince her that your company is the right one to be doing business with. But, what is the most important thing of all is making her a loyal customer who will come to you for repeat business.
Amazing as it might seem, it has been demonstrated that a five percent increase in your repeat business equals a 60% increase in your profits. That’s a lot of leverage. Customer loyalty is the way to wealth and success in your business practice.
What is the Tao of Customer Loyalty?
To begin, nothing can take the place of persistence. In your business practice, just as with the pursuit of your personal dreams and objectives, persistence is the foundation of all success. Without persistence, you can achieve nothing of importance.
Beyond persistence, you must practice the principle of differentiation. Differentiation means clearly defining exactly what it is you do or offer. It is the way of setting yourself apart from your competitors.
Business consultant and author Manzie Lawfer, with whom I had the pleasure of working at a small multimedia firm for several months, has this to say about practicing differentiation when he is selling two-way communications devices:
“I tell my prospects and customers that instead of giving you a 5% or 10% discount we: Give you a single point of contact; you’ll never have to call receivables or shipping or any other department; make sure that your order is shipped no later than the next business day; place a four year warranty on every radio we sell; provide no cost loaners when you send your radios in for repairs; give you a free trial on radio equipment and accessories before you buy; charge a $119 flat fee for repairs; provide you with the experience, dedication, and availability to help you solve your communications problems; give systematic updates to keep you informed of new technologies and new uses of existing technologies; do not tack on extra charges. That is, you’ll never have to call to find out why or have explained to you by accounting why there was an extra $5 or $10 on the bill. Invariably when I take the time to review these nine points, customers tell me they like these additional services better than a discount.”
Value and assurance are the loyalty principles that say, “The customer absolutely always decides what is of valueÃ¢Â?Â¦and if you want your customers to come back, then they have to believe they will receive the same value every time they return.”
Value is not pricing. Price is only meaningful when the prospect or customer doesn’t have anything else to compare and contrast. Therefore, the importance of price is directly proportional to how much a prospect or customer knows about your product, your service, and you. You have no way of finding out what a customer’s values are other than by asking him. When you consistently and persistently ask a customer what is of value to him, and then find the way to deliver those valued things to him, you are creating a loyal customer who will come back to you over and over again.
The way you create assurance is by keeping your word. You do what you say you will do, when you say you will do it. Incredibly, studies demonstrate that most business people do what they say they will do only 20% of the time. What that means is, four out of five times, most business people fail to keep their word! 80% of the time, most business people essentially make liars out of themselves. Why should their customers feel assured in the face of that? If you just make your word law, you will cultivate a fierce customer loyalty.
Creating customer loyalty also requires effective communications. This begins by showing gratitude. You need to show that you are truly grateful for your customers. When you call your customers, give them thanks. This is an effective way of communicating your feelings of gratitude for their patronage. All customers desire to feel important; thanking customers makes them feel that way. And when you make your customers feel important, they desire to do keep giving you their business. Effective communications also means having continuing and meaningful contact with a customer. One way of achieving this is by always asking a customer, every time you speak to her, “When should I follow up?” Then, when you place your follow up call, remind her, “you asked me to follow up with you today.” Doing this practices assurance as well as effective communications.
Another method is the creation and distribution of a regular, periodic newsletter (especially e-newsletters in our contemporary digitized world). Make your newsletter informative, not merely a thinly disguised advertising piece. This gives it value, and the customer sees it as a value-added service. In addition, it keeps your business’ name consistently in front of the customer’s eyes as a meaningful reminder of what you provide. But perhaps the most powerful means of having meaningful contact is by sending thank-you cards or letters after every buying transaction with a customer. Saying “thank you” on the telephone is a good thing, but you can do better. Sending a thank-you email is better. But the very best way to communicate your sentiment of gratefulness to your customers is by purchasing a box of thank-you cards that are blank on the inside. Personally handwrite and sign every one of your thank-you cards whenever you send one out, and send it via the regular mail. This personal touch makes for very potent communications.
Have persistence. Differentiate your business. Communicate effectively. Keep your word. Have health and wealth.