Customer loyalty isn’t what it used to be. These days, people shop where they get the best value, and that doesn’t necessarily mean the lowest price. So how do you keep your customers coming back?
There is no more customer loyalty! Let’s face it, people go where they get the best deal. By that I don’t mean the cheapest prices but the best value for their money. Just because your customer purchased from you once, don’t be fooled into thinking that they will buy from you a second time.
Three Types of Customer Relationships
So how do you keep your customers coming back time and again?
To answer this important question you need to take a moment and think about what would keep a customer coming back to a business. Three instances come to mind:
1. The Customer and the Business Have a Positive Relationship
In this instance, the customer has formed a positive relationship with either a person who works for the business or with the business itself. Perhaps they had a great experience and they now have an emotional bond with the business. Unfortunately, unless the emotional bond is nurtured, it dies a fast death – – and quite frankly, there are extremely few businesses that nurture their relationships with their customers.
2. The Customer is Incentivized to Continue the Business Relationship
People are human and because of that we are naturally greedy. The principle of greediness is what makes capitalism successful. Companies who reward (bribe) their customers with coupons, points, credits, and bonuses create an incentive-based relationship that crumbles once the incentive is taken away.
3. The Customer “Has” to Continue the Relationship Because the Cost to Change is Too High
This is an instance in which the business has tied its operations into the customer’s life or business so closely, that to move to another product or service provider would cause damage emotionally, socially, operationally, or financially. An example of this type of relationship would be a person who is emotionally dependent on his therapist (emotional) or a customer who uses your software to run their business (operational).
I call this third type of relationship an “Integrated Relationship” because it extends into the life of a person or into the operations of a business. Of the four types of Integrated Relationships (social, emotion, operational, financial), the operational relationship is the most powerful. Operational relationships exist when the actual work processes of two businesses overlap.
The Secret Key to Guaranteed Repeat Sales
Each of the three types of relationships just mentioned keep customers coming back, but the first two are somewhat easy to break. The Integrated Relationship; however, has severe penalties for breaking the relationship and; therefore, forces the customer to come back again and again whether they like it or not. This is the ultimate customer relationship and the secret key to guaranteed repeat sales.
Look at most highly successful companies and you’ll find that they have developed Integrated Relationships with their customers. The following are two excellent examples of companies that have created Integrated Relationships.
1. Campbell Soup
Campbell’s Soup has developed a successful vendor-managed inventory (VMI) program with its customers. A VMI program provides continuous replenishment for its customers by monitoring the customer’s inventory levels (physically or via electronic messaging) and makes periodic resupply decisions regarding order quantities, shipping, and timing. In effect, Campbell Soup has literally taken over the entire replenishment function for its customers.
2. FedEx
FedEx installs computer terminals in many of their customer’s businesses that help to determine shipping requirements, track shipments, and even integrates into the customer’s inventory, accounting and order management system to automate the returns process. This literally forces the customer to use FedEx for their express mailing needs.
Questions to Ask Yourself to Jumpstart Your Creative Thinking
The following are questions that you can ask yourself in each of the four areas of Integrated Relationships that will help give you ideas about what you can do to create an Integrated Relationship with your customer.
Operational
1. Do you have a technology that you can deploy into your customer’s business?
2. Can you take over or manage a portion of your customer’s business operations?
3. Can you house or manage your customer’s data or assets at your place of business?
Social
1. Can you get your customer to be a public poster child (i.e. provide a public testimonial) for your business?
2. Can you create a brand so “cool” or popular that to not use it would be embarrassing?
3. Can you present an award to your biggest customer(s) (or target prospect) and announce it to the industry?
Financial
1. Can you offer a program that requires a large upfront investment that delivers products or services over time?
2. Can you offer your significant customers an opportunity to financially invest in your business?
3. Can you lock your customer into a long-term contract with penalties attached for breaking the relationship?
Emotional
1. Can you hire influential people in your industry (i.e. recognized industry experts, high-level executives in big companies, popular service professions) that already have very close relationships with target customers?
2. Can you provide your customer with so much support (i.e. advice, attention, help) that they can’t do without you?
3. Can you align your product or service with that of an existing, highly popular product or service?
Conclusion
Take some time to brainstorm how you can create Integrated Relationships in your business. Think about how you can extend your products or services “into” your customer’s business so that their cost to switch to another provider is overwhelming. Remember, the most powerful relationship is one in which you and your customer’s business processes are intertwined, so focus on creating Integrated Relationships.
