We spend a lot of time and money trying to acquire new customers. But if you’re adding those customers to a leaky bucket, you’re not growing as fast as you could.
Churn, left to its own devices, is a problem for any business.
Picture a business with 400 customers turning over $1 million per month with 5 percent monthly churn rate. By the end of the year, after that 5 percent churn month after month, the business will lose nearly 50 percent of its customer base. Just to keep level, it will need to acquire 200 customers … simply to replace the ones it’s lost.
Fixing that leaky bucket needs to be your number one priority.
Here are our top 9 tips for keeping customers loyal and never losing another customer.
1. Start with the right customers
Don’t settle for any customer type. Find the right customers for your business.
Sales teams are incentivized to bring in business, but they aren’t usually involved in retaining that customer. As a result, they’re more focused on getting the signature on the contract than in making sure the customer is the right fit.
While sales people are exceptionally good at persuasion and objection-handling to get customers in the door, poor-fit customers aren’t good for business.
The wrong customer takes longer to onboard, drains support time and inevitably walks away two or three or four months later. When the fit isn’t right, the wrong customer drains your resources. The initial sale just isn’t worth it.
It is much better to incentivize sales to find the customers to which you’re able to provide real, lifetime value. You know your target customer, and you know what kind of customer you like to work with. The world is a big place. Find your niche and stop trying to fit round pegs in square holes.
2. Support is for life
What would you do if you never made another sale? The only customers you would have are the ones you have right now.
If you knew that was true, you’d probably spend a lot more time trying to keep them around. Support would become much more important to the business than sales.
But here’s the secret. Support should already be more important than sales. Perhaps dealing with customer queues isn’t the sexy side of the business. It doesn’t seem to be bringing in the money like those multi-year contracts. But the value is there — focussing on your existing customers and really listening to what they say helps every part of the business.
Take, for example, the likes of Zapier Basecamp Help Scout. Every single person on their team, from every department, rotates through the support environment. Every single person gets to find out what customers are saying on the front line.
Why is this important? Because you can go back to your day job and actually relate to what customers are asking for.
It’s easy to receive things from support that say, “Hey, this is what’s going on.” But when you experience it yourself, on the front line, it’s a completely different thing. It helps you to get closer to customers, and it helps you do your job better to ensure that those customers remain with you.
So, don’t wait until the sales dry up to go the extra mile on your support strategy. Make your support work better from today onward and measure it with customer ratings.
3. Keep it simple
My daughter, age 8, could probably sell you on Customer Thermometer. A few weeks ago, she came into my office and re-created our customer satisfaction survey on my whiteboard.
You’ll see the ratings icons and a short sentence “How are you today?”
There’s a reason why she understands Customer Thermometer so well. We’ve worked hard to keep it simple. It’s one of our main business goals.
Why? Because customers do not like complexity. They love simplicity. We’ve tried to break down a complex idea, like customer loyalty, into a simple customer survey process that just works.
Stop complicating things for your customers. Work hard to make it as simple as possible for them. Remove the forms, eliminate the bureaucracy. Customers love to have their lives made easier.
Here’s another great test. Run the proposition you’re currently offering to the marketplace right now past an 11-year-old. Explain to them what you do and see if they understand it. See if they can repeat it back because it’s the best test you’ll ever find for your marketing messages.
4. Do the right thing
Don’t treat your customers like dollar signs. Treat them like people. Doing the right thing consistently is about creating loyalty with your customers. So often see companies try to maximize profits at the cost of morality.
Uber’s recent PR disasters give us a real-life example of how doing the wrong thing affects your business.
When NYC taxi drivers went on strike in January 2017 to protest Trump’s immigration executive order, Uber tried to capitalize on the absence of taxis and even advertised more aggressively during the day. Users didn’t react kindly. Over 200,000 users deleted their accounts that month. The hashtag #deleteuber even began to trend on Twitter.
The same hashtag began to trend again in mid-February when claims of sexual harassment in their engineering department began to surface. Then, the CEO was filmed arguing with one of their drivers. In just over a month, Uber’s reputation among users tanked and business has suffered.
