A customer retention plan is a necessity in order to develop and maintain great relationships with existing customers. Sales representatives are usually occupied gaining new leads and capturing more sales, and their current customer base is left neglected. There are seven main benefits to having an effective retention plan in place that will help prevent that situation from occurring.
1. Keep your Current Customer Base. Nobody wants to lose an existing customer, especially if the reason is because they feel neglected or they forget your company even exists. It is important to keep in contact with all of your existing customers who you have done business with in the past year. The size of the company is irrelevant because you can never predict the future. A small customer today can grow and become a large and more valued customer tomorrow. The ability to maintain constructive relationships and retain your existing customer base is also important in the slower months of your business and can prove to be very beneficial in a slumping economy.
2. Maintain Customer Information. The retention plan will ensure that current records of all of your customers are accurate. You will always have updated email addresses, phone numbers, and other personal information that will be shared over time. Examples of personal information that is worthwhile to record are interests such as hobbies, spouses’ interests or likes, amount of children and their hobbies, and other information that you believe will help build your relationship.
3. Build Sales Through Referrals. By maintaining constructive relationships with your existing customer base, many referral sales opportunities arise. If you are in the maintenance service industry, many facility managers meet on a regular basis and share best service practices. It is not uncommon for the managers to discuss good and bad service providers and the areas that the bad providers need to be replaced. This is the perfect time for a manager who you have a constructive relationship with extends an invitation or recommends their best service provider.
4. Become a Consultant/Adviser. By keeping in contact with your customers and by providing an excellent service you will improve your customer relationship and be viewed as more than a service provider. A trusted service provider is known by their customers as an advisor or consultant. You will receive phone calls from customers asking you to re-write specs or for advice on how they should make decisions. You have reached the pinnacle of a customer relationship once this step takes place.
5. Improve Communication. A retention plan will open all of the lines of communication. On the service provider’s side it makes it easier to approach a slower paying customer or to work out a troubled invoice. It also makes the customer feel more comfortable to reach out to you with any problems that may need to be addressed before they reach the point of annoyance or possible loss of a sale. Open lines of communication promote honesty, candor, and overall good working conditions.
6. Become a Leader in the Industry. Forming constructive relationships with your customer base will allow for opportunities that set yourself and your customer apart from all competition. Regular discussions on industry practices or the ability to share ideas can lead to industry firsts or new ideas that prove to be beneficial to both parties. When sharing and discussing ideas from both angles; the customer’s and the service provider’s points of view, it can lead to very positive results.
7. Create a Positive Work Environment. Creating relationships that improve communication will allow for a more positive work environment for all office personnel and staff. Customers that call will not automatically feel the need to take the defensive approach. Positive and frequent communication will promote an atmosphere that will eliminate accusations of poor performance and will have an overall positive impact not only on your organization, but on the customer as well. All will enjoy a positive, less stressful environment which creates a happy, loyal, and healthy work environment.
A retention plan can improve your business tremendously as well as build healthy and happy relationships with your current and future customer base. Happy customers will lead to referral sales, the sharing of best business practices, help create loyal employees, and create an overall enjoyable and productive office environment.
