How to Keep Your Customers Loyal (and Keep Them Buying)
Three Ways to Maintain Customer Loyalty
Having loyal customers is good for everyone involved. The customer wins because he has an ongoing supply of a product he likes from a company he trusts and doesn't have to spend more time and energy researching options every time he makes another purchase. The company wins because the more a customer buys, the more money they make; loyal customers also tend to produce higher profit margins because the company isn't spending more money to find and pitch to them. And the salesperson wins because that steady stream of customer purchases becomes a steady stream of commissions.
Resolve a Customer's Problem Quickly and Easily to Build Loyalty
The natural assumption most people make is that the best way to create loyal customers is to give them perfectly functioning products. Surprisingly, that's not the case. The Customer Contact Council, an entity that conducts research on customer service-related topics, discovered in one of its studies that customer loyalty is strongly associated with the amount of effort a customer must make to resolve problems related to his supplier. In other words, a customer who can quickly and easily resolve any problems is far more likely to stay loyal than a customer who never has a problem pop up at all.
The study in question calculated that 94 percent of customers who can resolve issues painlessly would purchase again from that company, but there was no connection between customer satisfaction and customer loyalty. This is a particularly important concept for salespeople to understand since they're often the first person a customer will call if a problem develops – particularly if they've just made the purchase.
If a customer calls with a problem, you can rejoice because it's an opportunity to resolve the problem quickly and painlessly and therefore turn him into a loyal customer. You can almost ensure that he'll buy from you again just by providing excellent customer service. It's also a good reason to stay in touch with customers after the sale has closed so that you can encourage them to reach out to you with a problem instead of just giving up and deciding to buy from someone else.
You may end up burning some extra time working with the tech support department or the repair department to help customers, but you'll get your reward in the form of future purchases from those customers and probably even referrals of friends and colleagues. The time you spend on customer service is actually an investment in future sales, just like cold calling or asking for referrals.
Making allies on your tech support team can help speed things along when a customer problem falls into your lap. It will also help a lot with customers who have already put in some work on their own trying to get things fixed. It's also a good idea to keep track of common customer complaints and any newly uncovered product issues so that you'll know how to resolve them quickly.
Conduct Regular Account Reviews to Build Customer Loyalty
Another powerful way to build customer loyalty (not to mention more sales) is by conducting regular account reviews. An account review just means sitting down with the customer and asking questions related to their needs and your products. It's also a chance to make sure the customer is happy with your company and not quietly planning to bail out on you. Sometimes customers won't call because everything is fine, but it's also possible that they've been struggling with the product and just haven't thought to reach out to you for help.
The first part of an account review happens well before you talk to the customer. Most salespeople have a portfolio of accounts that make up their territories. You need to go through your accounts and determine the level of opportunity that each one represents. For example, a customer who just barely qualified to buy one product and doesn't have enough resources to purchase another would be a low opportunity. So would a customer who already owns everything your company makes and isn't due to need replacements for a while.
High opportunity accounts would be the customers who have bought one or two products, and have the resources to buy more but haven't done so.
All of your accounts should receive periodic reviews, but the high opportunity ones should get a lot more of your time and attention since you have a much better chance of getting something back. As a rule of thumb, low opportunity accounts should have a review at least once a year, while high opportunity accounts will call for more frequent reviews. The exact schedule of reviews that will work best for you will depend on the type of product you sell and on who you sell it to.
Once you've assigned different opportunity levels to your customers, your next task is to prepare a list of questions to ask during the review. The goal of an account review is to determine how the customer feels about you and your company; whether he has needs that you can meet by selling them further products; and what contact, if any, your customer has had with your competitors. The questions you ask should seek to uncover information in all three of these critical areas. With touchier subjects, you may need to use subtlety to get the answers you need.
For example, rather than asking “What contact have you had with Company X?” you might ask something like, “What consideration did you give to other vendors when you bought this product?” That gets the customer talking about your competitors without making it sound like you're worried about them.
When you have your questions ready, it's time to call up a customer and schedule the review. With most customers, the best way to open the subject is to present an account review as a chance for you to confirm that everything is going well and the product is ideally configured for your customer's needs. If the customer is reluctant to schedule a meeting, you can add that you are offering the review for free because he's a valued customer. The idea of getting something of value for free is often enough to convince him to make the time for you.
Once you've asked all your questions, you need to take that information and make a recommendation. If you didn't uncover any sales opportunities, you could still fulfill the loyalty-building function of the review by pointing out ways that the customer can use the product more efficiently or otherwise improve its performance. Such suggestions will help you to build rapport with your customer and increase your chances of making future sales.
Keep in mind that sales opportunities are not necessarily limited to selling the customer a whole new product. Many products come with some up-sell option, and your customers may not realize how helpful such options could be. For example, if a customer has spent a lot of time tinkering with the product to maximize how well it works for him, a maintenance contract could save him more than enough time to be worth the cost. An account review gives you a perfect opportunity to uncover these kinds of issues.
Proving Your Product's Value to Maintain Customer Loyalty
Another function of the account review is the opportunity it gives you to prove your product's value to your customers. No matter how many competitors you have, there's something unique – and better – about the products and services you sell. If there weren't, you wouldn't have any customers at all. The more unique and valuable your customers think your product is, the less likely they are to leave you and start buying from a competitor.
When a customer starts thinking about switching vendors, what he's really doing is evaluating what he has to gain by making the change versus what he stands to lose. The most important for you to keep in mind is that it doesn't matter how valuable your product actually is to the customer – all that matters is how the customer perceives the product.
The first step in proving value is figuring out yourself what your product's value is. You probably already have some ideas about what makes your product valuable. However, your ideas may be totally different from what your customers actually value about the product – and naturally, it's what your customers value that really matters. So your best starting place for identifying value is with your customers. Call up a few of the customers you're friendliest with and ask them what they like best about your product, and why they stay customers.
It's best to talk to customers of different types and sizes because they'll probably give you different answers. Getting a variety of customer viewpoints will help you because you can then match up the value you're promoting to each customer based on what you know about them.
Next, consider other ways that you might add value aside from the product offering itself. For example, are you offering excellent customer service? Do you act as a consultant for your customers by offering them ideas to help them squeeze more functionality out of the product? Do provide flexible options for delivery, maintenance, payment, and so on? When there's a problem, do you take charge of the issue until it's resolved? These are just a few of the ways that you can add value yourself.
Once you've perfected the art of proving value to your customers, you will gain an extra benefit because the skills and information you've developed apply extremely well to prospects. For example, if you've scheduled a meeting with a prospect and you happen to have a customer of the same size and type, then whatever the customer values most in your product will probably appeal to the prospect. You can build your sales presentation around that particular value and be confident that your prospect will be interested.