It's so much cheaper to keep a customer than to find a new one, that for a small business it's perhaps the most vital ingredient for a healthy future.
So how do you keep customers? Price is the most important factor for many shoppers and some businesses trade exclusively on that. But there are two problems with this as a long-term strategy: firstly, most customers don't decide where to buy on price alone; and secondly, those that do will eventually be worn down by an apparent lack of care by the seller.
Excellent customer service is the foundation stone on which to grow your online business. In this day and age, when so many companies give poor (or simply neglectful) service, it's also a fantastic way to stand out from the crowd.
It's not a short-term strategy; it should be a permanent, long-term mission statement. Being friendly, efficient and above all helpful may not immediately get you more sales, but it will help to persuade customers to return and it will encourage them to recommend your business to friends and family.
I'd like to re-emphasise the word helpful. Go out of your way to help your customers. Distinguish yourself from companies with robotic staff who parrot the usual line, not intending, or caring whether they really help. Actually solve problems, don't just sympathise; offer real solutions, not just a goodwill gesture.
Above all, contact your customers to check if they're happy. That’s what the restaurant trade calls the “two minute check-back”, and it works brilliantly when the waiting staff are properly trained – it allows them to check that everything is okay with the customer's meal and experience, but it's also a great opportunity to offer more drinks and get more sales.
Whatever you do, don't hide behind your website. You may not have that bricks and mortar store, but it's no excuse for zero interaction. Publish your phone number clearly; interact with customers through email and social media; contact them frequently for that “two minute check-back”.
The customer may not always be right, but they are always the king, and if you invest the time and effort to treat them like royalty then you'll be creating the conditions for a long-term, thriving businesses.
Copyright © 2014 Simon Michels is a director of Photo Productions.
There was a time when businesses could get away with hiding from their customers, particularly when they knew they had done something wrong. Those days are long gone.
Good customer service is more critical than ever and businesses that want to survive and thrive must value their customers and build good relationships with them.
In fact, there are simple ways that small businesses with tight budgets can improve their customer service. Here are some findings from Expert Market UK’s recent customer service study, which found that:
The biggest damage occurs when potential customers don’t get the information they need when they first enquire (57%). The other danger point is when a customer has made a complaint but is not satisfied the response (26%).
Phones and email are still the preferred channels in the UK and respondents polled said businesses should focus on increasing their customer service staff (36%), providing contact details (24%) and making sure staff are aware of current policies and promotions (20%).
In fact, complaints can often be turned into wins for small businesses. Always contact customers promptly, using their preferred method. At the same time, make it easy for customers to reach you by displaying contact information clearly.
Victoria Elizabeth is digital asset executive at Expert Market UK.
If you know what you’re doing, social media can be an easy and cost-effective way to improve your customer service, especially for small firms. As your company grows, you need to make sure that you are also developing a loyal customer base. The great thing about social media is that a satisfied customer will recommend your products and services to their family and friends.
If you are unsure how to approach social media, take a look at your competitors to get an idea of how other businesses do it. Then aim to do it better. Here are five tips to help you improve your social media customer service:
The best way to ensure your customer service remains consistent throughout your company and social media platforms is by developing clear company values and social media policies. Ensure your employees are properly trained and that they have the ability to deal with issues as they arise. This way you can guarantee your online presence is consistent.
By maintaining active social media profiles, you will have a platform on which to connect and interact with your customers. Be a person, not a faceless brand. Your customers want to talk to real people — and this is often where small businesses have the edge over bigger competitors. By really engaging with your customers you can get a better understanding of the people who use your products. Use this to provide a personalised service that will exceed your customers' expectations.
If you receive a complaint, make sure that it is dealt with quickly and professionally. When dealing with the customer, be polite. It is important that you genuinely and openly apologise for the error. After this is done, move the conversation to a private message or email. The best way to exceed expectations is to reach a mutual resolution, but provide more than what the customer was expecting. This is your opportunity to turn a customer’s negative experience into a positive one.
