Keeping a Customer is Just as Important as Getting a New One

One of the biggest mistakes service-based companies make is believing that great service alone will keep a customer. "People often think that giving good service is all that's required, but that's a fallacy," says Bob Johnson, executive director of the National Association for Information Destruction, an international association for service-based companies that provide information destruction services.

"Certainly, not having good service may lose an account," Johnson continues. "But having good service alone will not keep an account. Clients need to understand why you're providing the best value. They need to know why they're using your service. In other words, you need to after-market to them so they will understand what you do to meet their special requirements."

It's often said that customers need to be sold three times: before the sale, immediately after the sale and on an ongoing basis (after-marketing). After-marketing should be thought of as an unending process that continually keeps your company's name fresh in your customers' minds and continually reinforces the reasons they chose to do business with you.

Relations with customers are never a static, one-time event. Customers' needs continually change and evolve, and as a provider, your company needs to adapt to meet these changes. But after-marketing goes beyond this. It involves pointing out to customers exactly how you're adapting to meet their needs. In a competitive market, providing great service is only half the battle. Your competitors will bombard your best customers with reasons they should drop your company and start doing business with them. These reasons may involve lower cost for comparable service, a wider array of services for the same cost or the use of newer technologies that can take care of needs your company may not even be addressing.

"No matter how low your price, a competitor can come in with an even lower price or can offer more services for the same price," Johnson points out. "If you secured customers based on low costs, you need to continually remind them that you provide value. If you don't, it's likely that a competitor, even one who charges more than you do, could challenge your relationship with a customer by saying that they provide significantly greater value. Cost is not everything to customers. They want their needs taken care of, and often they're willing to pay a bit more if they feel someone else can provide better service."

It's your job to keep customers informed about what you offer, how you are meeting their specific needs and why you are providing a greater value than competitors. If you fail in any of these, you run the risk of losing a customer to competitors.

How then should you keep customers informed? The following list offers proven ways to communicate regularly:

1. E-mail updates. These include e-mail newsletters and bulletins that describe your services, as well as the latest news in your industry. The focus always should be on providing solutions at cost-effective rates — in other words, how your company provides value.

2. Hardcopy newsletters. These are similar to e-mail updates and newsletters. Usually, they require more, higher-quality graphics to look professional and attractive. And, of course, printing costs will be involved. If you're willing to undergo the expense, hardcopy newsletters are likely to be more widely read among your customers than e-mail newsletters.

3. Personal letters to decision makers. Writing an occasional letter directly to your key contact(s) at a company can keep lines of communication open. These are more personal than e-mail updates and require more time on your part. Without addressing specific needs of the customer you're contacting, a letter can come off as appearing superficial.

4. Phone calls by managers or sales personnel. These are most effective when used to determine new needs the customer may have. You can then address these needs, and as always, point out the value you provide.

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5. Personal visits. These require more time, but can be worthwhile when targeting larger, more important customers. Always make an appointment, and don't even bother setting up a meeting unless you're willing to spend the time required to analyze the individual customer's needs and show how you're meeting them. The main gist of the meeting should be to get updated customer information so you can continue providing complete solutions.

This article originally appeared on the Web site for the National Federation of Independent Business, www.nfib.org.