customer retention
customer retention

Customer Retention and Your Home Based Business

Many times customer retention is over looked in the home based business. We are so focused on our marketing campaigns and new customer numbers that we forget one of the most valuable assets of our home based business. What if you could keep over 80 to 90 percent of your current customers and still continue gaining new customers from your marketing efforts?  Would that stop and make you think?

You would be doubling your marketing efforts with happy and repeat customers yet you would actually still be paying the same amount for your marketing campaigns. Your customer based would grow at faster rates and of course so would your profits.

Let's take a look at what is involved in acquiring new customers in the first place. The cost of getting new customers is probably more then you realize. First there is researching of products and manufacturers. Then product and service development and implementation. There is the layout, web design or the shelving and placement if you own a brick and mortar store. You spent time on your life plan, business plan as well as creating a business image. Then there are the marketing strategies including business cards, press releases, media campaigns and word of mouth advertising that you put your time, energy and money into.

There were still many other items that you and your home based business needed to do to acquire new customers. Customer retention should be a major player in your marketing efforts as well.  Remember the most important point is that everything you do for your home based business is for your customers. If it wasn’t for the income you receive from them you wouldn’t have a home business!

So what is the value of customer retention to your home based business? Let’s explore just a few of the benefits of keeping your customers coming back. In my articles; Offer Excellent Customer Service, and Customer Service Tips for Excellent Customer Service, I give you some examples of what the customer is expecting and offer customer service tips for staying on top of those expectations.

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Reasons for Customer Retention

  • More Income - They are your home business revenue life line.

  • Free Word of Mouth Advertising - They will become your unpaid advertisers

  • Repeat Business -They will insure constant sales for your home based business

  • Builds Long Term Relationships – They will become your long term friends

  • Business Contacts – They will help you in your home business success.

More Income

When you run a home based business the first thing you will try to figure out is the Rate of Return on Your Investment (ROI). That investment includes all of the costs associated with gaining new customers that I mentioned above.  If you figured out the cost broken down per customer you will easily realize that you don’t want to keep losing customers you already have. They cost you too much to get. Customer retention benefits your home business by having a continuous flow of happy and satisfied customers purchasing your great products. 

Free Word of Mouth Advertising

How often have you used a great product or service and was happy to tell people about your purchase? If the business offered excellent customer service you would probably start telling friends, family and business associates immediately after the initial shock wore off. You might be at work, home, meetings or at parties when someone mentions that they are looking for something that you use and like. It is really easy to tell people about your great experiences when you are trying to help them solve their problems.

Repeat Business

Excellent customer service will keep them talking about your home based business as well as coming back and purchasing more items. Use these customer service tips to help enhance customer retention. Repeat customers offers your home business a steady stream of income which will increase your rate of return on your investment of time, energy and money.

Builds Long Term Relationships

Customer retention relies on trust. If you keep a satisfied customer for long periods of time then you actually become or almost become good friends. The longer anyone does business with you and your home based business their level of trust continues to grow. These customers are proof that your business is offering exactly what is needed to fulfill their needs.

Business Contacts

When you retain customers and have long term relationships then there are many more chances that one of your customers will be able to help your home based business in other ways. You may find that one of your customers is a real estate broker or attorney. Possibly they know of a great advertising firm etc. The point is that it is easier to be referred to great services and products then to cold call from the Yellow Pages.  

Bottom Line

Customer retention is the best way for your home business to grow and succeed. Offering excellent customer service and doing your best to retain them will reap you many rewards. When you lose a customer try to find out why. Was it your product or service? Where are they purchasing now? Did you lose their order? How can I get them back? After you lose a customer start asking those questions immediately. You want to correct the issue if possible and not lose any more. Don't take it lightly.

Customer retention is much more cost effective then getting new customers. Your home based business has spent time, money and effort to acquire new customers. You now have clients who already know you and have given you money before. You have gained their trust and confidence. Offering excellent customer service and applying my customer service tips will increase their purchases and improve your home business cash flow.  

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