Why businesses succeed (part 1): they build a loyal customer base

Spending money to bring new customers in the front door while existing customers leave through the back door is not a strategy for success.

Some businesses have the focus and do the work needed to hold on to existing customers. Here are some of the things they do:


Start with the basics. Deliver a superior product or service, and provide great customer support after the sale. Give customers a reason to say good things about you.

Emphasize customer experience. How do customers feel when they do business with you? Do customer satisfaction surveys with every customer. How do they use your product or service? How can you do a better job meeting their needs? And contact the customers who leave. If you don’t know why they left, it’s hard to fix the problem.

Do something extra for long-term customers, active customers, and customers who recommend your business to others. Make them feel like insiders. Include them in your decisions. Encourage them to give good reviews and share their success stories.

If your business depends on a relatively small number of customers, use a customer relationship management (CRM) system to keep track of their purchases and your communication with them. (For more on this, check out the Ritz-Carlton Hotel and the Ritz-Carlton Leadership Center).

Put likeable and competent people in customer contact positions. The people who have the most impact on whether customers stay is the ones who deal directly with customers. Hire for friendliness, provide lots of training, and eliminate the policies that keep front-line people from satisfying the customer.

Communicate, communicate, communicate. Keep in touch with your customers. Remember, ‘out of sight, out of mind’. Thank them for their business. Give them information that is useful to them, not sales pitches. If your customers are other businesses, help them succeed. Talk about ways you can apply your products or services to overcome their business challenges. Look for ways to find customers for them. If your customers are consumers, help them make their lives better. And don’t do everything on-line. Meet customers in person. If it makes sense, set up customer events. In a perfect world, your customer events will turn into the equivalent of the Harley Owners Group.

Avoid attracting ‘bad’ customers. A bad customer is one whose needs are a bad match for your product or service, who buy only on price, and don’t see value in what the company offers. They often generate more than their share of complaints, taking up employee time that could be used to satisfy ‘good’ customers. Make sure that all of your external communications appeal to customers who you can satisfy, and the sales process lets ‘bad’ customers drop out voluntarily.

SCORE counselors are available locally or on-line to help you create and manage a successful business. Call us in Pinellas County at (727) 532-6800 or go to www.pinellascounty.score.org.

Photo courtesy of James Morrison via creative commons license