Customers reward businesses that act responsibly and leave those that don’t. If you want to make sure your customers stick around:
- Make sure you take them off the unsubscribe list when they ask
- Make sure you refund people without question if there’s a problem with a credit card transaction or they don’t want the product or the service because it’s not quite right for them
- Get back to them quickly, regardless of their size or spend with you
- Be polite and professional at all times
While these things aren’t “evil corporation-sized problems”, they do matter to your customers. Don’t annoy people.
This is all quite negative. Let’s look at the positive side of doing the right thing.
We work with a lot of cleaning businesses across the world. The Cleaning for a Reason cause is absolutely wonderful. Cleaning businesses join Cleaning for a Reason, and then they donate free cleanings to help people suffering with cancer clean their houses and generally make their day brighter. To date, Cleaning for a Reason has given away more than $5 million worth of free cleanings.
Why not look around your business and see if there’s something great you can do? Customers love to do business with companies that share the same values as them.
5. Encourage complaints
It’s estimated only 1 out of 25 customers that have a problem complain about it. Picture your inbox like an iceberg. You can see the complaints that are above the surface. But the massive volume you can’t see is what sunk the Titanic.
We have the power to change that ratio. We want to get more customers with problems to contact us. Although it might seem counter-intuitive to seek out more problems, we can solve only the ones we know about. Complaints are a gift. Getting that silent majority to come out and talk to us helps prevent future surprises.
Customers are in fact quite happy to give feedback, provided the mechanism and timing of the request are right. Make it easy to complain. Consider a 1-click, simple solution to get customer feedback.
6. Embrace the service recovery paradox
Bill Gates once said “Your most unhappy customers are your greatest source of learning.”
Listening to feedback from exceptionally unhappy customers will show you where your opportunities are. But unhappy customers can also become your most loyal customers.
Huh? That’s right — effectively dealing with unsatisfied customers can turn the experience around into a positive one.
Why does this happen? While problems are a part of life, it’s how we deal with those problems that separates amazing companies from the competition.
Customers understand that things go wrong.
If you can successfully recover a situation, in the longer term your customers will become more loyal. This is called the service recovery paradox. If a customer knows that you’ll go the extra mile to resolve an issue — that builds trust.
More trust means they will stick around for the long game.
7. Incentivize caring
Humans are inherently driven by their own needs. Tapping into this motivation can help drive the right behavior across your entire organization.
While your organization can boldly proclaim “service oriented” on a website, or your department’s goals are to “Care about our Customers,” we all know that actions speak louder than words. Unless everyone on the team is pulling in the same direction, there will be a mismatch between your promises and what your customers perceive.
Incentivizing the right actions for your front-line team is exceptionally important. You might publicize satisfaction results or tie bonuses to individual results.
Here are several great examples of pulling together. A couple of our customers have created charts to track each employee’s ratings. Imagine walking up to the wall and getting to add another star to your tally. Pride in doing good work is an excellent motivator to continue caring about customers.
8. Don’t be surprised
Ever had a customer go radio silent and then leave? It happens to the best of us.
The key to preventing this is to not allow yourself to be surprised. If you’re only checking in with your customers once a year in a 50-question survey, you’re missing your opportunity to be proactive.
Ideally, you want to know the minute a customer’s perception of your service turns. Remember the live audience ratings for political debates? The moment a politician said something the audience liked (or disliked) their ratings showed it in real time. That kind of real-time feedback is invaluable for learning what works for your customers.
While that’s not quite possible for businesses, the idea of that regular pulse, particularly in the service industry, is an incredibly valuable thing. This means providing customers with an ongoing avenue for feedback.
Do feedback the right way. Find out what really matters to people. Even if you don’t use Customer Thermometer, get the right mechanism in place and talk to your customers so that surprises don’t happen.
Remember that 68 percent of customers leave you because you feel “indifferent” toward them.
9. Create memories (good ones)
All of us, from employees who work in retail to employees managing servers, are mostly dealing with people. And people (customers) remember good experiences.
Maya Angelou said it best: “People will forget what you did. But people will never forget how you made them feel.”
Focus on the person you’re dealing with right now. Create a good experience and resolve their issue however you can. When they look back on your company in a week, a month or a year, they won’t remember the specific problems they had. But they will remember how you made them feel.
Make sure that it’s a happy feeling.
We’ll be at Kaseya Connect 2017 in Las Vegas! Drop by our booth to swap notes on keeping customers happy and learn about our 1-click feedback solution for Kaseya VSA and BMS tickets. Find out more here.