It’s an overly cited, but nevertheless true statistic: Attracting a new customer costs five times more than it does to retain an existing one.
No matter your industry, you can fritter away a fair amount of your marketing budget, resources, and time trying to win over new customers. But here’s the good news: by adjusting your marketing strategy to focus on nurturing relationships with your existing customers, you can actually attract new customers through your efforts — in addition to reaping other rewards like brand loyalty, happy customers and increased sales.
(Related: How to Build Your Online Reputation)
Below, we’ve outlined four strategies to grow your consumer base by establishing meaningful relationships with existing customers:
1. Go above and beyond.
As the time-honored adage goes, you should always under-promise and over-deliver. Exceed customer expectations by delivering products with speed, convenience, knowledgeable help, and friendly service — these are the most important elements of positive customer experience, according to 80% of American consumers who participated in a PricewaterhouseCoopers customer experience survey.
When you provide your customers with an exceptional experience, they are likely to buy more, remain loyal to your brand, and share their experience with others. By delivering great customer experiences, you can encourage your consumers to leave five-star reviews and make glowing referrals while preventing the negative experiences that typically lead to bad reviews. Which leads us to our next point…
2. Invite and respond to feedback.
In our digital world, online reviews matter more than ever. Because most purchases start online these days, consumers increasingly turn to reviews to evaluate products and make a buying decision. Today, consumers rely upon online reviews as one the most trustworthy and credible sources of “advertising” — meaning existing customers can be some of your company’s best marketers. Research has shown that reviews influence consumers across all industries, with 90% of people telling a Zendesk survey team that positive reviews drove their decision to make a purchase. To share some perspective from our experience at True Blue Life Insurance: we’ve found that earning a single five-star customer review on a third-party website like Yelp, Google, or the Better Business Bureau (BBB) can yield up to a $250 return on our investment.
To build brand credibility, attract new buyers, and ultimately boost sales, you can encourage your customers to provide feedback by sending follow-up emails at the right time — such as right after they experience or demonstrate success with your product or service or make a repeat purchase. In the message, be sure to make it easy for the recipient to leave a review by including links to the review platform(s) where you want customer feedback.
Monitor your reviews and respond promptly to ensure customers know you are listening — whether they have something negative or positive to say. Responding to negative reviews empowers your company, giving you an opportunity to show your brand voice, find a resolution to the concern, and deliver excellent customer service.
3. Deliver great customer service.
This brings us to another important piece of connecting with consumers and growing your business: delivering outstanding customer service. 52% of customers who participated in the Zendesk survey report having made a future purchase after positive customer service experience, while one-third of consumers who participated in an American Express survey said they would consider leaving a company after a single instance of poor customer service. And customer service doesn’t just affect whether your existing customers stay or go — it can also help or hinder your business growth. American Express research has found that the average American tells 15 people when they’ve experienced bad customer service. On the other hand, 77% of HubSpot consumer survey participants reported sharing a positive customer service experience with others in the past year.
Customer service is your source of direct communication with your audiences, helping influence their decisions and persuading them to choose you over your competitors. Make customer support a priority by training your team on how to communicate with customers quickly and effectively. Respond to customer concerns and questions expressed via emails, chats, and phone calls as well as social media and review sites in a timely, clear and concise manner. Measure and analyze customer service metrics to find out areas of strength and improvement.
4. Make your customers feel valued.
Customers who feel appreciated are more likely to remain loyal to your brand. And as an added bonus, faithful customers can help you reach new audiences by sharing your product with their friends and families.
You can express your appreciation to loyal clientele with a rewards program with exclusive perks and discounts. Say thank you by sending a birthday message or coupon on customer birthdays, anniversaries and other holidays. At True Blue Life Insurance, we’ve found that sending out inexpensive branded items — like pens or portable chargers — can be a simple but powerful way to show your gratitude while remaining on the forefront of your customers’ minds.
Ultimately, there are two approaches to growing your business: acquiring new customers and building loyalty among existing customers to encourage them to spend more. To grow your customer base, it’s important not to prioritize new customers at the expense of your existing ones. Making an effort to nurture relationships with your loyal customers will not only boost revenue and drive purchases but grow your consumer base as word of your top-notch offerings and commendable business practices spread.
Brian J. Greenberg is the founder and president of True Blue Life Insurance, a digital life insurance agency. Greenberg, who bills himself as The Salesman Who Doesn’t Sell, is a member of the Million Dollar Round Table.