Grow your business

Customers are at the heart of every successful business - and maintaining and growing a customer base is the key challenge for all small business owners. Find out how to understand who your customers are, which products they are buying, and how to increase sales.

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  • How to improve customer loyalty

    Studies have shown that it costs five times as much to find a new customer than it does to keep an existing one. Finding new customers requires spending for advertising, promotions, website maintenance and social media. So understanding what your existing customers want and delivering it to them effectively is the best way to retain customers and grow your business. Tools available to help retain customers include loyalty schemes, customer data capture, sales incentives and seeking feedback from customers - both good and bad.

    Customer loyalty schemes

    Daniel Smith, from cross-channel marketing provider ClickSquare says "A businesses motivation for offering a loyalty card is to create a mechanism to link the customer's identity to the content of the market basket.

    Every customer purchase is stored in a database which the business can mine to understand the individual customer's purchase preferences and behaviours. Do they prefer specific brand names or do they seek only sale items? How frequently do they shop? On which days? At what times? What's the typical spend? Do they use coupons? Redeem their loyalty points? Armed with this information a business can look at sales per individual to see who's profitable and who isn't and then devise marketing programs to engender loyalty and encourage increased/more profitable spending."

    Loyalty schemes - everyone's a winner!

    While there are benefits to the business, there can also be benefits to customers if the loyalty scheme is structured correctly. Daniel continues "The loyalty card is the only way in which customer intimacy can be achieved on a massive scale. Instead of flyer advertising a limited number of weekly specials, businesses can now craft emails (or print offers on the back of the till receipt) specially customised to a customer's buying habits. The key is to make offers appropriate so that the customer perceives these highly relevant, well-timed, personalised marketing messages - not as an annoyance, but as a value-added service."

    Make your customers feel special

    UK GCVA, the trade body for the gift card and loyalty industry, says that an essential part of customer relationships is being made to feel "special". Andrew Johnson, director general for UK GCVA, says: "The best type of loyalty scheme is about personal recognition, how special do you feel if you turn up at your favourite restaurant and the manager shakes your hand and welcomes you by name? You want to be made to feel special and have access to something others don’t have.

    "Small businesses should think about additional value they can offer to make regular customers feel special. There doesn't need to be a complicated points collection scheme," he says. For example a party a couple of times a year to which regular customers are invited or a 'thank you for your business' email or card are some simple things that make customers feel special.

    "If you need something more formal then a simple stamp and card type system works well - many large coffee chains still operate this very basic system. If you have an integrated EPOS, then a system that recognises a customer order is great, or if you're interacting with 'the public' then some way of being able to 'look-up' customers is key. This means you can reward customers without them needing to carry a card."

    Customer loyalty & data protection

    Provided customers have 'opted in' you're fine. Andrew says "You will need customers’ details to be able to contact them and as long as they give you permission you will have no problems. Don't contact them too often as they will get bored of your communications. You'll also need to ensure they have the option to 'opt out' at any point."

    In today's market, keeping customers loyal has never been so important he says. "Your competitors will be constantly marketing to your customers to steal your market share. Recognition and making the customer feel special are really key."

    Managing complaints

    Effective complaint management is also essential when building customer relationships. Charter UK works with companies to help handle complaints efficiently. CEO Paul Clark says: "Everyone dealing with complaints, from the call centres to the branches and online support teams, will need to be prepared and as highly trained as possible. A single, integrated complaint handling system makes it much easier to have a single view of the customer - and the entire customer interaction - from start to finish.

    "Automation can make this entire process even easier and much more cost effective, without any negative impact on the consumer. Hiring more staff to deal with customer service is expensive and the time required for training is typically very time consuming. The right technology, however, can help to streamline and automate key customer services process and therefore help to cut down response times. In a web-enabled world consumers expect a prompt (if not immediate) response to their query or complaint and businesses can now use a combination of automation and the correct processes to achieve this goal."

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