You manage your company’s budget. You manage your employees. But do you manage your customers?
By strategizing about the best way to leverage your customer’s loyalty and influence, you can increase your bottom line and grow your customer base.
Here are three secrets to effective customer management:
1. Ask people’s opinions. Everybody likes to feel as if they are part of something and their opinions matter. Solicit your customers’ honest feedback about their experiences at your business, either in-person or through an online survey. Ask for their thoughts about promotions and new products or services. Listen to their compliments, criticisms, and ideas without becoming defensive. In doing so, you will gain valuable information about your operation and make your customers feel important.
2. Encourage referrals. Customers who are referred to a business by their friends, colleagues, or family members are more likely to become long-term clients than those who find a business on their own. According to the 2011 study “Referral Programs and Customer Value” by Wharton University, referred customers have an 18 percent higher rate of staying with a company than other customers. Referrals are also one of the least expensive ways to grow your business.
The best way to encourage referrals, of course, is to provide excellent products and great customer service. You can also increase referrals by offering incentives. One strategy is to hold a contest in which everyone who refers a customer during a set time period is entered into a drawing for a lucrative prize. Another is to offer a discount, a gift card, or a cash award to customers for each referral they make.
3. Offer a high-value loyalty program. A loyalty program can help you encourage repeat business and increase sales, but you must create one that provides value to both you and your customers. To do so, consider the types of purchases that are most profitable for your business and build your program around them. (Consider using a mobile loyalty program for everyone’s convenience.)
Publicize your offer on your website and social media pages and in your company newsletter. Employees should also ask customers whether they would like to join. Use the information you gather about people when they sign up — name, email address, phone number, etc. — to communicate with them about additional promotions and new products and services.