How to look after your best customers

I have just signed a new mobile phone contract with my existing supplier that gives me a lesser package at a higher price than I could have got from a competitor. Fact is, I accepted a plan that will cost me almost 40% more and has fewer benefits; so how did they persuade me to part with my cash and why was I happy to do so?

In simple terms the downside of moving my contract to a new supplier outweighed the benefits they were offering.

Here are some of the reasons I stayed:

  • inertia (well I’m only human!): I was looking for reasons to stay with my existing supplier as I didn’t really want the hassle of changing. This meant that I was receptive when they offered me an incentive to stay. As it turned out, it didn’t even need to be a particularly great offer to retain my business
  • good service: I have always had good (though not outstanding) service from my existing supplier
  • value added offers: My existing supplier has sent regular offers and incentives over the years, which have continued to remind me that I am a valued customer
  • brand familiarity:  I don’t consider myself to be a particularly brand loyal person, but having trusted in this brand for some 10 years, I certainly feel I know what I’m getting.

In contrast, I did decide  to move my broadband contract a few months ago. In this case I felt that my existing supplier offered a mediocre service at a high rate and made absolutely no effort to add value or to retain me as a customer!

While this example relates to a highly competitive market dominated by big organisations, the messages translate to small, medium and even micro businesses. Whilst I certainly wouldn’t advocate building a customer retention model based on the premise that your customers can’t really be bothered to move to a new supplier, your aim should be to ensure that they don’t want to move. If your existing clients are happy with you, you will have a fighting chance of keeping them regardless of what tactics your competitors are using to try to poach them.

Existing customers are a really valuable asset to your business so make sure you are looking after them well.

Image: http://www.freedigitalphotos.net

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s