Some firms just seem to do business better than others. For the second time in a row, I found myself owning a house with a flat roof over the main entryway. And for the second time in a row the flat roof leaked incessantly during storms, causing significant interior damage. On the first house we just had a pitched roof built, but on the second roof it was too pivotal a part of the design to replace.
A Roofing Company That Really Knocked It Out of the Park
I got quotes from different roofing contractors and hired the cheapest. He replaced the roof, but soon this new roof was leaking, too. So I got quotes again and hired a more experienced roofing firm that put on an all-new copper roof. Once again, this second new roof leaked, too!
This time I went for the best, most highly recommended roofing firm I could find; let’s call them “Quality Roofers.” They also replaced the roof, using copper. I had them test the roof with running water and it seemed to work fine.
A few days later, a representative from Quality Roofers called looking for feedback on the quality of their work, something many firms still don’t do. I told them the work seemed fine.
We were soon hit with a major snowstorm that almost instantly turned to ice. Concerned about the weight of the snow on the roof, I cleared it off with a heavy metal shovel because the snow had frozen. Once again, the roof was leaking! I called Quality Roofers over to repair the damage and they and I both concluded that the only reason the roof was leaking was because I had brutally punctured it with the metal shovel. What really impressed, though, was that even though I had damaged the roof myself, Quality Roofers didn’t charge me a penny to fix it.
So next time we or one of our friends needs roof work done, it will be one call to Quality Roofers. No quotes. No calls to competitors.
During the following holiday season, Quality Roofers sent a packet to us saying, “As one of our customers, we are pleased to enclose a gift card to a popular restaurant, and if you are happy with our work, please recommend us to your friends.” You bet I would!
In his book I published, Streetwise Relationship Marketing on the Internet, Roger Parker offers additional thoughts on the topic.
“Once a customer, always a customer!” Wouldn’t it be nice if that were always true, says Parker. But we all know it isn’t. Future transactions and referrals have to be fought for almost as hard as the initial transaction. What transpires during the reinforcement stage determines, to a great degree, whether you will be enjoying a one-time relationship with your customer or whether the customer will become a repeat customer and—even more important—recommend your firm to his or her friends and associates.
The reinforcement stage is especially important to your firm’s profitability because, time and time again, it has been proven that repeat customers are less expensive to advertise to and—hence—more profitable to sell. The generally mentioned statistic is that it costs seven times as much to sell a new customer than an existing one. This is especially true now with email, because you can advertise to repeat customers without incurring any media, printing, addressing, or postage expenses.
The reinforcement stage is also valuable because it provides you with an opportunity to avoid buyer’s remorse, which often leads customers to try to return a previously purchased item. More important, the reinforcement stage provides you with opportunities to sell additional products to customers—enhancing their original purchase. Finally, marketing to customers during the reinforcement stage makes it easy for you to cultivate word-of-mouth referrals among their friends and coworkers.
5 Goals of the Reinforcement Stage
There are five basic marketing goals during the reinforcement stage. Most involve driving customers back to your website to take an action or learn more about the products or services you offer. The incentives are usually information and savings.
- Build strong emotional bonds with customers by thanking them for their patronage, expressing your appreciation for their purchase.
- Find out more about the customer’s needs and possible ways you can satisfy them—including improving your firm’s performance.
- Provide incentives to purchase additional products or services that complement the customer’s original purchase.
- Plant the seed for future purchases and maintain the buyer’s enthusiasm by describing new products and services as they become available.
- Provide customers with the tools they need to become your advocates and recommend your firm to their friends and coworkers.
A few enterprising firms have always done these things. But the problems of maintaining customer records and the costs—primarily printing and postage—associated with customer retention programs worked against their success. With email, however, reinforcement can be virtually free. All that’s needed is the discipline and imagination to set the program in motion and constantly search for new ways to re-approach old customers.
Start with a Thank You
One of the most important ways you can convert a transaction into an ongoing customer relationship is to thank customers for their purchase. The easiest and least expensive way to do this is to send an email thanking them for their purchase. Email is especially easy to send when the transaction, or part of the transaction, takes place online. Email works best when personalized, that is, different messages are sent following the customer’s initial purchase and follow-up purchases.
The impact of thank-you messages can be enhanced by offering a premium—something for free. Coupons worth special savings on future purchases work especially well because they give customers a reason to make an additional purchase. Premiums build future loyalty: everyone loves to receive something for free! Often, the thought is more important than the actual value of the product.
The choice of premium depends on the selling price—and profitability—of the original purchase. The best premiums are electronic, that is, they are instantly available and do not require postage and mailing. Ideally, the premium should reflect the firm’s personality (screen savers of healthy pets at play would make an ideal premium for a veterinarian).
Customer Satisfaction Survey
A customer satisfaction survey can be one of the most effective and universally applicable marketing activities that can take place during the reinforcement phase. There are two major advantages to immediately sending an email alert to customers asking them to fill out a customer satisfaction form within a few days of their purchase.
Responses to the customer satisfaction survey can provide you with statistical evidence you can use during the comparison stage to prove the claims you have made regarding your firm’s superior products and service. The customer satisfaction survey can be the source of numerous, powerful customer testimonials that personalize your firm, enhance your credibility, and prove your firm’s ability to perform.
Such surveys can help you monitor and solve the inevitable customer service problems that occur. Miscommunication, shipping or delivery problems, and other problems occur in even the best-run firms. Usually, they go unnoticed because customers typically complain only about the worst transgressions. A customer satisfaction survey, however, can provide customers with a way of bringing problems to light so you can solve them.
Often, what matters most in creating a satisfied customer is not whether a problem occurred, but whether the firm made any efforts to solve the problem. Over time, customer satisfaction surveys make it easy for you to identify areas in your firm that need fine-tuning.
The reinforcement stage is where you can most easily separate your firm from the numerous online and warehouse-style firms that compete primarily on price. Most Web commerce firms fail to build customer loyalty by seeing each sale as the end rather than the beginning of a relationship. Customers will not become repeat customers and advocates for your firm unless they are completely satisfied with their purchase. Problems must be dealt with competently and quickly if you are to enjoy a second chance with the customer or earn his or her recommendation.
It does take some work to do these follow-up steps, and the reward may not be another sale that day. But the cost and time invested in creating customers for life can go a long, long way toward building profitable sales and a successful business for years to come!
Takeaways You Can Use
- The reinforcement stage turns onetime customers into repeat customers.
- It costs seven times as much to sell a new customer than an existing one.
- Customer satisfaction is where you can separate your business from the rest.