But how can you make sure that your customers stay customers for life? What strategies can you put into practice to keep bringing them back for more? A planned customer retention programme is something every established small business should have in place. That sounds great, but what is a retention plan and what should it include?

Do the Groundwork

Before starting a retention programme, you need to understand where your business stands now as regards its retention track record. Ask yourself these 3 questions:

1. Do you know how many customers you have lost in the last 12 months?

2. If you do know how many, do you know why they stopped dealing with you?

3. Have you ever quantified the impact these losses have had on your bottom line?

Before you can put an effective retention plan in place, you have to answer these questions. They are the key to understanding and implementing an effective retention strategy. Let’s look at each of them in turn.

How Many Have You Lost?

It’s essential you know how many people stop doing business with you at any one time. Keep a database of all your frequent customers; how often they buy; what they buy and in what quantity. Every month review the information and see if you can spot any worrying trends. Has the average order value been declining over the last 3 months? Has one customer’s regular order dried up altogether? If someone orders a large range of items each month but suddenly stops purchasing one particular range, why?

If you can’t track the customers you are loosing, how can you keep them or tempt them back?

Why Have They Turned Their Back On You?

Armed with the information on who’s deserting you, the fight back can start in earnest! There are sometimes very good reasons why business can dry up – the owner could have died, moved away, or closed down. Not a lot you can do about that! But what about more worrying reasons? Your product quality has gone down hill; the customer feels he is no longer getting value for money; your general service levels have declined. These are areas you have to know about, so you can get the business back on track.

If you see a slippage in business and you can identify who is contributing to it, then pick up the phone and get talking! Find out what the problem is. If you can bring them back into the fold, then great but if it’s genuinely too late, then at least you have gathered some important knowledge about where the business is going wrong.

What Has It Cost You?

Before starting a retention programme, you need to understand where your business stands now as regards its retention track record. Ask yourself these 3 questions:

1. Do you know how many customers you have lost in the last 12 months?

2. If you do know how many, do you know why they stopped dealing with you?

3. Have you ever quantified the impact these losses have had on your bottom line?

Before you can put an effective retention plan in place, you have to answer these questions. They are the key to understanding and implementing an effective retention strategy. Let’s look at each of them in turn.

How Many Have You Lost?

It’s essential you know how many people stop doing business with you at any one time. Keep a database of all your frequent customers; how often they buy; what they buy and in what quantity. Every month review the information and see if you can spot any worrying trends. Has the average order value been declining over the last 3 months? Has one customer’s regular order dried up altogether? If someone orders a large range of items each month but suddenly stops purchasing one particular range, why?

If you can’t track the customers you are loosing, how can you keep them or tempt them back?

Why Have They Turned Their Back On You?

Armed with the information on who’s deserting you, the fight back can start in earnest! There are sometimes very good reasons why business can dry up – the owner could have died, moved away, or closed down. Not a lot you can do about that! But what about more worrying reasons? Your product quality has gone down hill; the customer feels he is no longer getting value for money; your general service levels have declined. These are areas you have to know about, so you can get the business back on track.

If you see a slippage in business and you can identify who is contributing to it, then pick up the phone and get talking! Find out what the problem is. If you can bring them back into the fold, then great but if it’s genuinely too late, then at least you have gathered some important knowledge about where the business is going wrong.

What Has It Cost You?