Keeping loyal customers is important
Today's economy and business markets are competitive and challenging and retaining customer base is important to a business.
Glenn Muske, Oklahoma State University Cooperative Extension interim associate dean, assistant director, family and consumer sciences, said going the extra mile to keep customers is especially important for small businesses.
"Small companies usually don't have the marketing and sales budgets to lose customers and quickly gain new ones," Muske said. "It makes sense to take care of your regular customers, especially the magical 20 percent who do 80 percent of the business for a firm on average. But you want to also pamper the other 80 percent. Existing customers are the key to your marketing by being the voice of your company."
Word-of-mouth is often considered one of the most effective forms of promotion, so it is important to maintain a positive relationship with those people already doing business with you.
Muske said maintenance is a low-cost method of marketing. On average it only costs $1 to $3 to maintain a customer, but $15 to $20 to gain a new customer.
Not only is it less expensive to retain existing customers, most surveys across industries show that keeping one existing customer is five to seven times more profitable than attracting new ones.
To solidify customer retention, focus on building trust and listening to customers. This leaves them with a positive attitude and impression of your company.
"Keeping customers is as important as gaining new ones," Muske said. "Each customer's positive view of your company can lead you to be more profitable and successful. Not only does that customer continue to add to your bottom line but that customer base can be used to bring in more new customers. This makes customer maintenance a win-win situation for the business owner."