Published April 22, 2009

5 Ways to Form Customer Relationships Effectively

When you are operating a small business the competition between you and larger companies can often feel like a David versus Goliath situation. However, there is one area in which the small business has an advantage over the large.

It is far easier to form customer relationships when you are a small business than it is when you are large. Fortunately, money can't buy these relationships so it is up to you to foster them so they help drive your business.

There are a number of methods that companies use to form customer relationships and some are more effective than others.

The following are five proven tactics used by successful businesses and entrepreneurs to form customer relationships.

  1. Happy customers are loyal customers. Make sure you keep your customers satisfied and stay in touch with them. E-mail them regularly with a newsletter. Make sure the newsletter is of value to your loyal customers.

    It can update them on the goings on with your business, offer them helpful tips for daily living and even present them with special promotional offers. This will not only keep them returning but it keeps your business fresh in their mind.

    This means they will be more likely to recommend you to someone else how may need your services.

  2. Give your loyal customers incentive to keep coming back. Loyal customers spend more on average than new customers do. So, if you give them incentive to return and repurchase, your profit margin will see a boost.

    Offer them coupons or special offers for a return trip. You can do this at the end of each transaction or through regular correspondence. It doesn't have to be much, just something that makes them feel appreciated.

  3. When you are on a budget it can be difficult to stay in touch with your clients. Email marketing is an easy, effective and inexpensive way to maintain regular contact with your customers. The best way to do this is through regular newsletters.

    You can allow your customers to sign up for the newsletters and even offer them a small coupon or incentive for doing so. The email newsletter should be helpful and service relevant.

    It should offer tips, advice and product suggestions to attract customers back for a sale.

  4. If you are not careful customer relationships can be brief. Handing out business cards or meeting with prospective customers one time simply doesn't cut it. Follow-up is essential to gaining new customers.

    When you meet a prospective customer it is important to contact them immediately by sending them a quick note that lets them know they are important to you.

    This helps you stay fresh in their memory so that when they need your services they will think of you.

  5. The most important thing you can do to form customer relationships is to create a business network. A business network can include customers, colleagues, business acquaintances, partners, association members, friends, family and community.

    Use your newsletters, e-mail and other incentives to maintain this network and create loyal customers that will return to your business. Plus, they may even bring in new customers.