Build-customer-loyaltyNumerous factors can affect how loyal a customer is likely to be to your business. Here are the main building blocks to put in place.

1. Compete on cost

The cost of your product or service is usually an easy factor for customers to compare. It should therefore be the first thing you put into a customer retention strategy: a competitive price will always lead to business.

However, as an SME, don’t base your strategy solely around cost: it can potentially be a challenge should you end up competing against larger corporations with greater buying power.

Plus, with a purely cost-based strategy, all it takes is for a competitor to lower their prices, and you’ve lost the customer.

As an alternative, think of ways to take price competitiveness further, into more sophisticated styles of loyalty. Why not try implementing a customer reward scheme, or offering discounts for multiple orders? Most of us are happy to collect stamps from coffee chains, so “the tenth cup is free” – how about taking that mindset into your business?

2. Provide a tailored service

This should be the heart of your retention strategy: it’s the point of difference where you can beat the bigger players. As an SME, your aim should be to make customers feel they can’t go to a competitor – because they’d lose the personal touch you give them.

By being empathetic, anticipating what the customer wants, and tailoring your offering to their needs, you’re likely to see a happy client – and repeat business.

Just be wary not to take this too far though. You don’t want to end up providing services for such a reduced cost or tight timeframe, or with so many ‘little extras’, that you actually lose money. This is where customer retention becomes a balancing act, so work on little things that make a big difference: for example, ensuring the customer always gets to speak to the same person.

3. Stay in touch

If your service is one that clients go long periods of time without needing, then it’s essential you stay in their mind. A little communication is needed here, but it’s important to choose the right method based on what you’re trying to achieve.

For the personal touch, nothing beats a phone call. Calling customers to ask them if they’re happy with your service can be a great way of reminding them you’re still around. Handwritten notes are great too.

Social media is another cost-effective channel. Facebook and Twitter are great ways to announce promotions, deals or practically anything that keeps your firm at the top of the customer’s mind. They are also effective ways to invite comment and feedback, and respond to it. This is another vital component of the full customer loyalty picture. (See the article in this issue about making the most of Facebook).

4. Keep at it!

Improving customer loyalty isn’t an overnight process. Developing a strategy will take time and effort, so adopt a trial and error approach.

And remember that while you’ll hopefully see some returns from the techniques outlined above, there are always two other, even more powerful, reasons that customers will keep coming back to you: reliability and quality.

Getting those right goes above and beyond the techniques of customer retention strategies, but is absolutely critical.

 

Disclaimer:
“The opinions expressed within this article are generic. Mashreq is not responsible for the accuracy, completeness, suitability or validity of any information on this article. The information, facts or opinions appearing in this article do not reflect the views of Mashreq. Mashreq does not assume any responsibility or liability for the same.”

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