This article was updated on August 5, 2021.
Tips On Building Customer Relationships
As a business owner, knowing how to get customers through the door is just one part of the equation for success. Even if a sale is made, your work isn't finished. In fact, it's just begun. Long-term customer relationships can be incredibly profitable for businesses-- loyal customers will not only patronize your business for years to come, but they'll encourage their friends and family to do so as well. Plus, it costs much less for your business to please and retain existing customers than to reach and convert new ones. Needless to say, customer retention and loyalty is what separates prosperous companies from their competitors, and it's what keeps them afloat in both good times and bad (hint: we're talking about you, COVID-19).
The Importance of Customer Relationships
It goes without saying, every business can benefit from a following of loyal customers. These customers have brand loyalty which can be built through customer interactions, positive relationship with the employees or brand, and a strong customer relations team. Loyal customers spend more at your business and will likely recommend it to family and friends. From a marketing standpoint, investing in repeat customer loyalty tends to cost less than new customer loyalty. When we talk about the customer lifetime value, the longer the customer stays with your business, the greater the value provided during their lifetime relationship. When it comes down to it, your business's success may rely on whether or not your efforts to establish real and lasting relationships with the current customer base were successful.
These following tips are just several ways that you can accomplish this organically. Whichever you choose to follow, be sure to instill a company-wide ethos of attention to consumer needs, communication, and customer service. By doing so, you'll ensure that your clients will keep coming back for more.
Tips On Building Customer Relationships
Put simply, the best ways to elevate a one-time sale to a long-term relationship all involve your business's attitude towards the customer. Here are some tangible tips you can use to further nurture and build customer relationships and ensure that they remain loyal – even when times get tough.
Find New Channels to Build Customer and Client Relationships
You should always be on the lookout for new and unique ways to reach your customer base. One channel that is especially helpful for connecting with the locals in your neighborhood is Nextdoor.
By creating a Business Page on the neighborhood hub, locals in your area can search for or recommend your business to their friends. In addition, it empowers you to:
- Establish a local presence
- Reach the customers that matter to you
- Save time and money with marketing
- Build customer and client relationships
- Post about your deals and promotions
- Feature your gift cards and take out links
By building customer relationships, you can inspire loyalty and encourage happy customers to recommend you to others. More than 67% of Nextdoor users have shared recommendations with their neighbors. Each positive recommendation you receive about your local business could open the door to many new potential customers.
Create a Corporate Philosophy of Service Over Sales
You've probably heard dozens of adages about customer relationships, the importance of service, and customer retention over the years. And there's a reason for this – successful businesses emphasize a philosophy of service over sales.
A sales-first mentality might help your bottom line in the short-term, but it won't help you over the long run. In all likelihood, it will actually drive customers away, since you're pushing your ideas upon them instead of simply meeting their desires. If customers feel as if they're just a dollar sign, you'll do little to inspire steadfast loyalty. By focusing on the customer experience and client relationship rather than immediate sales, it's easy to develop a loyal customer pool based on customer trust and a strong customer relationship.
Good customer service is far less costly than bad customer service. So, you need to instill a mentality that customer service isn't just a department, it's your entire company. But how do you do this? Tom Walter writes:
Clarify the impact that great customer service has on each employee's career. Educate staff on the value of transformational versus transactional relationships, the concept of customer loyalty, and how staff is the organization's leading brand image. Publish metrics internally that define your organization's customer service curve. Reward all staff for achieving customer service goals.
Remember that Customers' Time is Valuable
Your customer interactions and their overall experience with your brand will either make or break your relationship. This is especially true in a digital age that's been built upon the foundation of fast and advanced service. Nowadays, it's unacceptable to have customers wait for an exorbitant long time on the phone, in a line, or for a response. Although this may be unavoidable at times, especially during busy seasons or black swan events such as the current pandemic, you should take pointed measures to defuse frustrations by:
- Communicating openly and honestly with customers
- Providing an estimated wait time
- Giving them the opportunity to be called back instead of waiting for a representative
- Offering quick replies for repetitive queries
Customers will be more forgiving about wait times so long as you acknowledge the fact that they are waiting, you see them, and will get to them as soon as possible.
Utilize Social Media to Its Fullest Extent
These days, social media is one of the most powerful marketing tools at your disposal for building customer relationships, and best of all, it's free. But social media sites such as Facebook, Instagram, and Twitter aren't simply meant for promotional and advertising efforts. They are a critical way you can connect with customers and build relationships. According to Sprout Social:
Connection breeds loyalty and bottom line growth. Investing in relationships with consumers directly impacts business revenue and strengthens customer loyalty. With the introduction of the CRM tool, we're able to track information from our clients to offer a customized marketing strategy, which hopefully leads to good relationship building and a satisfied customer. When customers feel connected to brands, more than half of consumers (57%) will increase their spending with that brand and 76% will buy from them over a competitor. This shows the importance of good customer relations and a strong relationship marketing strategy.
