Saturday, April 15, 2006

Five ways to get your current customers to recommend you to their friends

How to Generate Record Profits from
Customers You Already Have

Many small business owners fail to take advantage of their most important asset, their customer list. Most of the small business owners I meet are constantly searching for ways to expand their customer base when it’s been proven time and time again that you can make more money from your present clients than constantly looking for new business. So, I devised some secrets to begin the process of retaining good customers and generating greater profits from them.

Get to Know Your Customers

Small Businesses today are finding that in order to survive super discount competitors and huge company advertising blitzes, they must go back to the relationship building of the good old days. In cities and towns of yesteryear, the shopkeeper knew his customers by name and the type of merchandise they needed and made certain he had it in stock. This kind of relationship coupled with personalized customer service and a genuine empathy with customers, is what keeps them coming back to you instead of going to your competitors.

Gather Customer Information

A database of customers is the most valuable asset your business has. Yet only 10% of the retailers in the United States keep a current list of their customers! Statistics show that businesses spend five times as much for new customers than they do on their present customers, yet a regular customer is worth 10 times the cost of acquiring a new customer!

Today, however, a mailing list is not enough. To build relationships with customers that commands loyalty, you must gather information, which is valuable to you. For example, age and even ages of relatives, size of home, color and style preferences, date of last purchase, amount of purchase, brand preferences, important dates including birthdays, anniversaries.

Serve the Customer

Waiting on customers courteously is just the beginning of good customer service. First, find out what the customer expects from you. Make sure your salespeople praise every customer, show an interest, and establish rapport. Get in the habit of corresponding with your customers. Send them notes, cards, articles, and clippings that interest them. Send them thank you notes and cards telling them about private specials and trunk showings. Mail out a newsletter explaining what's new in your company.

Reward the Customer

A study by the Rockefeller Foundation found that a whopping 68% of customers stop buying from you because of an attitude of indifference toward the customer by the owner, manager, or employee. In other words, if you ignore customers, 7 out of 10 will not shop with you again, for no special reason.

By segmenting customers into groups, you can treat customers individually, based on their buying habits and the information you've gathered. New customers need to know that you value them as a new customer and that you actually care if they shop with you again. Send them a thank you note after their first purchase.

Use What You Know to Get New Customers

Once you've built a list of customers, their preferences, demographics and transactional data, you'll be able to use this important information to find new customers with similar characteristics. Start a Referral program by rewarding customers who refer their friends and relatives. Obtain a list of new movers to your area with similar age and income parameters to your present customers. Use testimonials from satisfied customers to attract new customers by mail. Obtain a mailing list of targeted prospects that match your customer profile.

Tell a Friend

You now have the customers on your side; you now need to have a program for them to refer your products to your friends. When you have done that, aided with good products, you should be able to boost your site's traffic and have good sales. Refer-a-friend codes are available to help you put a plug-in to your website.

You should also offer incentives to your current customers to tell their friends and business associates about your site in any way that is appropriate to the content and purpose of your site. You may need to try several different incentives before you find one that works.

An inexpensive, yet effective incentive is to give them more chances to win a contest you are running for every friend they refer to your site. Another is to give them some kind of priority access to your services. It might be something as simple as offering a 10% coupon on products they purchase from your site after they have sent a few new customers.

About the author:

Peter Dobler is a 20+ year veteran in the IT business. He is an active Real Estate Investor and a successful Internet business owner. Collect more free software and bonus content for your own web site at http://www.online-business-idea.com

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