I think sometimes we focus so hard on getting new business that we lose sight of how crucial it is to keep existing customers coming back for more. Customer loyalty is one of the strongest indicators of how healthy your business is and it should be a big part of your business strategy. The percentage of customers who continually come back for more of your products or services is proof of business goals set and achieved.
Retaining customers is vital to your business development efforts, and is far more impactful to your bottom line than getting new ones. Companies with a great new business funnel don’t necessarily outperform those who keep clients long-term. I’ve seen companies that effectively use marketing materials to tout how different they are from the competition. They focus on how they add value to justify their price point and close a lot of new business. But these companies tend to turn over their clients every 2 to 3 years and they are forced to keep filling the pipeline over and over. It’s clear that a business strategy focused on retaining customers by delivering on promises creates consistent revenue and a healthier bottom line.
One of my clients was constantly turning over their client base. As quickly as they brought in new clients, the old ones would jump ship. What we learned was that their operational strategy needed work. They had the wrong type of employees and processes in customer service, which was directly affecting satisfaction of their customers who were already was under constant siege by competitors. We made some minor tweaks and one personnel change to set the example, and now customer retention is way up and each account is growing steadily.
How many existing customers have you sacrificed for new ones and how much has it cost your business?
Howard Shore is a business growth expert who provides business strategy and consultation services. To learn more about how an executive coach, management consultant, leadership training, or business coach can help your team with employee engagement, please visit his website at www.activategroupinc.com or contact Howard Shore at (305) 722-7216 or email him.