Complaints are not only a chance to showcase your customer service skills; they are also an opportunity to learn and develop your products and services. You should encourage your customers to give feedback and take on board any suggestions that they have to offer. You can use this feedback to provide your customers with a product or service that is tailored to their requirements.
Give advice and share your expertise and experience. Produce interesting and useful content that you can use for your company’s blog. If you do start a blog, make sure that you update it consistently and frequently. Your posts can then be promoted on your social media channels and used to kick-start meaningful conversations.
Sara Parker runs the social media for Face for Business.
When I run sales workshops, I always test the temperature of the audience by asking them about their favourite customer; not necessarily the biggest one, but one that they like on a personal level.
This is to help me to get a feel for their business, how they deliver their products and services, and to look at how to replicate their best practices, based on successful customer case studies.
Occasionally some members of the audience look at me blankly and further probing reveals that they actually dislike all of their customers: difficult people, who always seem to be complaining and constantly looking for lower prices.
At this point I feel they are more in need of personal counselling than sales coaching, but do my best to rectify what must be a terrible situation for someone in a small business. In a large organisation you can at least look forward to the pay cheque at the end of the month, whereas in a small organisation, the buck stops with you. There is one consolation: in a small company, you are actually allowed to make some mistakes, so long as you rectify them swiftly.
This was an interesting observation made by Richard Richardson, who has seen both sides of the coin. He had a very successful career in advertising, most latterly with Young and Rubicam. His favourite customer was John Barnes at Kentucky Fried Chicken, and they used to spend many hours cooking up new business ideas, just for fun.
But one idea seemed to have some traction: what about the original British fast food — fish and chips? The best-known name, Harry Ramsden's, was a single large restaurant at Guiseley in Yorkshire, with a few other outlets, differently branded. The owners were looking to sell and Barnes and Richardson saw the opportunity to build a great brand, something they were both passionate about.
They had very complementary skills; Barnes the charismatic ideas man, Richardson the completer/finisher. They shared common values, particularly a love of customers and customer interaction.
They raised some money and then set about building the Harry Ramsden's brand, but without the large marketing budgets they were both used to. They developed a style that they later captured in their book, Marketing Judo — the idea that you use the opponent's weight to your advantage, using leverage, rather than brute force.
They kept the team lean but instilled a sense of customer awareness by insisting that everyone in the 25-person head office called at least five unhappy customers every week.
This caused some bemusement amongst their customers, particularly a gentleman in Bournemouth who had filled in a card to complain about some cold chips at their Bournemouth outlet.
He was so surprised to hear from a director of Harry Ramsden's that he dropped his mobile phone, and then explained that he had just bought a car for £35,000 and had less joy in having problems resolved than for this 70 pence bag of chips. Richardson's simple phone call also generated significant new income as the gentleman's wife resolved to take parties of visiting Chinese business people to Harry Ramsden's.
But Richardson explains that in a small business it is fine to make mistakes, so long as you resolve issues swiftly and personally. He feels that many large companies seem to have an ethos of never admitting failure, which can be disastrous, as customer expectations are increasing all the time.
Once the brand had become established, they decided to grow their business by a franchise model, as it meant that ownership of the brand was closer to the customers; a proven concept delivered by local people. But while the brand can be promoted generally by head office, it is still down to the local entrepreneurs to do what they can, often without much of a marketing budget.
In Marketing Judo, Barnes and Richardson have many tips for doing just this, including extending your offer in interesting ways (the Glasgow branch offered haggis) and providing complementary additional services (arranging coach trips for senior citizens to show off interesting local buildings after a fish supper). They refer to this as “getting the crowd on your side”, using emotional leverage rather than just marketing muscle.
If you do this, not only will you grow to love your customers, you will find they will love you right back, and do your marketing for you, by word of mouth.
Copyright ©Mike Southon 2012. All rights reserved. Not to be reproduced without permission in writing. Mike Southon is the co-author of The Beermat Entrepreneur and a business speaker.
