6
Nov
2007
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How to Take Care of Existing Customers

bird-in-hand.jpg Business is tough to juggle sometimes.  We have to focus on two main areas when it comes to our customers: bringing new customers in and taking care of existing customers.  The old idiom, “A bird in the hand is worth two in the bush,” comes to mind here.  I like this definition from the New Dictionary of Cultural Literacy (Third Edition, 2002). 

The things we already have are more valuable than the things we only hope to get.

From my experience, many companies spend most of their time and budget focusing on the sale to new customers and end up neglecting their existing ones.  This works in the short-term, but eventually these companies find themselves losing more customers out the back door than they bring in the front door. 

Example

Here is a hypothetical example.   Company A, a business-to-business  manufacturer, is growing rapidly and has had a big year-end push on getting new customers to purchase their product.  During their latest promotion, Company A saw a lot of interest in their product and was able to acquire several new business customers.  As the promotion drew to a close, the focus remained on bringing in those last few customers who had expressed interest but weren’t yet “in the fold”.  Company A succeeded in beating their promotion goals by bringing in additional business for the year.

Was Company A successful?  Yes, with their goal of bringing in new customers.  Were they successful in taking care of existing customers?  Yes.  They didn’t lose sight of those that had already purchased before and during this big push because Company A has a team of people that focus on keeping and growing existing business.

Five Tips

Here are a few tips for companies to ensure they aren’t letting go of the “bird in the hand” while pursuing those in the bush:

  • Be sure to thank customers when they buy from you.  Whether products or services, you want customers to know you appreciate their business!  If possible, a personal thank-you card is best when you have a small or targetted group of customers. 
  • Recognize a return customer.  If a customer has purchased from you before, acknowledge that in your thank-you note.  A customer doesn’t feel valued when they get a note saying “Thanks for trying us.” when they have been buying from you for 5 years!
  • Properly welcome a new customer.  This could be a customer who is new to you altogether, or they may be new to this part of your company.  Best practice organizations provide “welcome kits” to help customers navigate the system or get started.  It could be as simple as the name of their account manager along with that person’s phone number.  The kit is usually sent after the “thank you” note goes out.
  • Follow up with existing customers on a regular basis.  This could be an email or note to customers (especially useful if you have a lot of customers, as many consumer-focused companies do) or a quick phone call to see how things are going.   Use whichever interaction approach your customer prefers.  NOTE: This is not a sales call!  The best way to turn off existing customers is to constantly pressure them for business (see Seth Godin’s post today on Spam for examples of how not to do it, especially his Dell example). 
  • Look for ways to improve the relationship.  Let your customers know you truly value their relationship with you by asking them how it could be made better.  Needs change.  Budgets shrink and grow.  By keeping in touch with your customers and understanding their needs and preferences, you will be aware of these changes and can react to meet those new needs.

Taking care of existing customers can’t be left to random chance.  It also can’t be left only to great customer service personnel who react when there is a problem.  Taking care of customers needs to be an ongoing, proactive part of the business.  This will take time and budget. 

But it’s worth it: just ask Harley-Davidson!  They were the subject of one of my first blog posts here at Customers Rock!, and they have legendary customer loyalty.  They are truly a great Customers Rock! company.

(Picture credit: Erika Aoyama, November 16, 2002)

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22 Responses

  1. Pingback : Business Marketing » Blog Archive » How to Take Care of Existing Customers

  2. My wife and I recently went down to Nevis in the Caribbean. We split our time between a small Inn in the mountains and the Four Seasons on the beach. The Four Seasons was great – but you were a room number. At the Inn, you were treated as family and they were sad to see you leave.

    One day while we were at the Four Seasons, my wife ran into the owner of the Inn. He was playing with his twin girls at the Four Seasons play ground. He recognized her, called her out by name (we had only been at the Inn for 4 days mind you), asked how we were and wanted to make sure we were being taken care of.

    I was blown away. We will we go back to the Inn – without a doubt. Will we hit the Four Seasons again, maybe.

  3. Matt, great example of a customer interaction concept I have discussed before, the personal touch. When a business takes the time to get to know their customers and develop a relationship, it makes all the difference in the world. People and relationships are a true competitive differentiator. They also make it harder for a customer to say goodbye!

    I look forward to hearing about your next visit to the Inn to see how they remember you. I’ll bet they do!

  4. Thanks, Lewis. I like your idea of a quarterly outreach. Every company should indeed have an ongoing plan of communications for its existing customers, not just its “marcom outreach” plan.

  5. I could not agree more. Taking care of an existing customer is very practical from a business sense as they will continue to patronize your business and in turn, your revenue will continue. I have seen, experienced and also been on both sides of the coin – service provide ignoring the current customer and service provider focusing on the current customer.

    Great post, thanks!

    Brandon

  6. Becky,

    Great reminder. I’ve had bosses that did not have a healthy balance – usually they focused too much on the “hunt” and as soon as the contract was signed, they lost interest and moved on to the next big sale. Maybe I should forward them your post…

  7. Brandon, thank you for chiming in! Too many companies forget about the existing customers. I want to emphasize that this goes beyond just making sure customer service is taking care of customers; it needs to be part of the DNA of the whole organization! Thanks for your insight, and come back soon.

    Bill, please do forward them my post! 😉 One of the goals here at Customers Rock! is to spread the word about how to improve the customer’s experience. The experience is a poor one if they are forgotten after the contract is signed. Of course, there will always be those people who love the thrill of the “hunt” – and they are great salespeople. The rest of the organization needs to align behind a great strategy to retain and grow those customers brought in by sales. Thanks, Bill!

  8. Brandon, thank you for chiming in! Too many companies forget about the existing customers. I want to emphasize that this goes beyond just making sure customer service is taking care of customers; it needs to be part of the DNA of the whole organization! Thanks for your insight, and come back soon.

    Bill, please do forward them my post! 😉 One of the goals here at Customers Rock! is to spread the word about how to improve the customer’s experience. The experience is a poor one if they are forgotten after the contract is signed. Of course, there will always be those people who love the thrill of the “hunt” – and they are great salespeople. The rest of the organization needs to align behind a great strategy to retain and grow those customers brought in by sales. Thanks, Bill!

  9. Matt, I enjoyed reading about your experience with the Four Seasons with your latest vacation. We had a similar experience in Isla Mujeres, with a twist. The resort we stayed at was great (paid attention to the ‘little things’ – big in my books), but the TIMESHARE company associated with the hotel completely turned us off and really left a bad taste in our mouths.

    So, like you, will we be back, probably…will we be staying where we did…probably not!

  10. Darren, isn’t it amazing how little things do make such a big difference! They could be “good” little things, such as what your resort did for you, or they could be “bad” little things, such as the way the timeshare company behaved. Too bad the resort can’t get your business without having to deal with the timeshare company; they have let their distributor/marketers ruin a good thing.

    Great blog, Darren. Keep up the good work!

  11. RichardatDELL, thank you so much for taking the time to respond, both to my post as well as to the concerns about the way customers were approached in that particular interaction. It is great to see you participating so actively in the blogosphere; you are definitely an example for other companies to follow!

    Letting customers know you hear them and responding indicates a Customers Rock! attitude, and for that, I salute you and Dell.

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