Tips for Building Strong Customer Relationships
Customer acquisition (getting new customers) and customer retention (keeping existing customers) are critical for long-term business success. Evidence shows that the cost of getting a new customer can be up to four times that of retaining an existing customer. This makes relationship building in business, which has been shown to boost customer retention, extremely important.
Not only is it relatively cheaper to retain existing customers than to get new ones, existing customers can also be more profitable than new ones. Research shows that even a 5 percent increase in customer retention can boost a brand’s profits by 25 percent to 95 percent.
The difference in the cost of customer acquisition and that of customer retention may be due to trust. Customers tend to buy from brands they trust.
This trust may be the key to building long-lasting customer relationships. Customers need to trust you and your ability to solve their problems. To position yourself or your brand as trustworthy, start by understanding what your customers value.
To find out what your customers value, listen to them. Listen to what they say and how they say it, because some customers will not spell out the benefits they really care about. It’s by listening and watching for subtle cues that you can uncover what your customers truly need most.
People buy from human beings. Even where a big brand is involved, customers prefer to deal with real people, not a faceless brand. This means you should show them you genuinely care by connecting with them beyond the professional level.
To show your customers that you care, find out what they care about. One customer will be passionate about their family, another about business. Engage with them on that subject of interest.
If it’s a business problem that’s keeping them up at night, empathize with them before you sell them on your solution. If it’s their child’s birthday, or they’re celebrating an anniversary, wish them well, and send them a gift or an exclusive special offer.
Understanding who your customer is and what they care about helps to personalize customer relationships. Even customers with a similar problem have their own ideas for how they’d like it solved. You may be offering just one service, but how you sell it to each customer matters. Understanding your customers on a deeper level also allows you to match your messaging and tone to their personality. This shows them you “get them.”
Customers invest their time and money where they get value. As such, creating value for customers is what will keep them. A proven way to create value is to build a solution that works. If you promise a customer a particular result, be sure to deliver it. You’ll come off as a dependable and trustworthy person.
Strong customer relationships drive businesses. They improve customer loyalty by reducing customer churn (customers stopping buying from a brand). They also increase customer lifetime value, meaning the longer they stay with you the more revenue they will bring to your business. What’s more, happy customers will refer others to you, keeping your sales pipeline healthy with free promotion.
The key to building bankable customer relationships is to treat each customer as an individual and then provide value. Positioning yourself as the linchpin, the go-to person for all their needs, boosts customer retention. Building strong relationships takes time, though. Customers understand this, too — they’re unlikely to drop off and start a new relationship with another brand all over again if they’re getting value from working with you.