Many businesses have rigidly defined the respective roles and responsibilities of their customer service and marketing departments. This is often the source of frustrations as, on one hand, the marketing guys do not have the opportunity to interact with the customers and, on the other hand, the customer service team has only a limited opportunity to influence product design and communication.
Small businesses have much more room for manoeuvre, as they can chop and change, test and experiment without affecting a large volume of customers. Very frequently, small companies manage their customers through a single channel, handling social interactions, marketing efforts, customer service and many other activities in one place. They use mishaps as a marketing opportunity and dispatch little gifts and samples to “compensate” customers. Customer service is clearly being used as a marketing tool.
Whilst larger operators are busy leveraging their social media reach by pushing multitudes of promotions, special offers, coupons, vouchers and deals, small businesses can build a long-term advantage by establishing close-knit communities of customers. Positioning customer service at the heart of the marketing strategy contributes to the exchange of ideas and the resolution of problems whilst creating a platform for future recommendations.
All this contributes to the development of a very strong sense of loyalty.
The challenge comes when the business grows and someone makes the suggestion that life would be much easier if dedicated marketing and customer service teams were established…it will be hard but just make sure you resist the temptation.
Guest blog by Very Good Service.
Read more in our dedicated section about customer service.
I have been thinking about the brands we love and how to improve customer retention. Let me tell you a couple of stories.
Three years ago, I took delivery of a car and on the way home it literally died. I did not see the car again for four months. However, the gentleman who looked after my “case” was exceptional. He updated me regularly, kept me totally informed on progress and made a bad situation OK. The car firm also sent me a range of well thought-out sorry gifts that were actually appropriate and of suitable value. I am now very loyal to this brand and I have a good opinion of them.
The other day, my wife and I were chatting about Clark Plc expenditure. We had decided to tighten the belt in a few areas and Sky TV was first on the list. With three kids of different ages, all of us have different viewing requirements ranging from football, Disney and South Park to Grey’s Anatomy. We currently have the full Sky package. It was going to be challenging to cut back.
In fact, my wife had a very, very good experience with Sky TV. The man on the phone listened and came up with a superb idea that was appropriate to the situation and our request. It was surprising and well delivered. To be frank I think we were expecting a bit of a challenge. It was the opposite. So now I have a great opinion of Sky, Clark Plc has the viewing requirements sorted and I will tell people about the positive experience.
So this got me thinking about two things: why we become loyal to certain brands and how businesses can improve customer retention.
In order to establish a loyalty scheme of any kind we need to establish who it is we actually want to reward and what it is we want to reward them for. If our most valuable customers are 100 per cent loyal to us then do we give them rewards just for being there, or do we concentrate on making the less valuable customers more valuable? We must ensure that we are adding value to our business and not simply creating a discount scheme.
Defining our objectives needs to be the first step – are we looking to reward behaviours that are good for our business, such as a customer spending more within a certain time frame, for instance?
We then need to understand our audience segments. Customers are all different and treating them as one entity means that we may be missing the main motivational factors for some of them.
After we have segmented the audience we need to look at who is the most valuable to us and why – is it the segment that makes up the highest proportion of our base? Those who spend the most? Those who are the least hassle? Or those who we feel we might be in danger of losing soon? How do these customers stack up against our objectives?
Having understood who our customers are, we need to understand their motivations – this allows us to be relevant. What do they value most?
We are a business, so we also need to understand our own motivations – what would we like our customers to do? Spend more? Stay with us long-term? Again, we need to look at this against our objectives.
Adding all this up we can see who we should be targeting, what we want to encourage them to do and what is going to motivate them. Our aim is to identify positive behaviours we want to reward and habits we can seek to change in order to make our business more profitable.
In an environment where winning new customers will get harder, it is more vital then ever before that we cherish our current customers. Some are happy, some are apathetic and some may be disappointed. As spring approaches it would be wise to look over your customer base and reward them, tackling any issues with empathy and understanding. We do long for loyalty from them; let’s give them some reasons to love us and importantly to tell their friends and associates about the great experience they have had with you.