It’s a fact of business life, whether you’re selling ice cream cones to tourists or jet aircraft to Saudis, that “happy customers refer others. Each happy lifetime customer will create at least one new lifetime customer by word of mouth,” says Grace Butland, a business consultant who once owned Variations American Crafts Gallery in Riverton, Conn.
Tom Peters urges businesses to think of customers as “appreciating assets.” This holds true for both wholesale and retail, by the way. Store owners have always gotten together to compare notes on different suppliers, and with electronic communications today they do so nationally.
Businesses who provide good service have a built-in advantage, in that loyal customers often are willing to pay more, Butland asserts: “Would you rather pay more to go to a doctor you trust or take a chance on someone new? Try a new hair-coloring product or stick with one you know works well for you?” Customers are wary, and when they find a store or vendor or supplier they trust, they will pay higher prices for the peace of mind that comes with being able to rely on that source.
Butland says she saw this truth in her own business. “When I owned a crafts gallery, I was frequently approached by suppliers who had a less expensive mug, scarf, frame or whatever. But if I had one that was selling well, I wasn’t tempted to replace it with an unknown.”
CRM is simply the science of, as Paul Simon wrote, tryin’ to keep the customer satisfied. How does one do this? Butland has some suggestions your customer relationship management system should incorporate if it is to truly retain customers:
- It must be reliable. Make sure it can provide what it promises, when it’s needed. That means estimating your time requirements realistically, building in a margin of error and not over-promising — “All the answers online!” is fine if all the answers are online. Often they’re not, and the customer feels slighted.
- It must communicate essential information. Suppliers, use all that expensive CRM software you have to keep your customers informed. “If you are going to be late with an order, let the customer know,” Butland urges. Seasonal stock would be shipped late and languish on her shelves for months. Yet few shippers bothered to call and let her know something was going to be late. She stopped ordering from a number of talented craftspeople because they simply weren’t dependable: “Even if a customer decides to cancel an order rather than accept late shipment, he’s much more likely to continue doing business with you if you have kept him informed of anticipated delays.”
- It must treat customers respectfully, not perfunctorily. Your CRM must be courteous and prompt. Even if some questions seem trivial or unreasonable, they’re important to customers — who know when they’re being brushed aside.
- It must present your company’s best image. If your customer interaction is sloppy or disorganized, why wouldn’t someone assume your product is also?
- It must allow for personalized responses. “Sometimes this means breaking your own rules,” Butland suggests. “Maybe I just received a $1,000 order from you, and now I have a customer who wants a vase in the one size I didn’t order. I can’t afford to meet your $500-minimum order requirement again so soon, but I need to keep my customer happy. Would it hurt you to ship one item? The craftspeople I bought from year after year were the ones who always greeted my requests with ‘happy to do it.'”
- It must identify customers as individuals. Not just for data- collecting purposes, either. “Get to know your customers’ businesses,” Butland recommends. Are they seasonal? Did they try a new product or color with the last order? The more you know about your customers’ businesses, the better you’ll be able to make suggestions to increase your sales.” She says it’s a great way to get ideas for new products, one of CRM’s main goals: “I once asked a potter to make a few candleholders for ball candles. She did it as a favor to me, tried them at a show and then added them to her line because they were so successful.”
