Focus on Retaining Customers for Continued Growth

It seems to be human nature to always be chasing after the newest thing. As just one example, think about how many people eagerly anticipate the latest product from Apple. When the new iPhone 5 was introduced last fall, people in New York City set up camp eight days in advance to snag the latest model.

It’s no different in the business world when it comes to chasing the newest big customer. Maybe it’s the thrill of the hunt and the excitement when you finally sign on the dotted line for a huge purchase order, or hear those sweet words, “We’d like to hire you.”

Of course, you’ve got to constantly be working to acquire new customers. Even when your business is humming along at full capacity, you’ve got to keep filling the pipeline to keep your business growing and replace any lost business.

The problem is when all the attention is focused on landing that new customer, without paying adequate attention to current customers. To keep your company growing and thriving, you’ve got to maintain focus on retaining the customers you have.

Here are just a few reasons it’s important to do so:

• Statistics show that 80 percent of your company’s future revenue will come from just 20 percent of your existing customers.

• A 5 percent increase in customer retention can increase a company’s profitability by 75 percent, according to a study done by Bain and Company.

• Estimates show that it costs five times more to attract a new customer than maintain an existing one.

• U.S. corporations lose 50 percent of their customers every five years with an average defection rate of 10 to 30 percent each year, according to business researcher Frederick Reichbeld.

That’s a lot of money walking out the door that you may be able to save. If you’re not paying enough attention to current customers, you need to start now. So what should you do?

The good news is that it doesn’t have to take a lot to keep current customers happy. It can be as easy as regular phone calls, just to check in and ask how everything is going and if there are any concerns you need to address. Ask if their business is about to undergo any major changes where your company may be of help.

Make sure your current customers get notice of upcoming sales promotions prior to making them public. Offer some special deals now and then, for current customers only. Keep their pricing competitive with the marketplace.

If you’re introducing a new product, invite your current customers to come experience it. If they are currently using your products or services, they are your best market for any new products and can provide valuable feedback. That’s what I call a win-win.

You can also engage with your customers on social media. If a customer’s business is having a promotion, post it on your Facebook page or retweet it to your business’ followers as a way to offer them additional support.

It’s all about regular communication and making your current customers feel valued. Let them know you appreciate their business.

There’s an old Texas saying, popular with the late famed University of Texas football coach Darrell Royal: “Dance with the one that brung you.” Support those who are supporting you: your current customers.

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