Four Steps to Successful Customer Relationship Management

Don't frustrate your customers! Keep them happy and loyal with these tips

The importance of customer retention is obvious to most business owners. First of all, a business without customers isn’t going to be a business for long. What’s more, research indicates that customers who have been using a particular brand or product for a long time spend more than newcomers have.

According to MysteryShoppingLive.com, businesses on average lose 10 percent of their customer base each year. However, companies can boost profits enormously by retaining 5 percent more existing customers. If a company can retain just 2 percent more customers, the resulting profit increase is the equivalent of cutting costs by a tenth.

Clearly, keeping shoppers loyal is crucial to a successful businesses. But how can it be done? In today’s economy, many shoppers just grab the cheapest item on the shelf. However, there are a few things you can do to keep customers dedicated to your specific brand – and most of them are simpler than you might expect.

Here are four easy steps to keeping customers happy and coming back for more.

1. Encourage face-to-face interaction
Whenever possible, communicate with your customers in person. This is usually easier for small businesses than it is for major corporations, but it can be done. The Apple Store is an excellent example of face-to-face customer service. If an Apple user has a problem with his or her iPhone, Mac computer, iPod or other gadget, he or she can simply walk down to the nearest store and have a technician fix the problem quickly and efficiently.

2. Ensure that customers have a positive experience
Of course, that doesn’t do much good if the technicians aren’t friendly and engaging. Make sure your staff is trained to be welcoming and patient, even with customers who may not be as informed about the product as they could be. A positive interaction with company representatives is equally important whether you handle customer service in person, on the phone or through other channels such as email or Twitter.

The saying is true – customers can hear a smile through the phone. Staying positive during all customer interactions is essential to keeping customers feeling happy and valued. And as any politician who has made an off-color remark without realizing the microphone was still on can tell you, the best policy for badmouthing customers or complaining is simply to never do it.

3. Define your customer service policy
Customers should know which steps to take if they encounter a problem, have a question or simply want to offer feedback. Customer service contact information should be clearly displayed on your website and even on your products themselves. Is there a specific number to call for technical assistance? A separate line for billing inquiries?

There’s nothing more frustrating for a customer than spending hours on the line being passed from person to person or not knowing who to contact in the first place. A customer who can have an issue resolved quickly is much less likely to harbor any ill will than one who had a difficult time finding the assistance he or she needed.

4. Pay attention to the small things
All the little niceties – sending out birthday coupons, happy holidays emails and personalized responses to questions, for example – can add up. They may not always be cost-effective, but customers remember and value them. Even if you merely send out a “Happy Holidays” newsletter, you’re doing something to remind your customers that there really are people who put work into creating the products they value. What’s even better is that customers will take away the message that you care about them and value them.

Customer retention is a difficult game, but there’s more to it than just the lowest price. Taking the time to manage and maintain your relationship with your customers can pay off handsomely when those customers remain loyal even if a competitor introduces a cheaper product.