Whether you’re bootstrapping a young startup, are running a side hustle with little-to-no budget or are a business owner who’s trying to keep your expenses down (i.e., every business owner) then you’re constantly on the lookout for cost-effective ways to increase revenue. The number one way to accomplish that goal is to keep your current customers happy and buy more product/service from you.
Considering that it can cost you anywhere from 5 to 25 times more to acquire a new client than it costs to sell to an existing one, it’s easy to see why retaining customers and returning customers are the goals of every business.
The good news is that keeping customers, keeping them happy and keeping them returning for more can be frugal friendly. Aside from providing your customers with a product or service that (more than) adequately solves a problem or fulfils a need, it can be little things that keep you top of mind and your brand positively associated with key customer emotions – the ones that are sometimes responsible for making the purchase decision.
So, below are 3 (fairly obvious) customer retention tips for frugalpreneurs, and really, are there any business owners that aren’t?
Thank Your Customers
Ok, so almost every online vendor sends a confirmation/thank you email when you’ve made a purchase. But can you remember one that stood out to you when you got it? Did it have big, colourful graphics or animation? Did it remind you of opening a gift? Sure, you may not be a programmer or be able to hire one, but almost every email service provider can allow you to get creative with fonts, colours, gifs and basic animations like fireworks or bursting confetti while allowing you to save the email template.
And while it may not be financially or logistically realistic to send hand-written thank you cards to each customer, it’s not necessarily counterintuitive to frugalpreneurship to do so. The small investment in bulk cards, postage and time is a nice touch that can almost guarantee your customers will appreciate and remember you and over the course of time that small investment could pay exponentially.
If your sales are in-person instead of online, all of the above can still apply. Sure, people are sometimes wary of giving out their email addresses but if they’re happy with your product/service they may part with them, especially if you tell them it’s so that you can invite them to exclusive customer/member appreciation sales.
No matter how you drop your note, it’s a good idea to include contact information of “a person who can be reached in case the client has an issue or question”.
Go Out of Your Way to Make Unhappy Customers Happy
“How you handle complaints can determine whether a customer returns to you in the future”. Sure, not getting complaints in the first place is the goal of every business but sometimes complaints and unhappy customers are beyond our control. It’s how you respond that can turn a potential “PR nightmare” into a story that gets (positively) shared on social media that can not only keep a customer but win you new ones as well. How many readers of this post bought a parka from Patagonia or an iPhone because of Patagonia’s and Apple’s (formerly) well-known, generous return and exchange policies?
Survey Your Customers
There’s a reason that Fortune 500 companies and large multinationals spend thousands of dollars every year focus grouping new products, services, TV shows and movies. One of the best ways to retain customers is to know exactly what they’re willing to buy. Getting customers to fill out surveys can be as challenging as getting their emails in-person but offering discounts as incentives is also not contrary to frugality. Like coupons meant to entice more purchases, a discount exchanged for valuable insight into your product/service could pay off exponentially.