The first step to customer retention is knowing what your customers' needs are, and then delivering on them. The more information you have about your customers, the more effective and targeted your marketing can be. It's important to remember you should never harass the customer; the best data retention schemes are unintrusive or incentivised.
How to collect data?
If you run a survey on your business, you can obtain a fair amount of information by asking details about a customer's profile (gender, age, etc). While some respondents may be reluctant to give their name, some will. For those that don't, you get a clearer picture of your overall target customer anyway.
If you run a competition, you can gather email addresses that can be used for future mail-outs. Customers are more willing to share personal data when they have something to gain from it.
If your business is online you can track spending habits and user preferences of your customer, though you may only be able to get an overall picture of your target customer rather than profiles of specific users. Use Google Analytics to uncover the most popular parts of your site and the least popular, and then change your outlook accordingly.
How to store data
If you hold customers' personal information, you need to be aware of the Data Protection Act - its eight principles must be adhered to. To make sure you don't accidentally break the law, read our guide on the Data Protection Act.
Once you've built up customer data, you're ready to start building a relationship.
The most important rule when contacting customers is to make sure your email, letter, brochure, tweet or Facebook message is unintrusive. Only contact customers when you have something relevant and worthwhile to say. Don't just bombard them with every product or offer you have. Tailor your marketing message to meet the needs of your customers.
When you reach out to customers, you should make sure your marketing material reflects your business in the best way. Make sure your leaflets, brochures or postcards are well designed and well printed (try these). A well-designed postcard could even be shared by customers with their friends and family if they pin it on the fridge door.
When contacting customers, you should give them a way of getting in touch to give you their feedback. Asking customers for their opinion makes them feel valued and helps you to retrieve even more data. It's a win for both parties.
Once you have customers' information, you can encourage them to shop with you again by making them feel special. Offer customer-only competitions or reward cards. Learn from the most successful businesses in the UK - Tesco Clubcard, anyone? Another example of a business doing this to the max is printed.com. The online printing company offers its customers points to redeem against over 30,000 business and personal rewards, including free direct marketing.
Another tactic to help jetpack your growth skywards is to offer your customers discounts for their family and friends. Making it a family affair helps your customers feel wanted. Plus there's no better endorsement than one that comes from a person whose opinion your potential customer trusts.
If you've managed to collect data successfully, then you should have important stats, such as when your customers' birthdays are. This screams opportunity. Send them a birthday offer, small gift, or just a card. You can't do it for all of your customers but make an effort to do it with your best customers. It's another way of making them feel that little bit more special, and can go a long way towards creating a hugely loyal customer.
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To read our first customer retention blog, click here