Building your customer base through strong customer relationships and a managed referral program
Lasting customer relationships are possible, and the good news is that you don't even have to have the lowest price to make them last.
In fact, it's not about price - your prices can be higher than your competitor's when you have the edge on a long-term relationship. Such relationships take time to develop, once sealed though, it's difficult for you to lose a customer who you have a long term relationship with as they will value for more than just price your give them.
Build Trust
Trust is based on information of past behaviour and promises. So whatever you promise, you must deliver....it is not rocket science!
Beyond that, trust is built by sharing of both the good things that happen in a relationship and the bad. Sure, you're around when things are going great, but are you around when everything is falling apart? If your practice tends to forget about the customers when the things aren't going so well for them, this isn't a long-term relationship.
You know you're building trust if you answer a resounding YES to the following three questions:
- Do you think your business is able to make adjustments for customers to cope with changing circumstances? Long-term relationships will always function in changing circumstances, do you think you're willing to adapt?
- Do you believe that you inform your customers in a timely manner about events or changes in your business that may affect them?
- Do you think your business is committed to improvements that may benefit the relationship as a whole, and not just yourselves?
Signals
Good relationships are also forged with what might be called "signals." These are anything that informs the other party that you're interested in a long-term relationship. This could be simply actions that show how positive you feel about the relationship, but also less specific types of actions like a "thank-you for referring us" or personal gifts at special times such as birthdays. Some people don't recognize the power of a signal to positively influence a business relationship.
Personal commitments
If you want to really make your customer relationships last you have to use "credible commitments." Credible commitments are actions that you take towards your customers that have little value in other relationships.
If you find a customer who really want a long-term relationship, invest the time it requires. Competitors are always waiting in the wings able to take that customer over. So remember, long-term relationships are hard but profitable. It is the long term relationships that are the ones most likely to refer the business on.
Make it easy for the customer to refer the business
Provide referral cards, access to an easy to understand website, or even a regular newsletter than can be easily passed on. If you do get a referral, make sure you acknowledge the person who sent you the referral. Even if it's a simple phone call or thank you card.
Create a win-win situation
If you want to really ensure referrals you need to reward not only the person who sent you the referral but also the person who has been referred. Even if it is simply a thank you for their business or a follow-up phone call from someone to see how they found the service and whether it lived up to their expectations.
Regularly monitor client satisfaction
Market conditions constantly change and so does the competitive environment. To make sure you continue to meet your customer demands and expectations it's a good idea to do some regular research amongst your client base to measure satisfaction and competitive influences. This way you can ensure that you are continuing to meet client needs and expectations, which is critical in having good long-term relationships.
As you can see, creating strong customer relationships costs very little, however the rewards are high. It is much harder to acquire a new customer than to keep a current one happy and also provides a strong barrier to competitors.