Is relationship marketing a key aspect to your marketing strategy? If not, it is time to re-evaluate your marketing strategy, and how you spend your marketing budget. Typically, businesses spend 80% of their marketing budgets on going after new customers and attempting to gain new business, yet this does not result in an 80% increase in sales and business.
Building existing customer relationships and expanding customer retention is an important strategic aspect to consider. A new and growing business, of course, needs to constantly capture new customers to grow its customer base. However, it is important not to lose sight of who your customers are, even if they have purchased from you only once.
Why Does a Customer Defect?
There are several reasons why clients may decide to leave you and go to a competitor, but the ones heard most often are:
- They felt your pricing was too high or unfair
- They had an unresolved complaint
- They took a competitors offer
- They left because they felt you didn’t care
In this list, it is the last two reasons that make up the majority of lost customers, which can be a difficult realization, but one that can be turned around. Business, by nature, is competitive; you may not always be able to meet or beat the prices of large companies who can buy in larger quantities. But preventing a customer from leaving you because they feel unimportant is wholly within the scope of your control and responsibility.
How to Retain your Customer Base
There are several ways to achieve the goal of retaining your customers and making them feel that their business is important to you. The main focus here is building that relationship, finding ways to connect with your customers. Learn about their needs and what they are looking for when they make an online purchase, how to meet these needs, and very importantly, to let your customers know that you value them.
In the seemingly endless world of internet business, it is easy for a customer to feel like a number that does not matter to a corporation. Nothing could be further from the truth, and you need to make sure you customers know that. If one customer feels ignored and switches to a competitor, not only do you lose the business, but you could potentially be harmed by unhappy word-of-mouth discussions.
Customers often feel an affinity for the “little guy” in business, the “underdog” so to speak. People routinely pay more for the same vacuum cleaner bags at a mom & pop store than at a big conglomerate hardware store for a variety of reasons. But the main reason is the relationship they build with the owners, the feeling that they matter, and that the owners are happy to see them when they walk through the door.
The same is true in internet marketing. It is a more complicated avenue, but the sentiments remain the same. People like to feel noticed, and that their business is important. If you can create relationships with your customers that make them feel this way, you are well on the road to customer retention and a solid customer base.