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Customer Loyalty Means Bigger Profits – 5 Tips For Repeat Business

By Dianne McLay

I always buy my fresh fruit and vegetables from a little corner market, even though it's right near a big supermarket that sells at cheaper prices.

Why am I a loyal customer despite the fact I have to pay more?

It's because they remember my name each time I shop there, and if my bag is too heavy, they'll deliver it to my home. The big supermarket does none of these things.

If that small business didn't look after their customers, they'd be forced to close their doors within a month. Repeat business is absolutely essential for their survival. It's essential for the survival of every small business.

So as a small business owner, how do you make sure your customers become repeat customers?

1. Say “Thank you”

It's so simple, so effective, and unfortunately so rare to be thanked when you purchase from a small business. We all like to feel special and so do your customers.

I'm not talking about the mindless, 'Thank you shopping at the XYZ store' as you go through the check out. Be sincere and make your thanks specific. "Thank you for buying your weekend newspaper from us. Did you realise you've been coming in for a year now?"

You can also send a thank you through the mail. Make it easy by having some cards printed up with your logo and contact details on one side, then hand write a thank you note on the other. Nobody does this anymore so it will have a high impact.

2. Send Reminders

Any small business that provides a service or sells a product that can be upgraded can send out reminder notices. Here are a few examples:

• The mechanic who services my husband's car sends a reminder notice every six months.
• My dentist sends me a card every six months telling me I'm due for a check up.
• Our accountant reminds us at the end of each year to see him about our tax.
• I often get emails from software companies reminding me that it's time to upgrade to a newer version.
• A chiropractor I interviewed sends reminders to patients who haven't visited for six months to come in for a free spinal check up.
• A printer ink supplier emails customers to remind them that their printers might be low on ink. The email provides a link to their on-line store.
• The termite inspection company that checks our house sends a reminder notice each year.

3. Be Reliable

This is such a basic rule, but it's surprising how few small business people get it right.

I interviewed the owner of an award winning electrical firm that gained all of its clients from word-of-mouth advertising. The owner said that the quality of their work was no better than other firms'. How did they do it? The secret of their success was their scheduling method which allowed their employees to always be on time. Word got around very quickly.

It's very simple: turn up when you say you will. If you are going to be delayed, have the courtesy to call BEFORE you're late. Allow the customer to make a choice of whether they'll wait for you or reschedule.

If you tell your customer their goods will be delivered by Friday, make sure they are.

On the other hand, if you find you're running ahead of schedule, call first. Your customer might not want the new office furniture you're delivering to clutter up the reception area if they're expecting a visit from an important client.

It's almost too obvious to talk about returning calls and emails.

Make a commitment to be reliable and your customers will buy from you again and again.

4. Reward the Gatekeepers

By gatekeepers I mean the receptionists, secretaries and personal assistants who may or may not give you access to the boss.

Years ago I worked for a big company as a personal assistant to the Managing Director. He used to be given all sorts of freebies from suppliers such fruit baskets, tickets to the opera and bottles of wine. One Christmas, David the owner of a training video company gave me a beautiful diary instead of giving it to my boss. After that, when David called, I always put him straight though to my boss and I'm sure this contributed to his company becoming our preferred training video producer. He upgraded to a BMW, all because of a diary.

Gatekeepers are important for your business success. Look after them.

5. Don't Discount – Value Add

Christine, who owns a day spa and massage therapy business that I write brochures and advertising copy for has a policy of never, ever discounting. There are seven other similar business close by, so competition for customers is fierce. Over the years we've seen a number of these businesses discounting to the point where they're barely able to make a profit. It doesn't take long before they're put up for sale.

Discounting attracts customers who chase cheap massages. So how does Christine's business maintain a solid base of repeat customers who gladly pay full price?

Value adding. She rewards her repeat customers with add-on services. For example, a loyal customer may receive a gift voucher that entitles them to a free 10 minute hand pamper with their next one hour massage.

What's more, the customer often enjoys the extra treat so much that they're happy to pay for an add-on service next time.

Remember my corner market? They don't even try to compete on price with the big supermarket. They value add by making home deliveries for their customers.

Repeat Customers = Profitable Customers

Have you ever worked out how much it costs you to gain a new customer? A rule of thumb is that attracting new customers costs you five times more than keeping your current customers. Focus on keeping your existing customers happy and loyal, and you'll save on expenses and increase your profits.

Dianne McLay is a freelance writer. Visit her blog at http://dianne-mclay.blogspot.com/. She also writes for http://www.urbanretreat.net.au/.

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