Building customer connections via social media can help boost your company's bottom line. But what does proper social media conduct look like? Companies that do it right will:
- Listen to customer feedback
- Respond promptly and professionally
- Personalize conversations
- Utilize feedback to improve service
- Reward customers for loyalty and feedback
- Encourage user-generated content
Treat Each Customer as an Individual
Do you give customers the VIP treatment by going out of your way to make them feel remembered, valued, and cherished? If not, you're missing out on a golden opportunity to inspire loyalty and forge real relationships.
And how do you go about that? Some easy steps you can take include:
- Try to remember their name - While this may be impossible for larger brands, if you own a small business, you should make it your mission for both you and your staff to learn and then remember customers' names. Getting on a first-name basis with your existing customer base will make them feel like a regular and shows them that you see them more as a friend rather than a potential sale.
- Get to know them - If you can, go out of your way to demonstrate real interest in customers' lives. When they're in your shop, ask questions, strike up conversations, and go beyond simply selling. If you do have loyal customers, consider showing them small gestures of your appreciation for their business.
- Be friendly - Whether your interaction with a customer is positive or negative, it's important that you always maintain a cheery demeanor. Even if you don't feel like it, remember to remain positive.
- Maintain an order history - If you run a restaurant or a bar, tracking a repeat customer's order history is a nice and convenient way to save them time or demonstrate that your business is paying attention. For example, with bartenders, few things will inspire patrons to keep coming back more than remembering their go-to drink.
There are dozens of ways you can get personal with customers. The action itself isn't all that important, really. It's about demonstrating to customers that you see them, remember them, and treat them as valued individuals.
Use Loyalty Programs
One of the best ways to maintain lasting customer relationships and boost customer satisfaction is to create a loyalty program. Also known as customer relationship management, loyalty programs reward customers for their continued patronage by tracking their spending and purchases over time. A classic example of a loyalty program is the discount cards many big-box grocery stores offer to their customers. According to Business.com,
Acquiring new customers costs 5 to 10 times more than selling to a current customer - and current customers spend 67% more on average than those who are new to your business.
With that in mind, it's vital that you come up with ways to incentivize recurring revenue streams. One of the best ways you can do that is by offering customer loyalty programs that incentivize them to keep coming back for more. These might include:
- Loyalty point programs
- Birthday deals
- Gift card deals
- Referral rewards
These are a great start, but you don't have to limit yourself - you can also get creative. As Forbes writes:
There are lots of companies who are doing this well. Stitch Fix, for example, offers a $25 reward to customers who refer a friend that makes a purchase. Sephora offers benefits like free makeovers to customers that spend a minimum amount. Phone companies commonly offer money for switching providers. Most banks or credit card companies offer discounts at partner stores. All of these are great examples of ways to get customers excited about doing business with a company and give them tangible reasons to develop brand loyalty.
To do this, take time to consider your niche and then brainstorm creative ways you could reward loyal customers for their continued business. If your business serves food or drink to the busy lunch crowd, consider a punch card program where every 10th item is free. They're inexpensive, make customers feel like they're getting a bargain, and keep people coming back for more.
Reach Out Tastefully
Your goal should always be to stay on the forefront of the customer's mind. Even if your business is physically shut down or disrupted because of the coronavirus, you can devote concerted effort towards your outreach. As a note of caution though, you must walk a fine line between staying in touch and overdoing it. Even your die-hard customers don't want to be spammed with promo emails and texts. To communicate tastefully, look for avenues such as:
- Personalized emails
- Sharing their posts or reaching out via social media
- Provide updates about business hours or takeout and delivery options
- Recognize birthdays
- Make recommendations
- Advertise deals and sales
- Offer sneak peeks
- Ask for customer feedback
Whatever you do, avoid inundating them with a deluge of messages. Instead, tastefully maintain contact and give them the opportunity to easily opt out of communication if they don't want updates.
Staying Positive When Dealing with Negative Customers
Unfortunately, building customer relationships isn’t easy. Throughout the customer lifecycle, poor customer experience and customer complaints are likely to occur. Things went south and the customer is unhappy. It happens to the best of us. In those cases, the most important thing is our reaction. Keep in mind, a lot of times customer complaints arise out of the customer feeling dismissed or unheard. Some tips in this type of situation include:
- Listen to the issue without cutting in or being defensive.
- Finding the root cause of the customer's distress and coming up with a solution that addressed that concern.
- Being respectful and understanding.
- Communicating quickly and effectively through the complaint.
Owning a small business is challenging, but the rewards are worth it. Your Nextdoor neighbors love to support their local businesses because when businesses thrive, neighborhoods thrive. Claim your free business page today and turn neighbors in to customers.
If you are a local business, claim your free Business Page to get started on Nextdoor. Resources on how to use Nextdoor to stay connected with your local customers during coronavirus, pertinent news affecting businesses, and more, are available in our Small Business Guide for Coronavirus Relief.