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Invest In Your Customers!
Never has a customers value been more important than it is today. Owners & managers absolutely must focus on maintaining existing customers while adding new ones. Today, your customer is worth much more to your company than any of your employees realize, plus this same customer also offers the greatest new potential for increased growth and profits.
Just in case you aren't really sure yourself about your Customers Lifetime Value, here is the formula you can use to compute it: CLV = AS x SPC x %M x RI
{You will find the explanation of this formula at the end of this article.}
Five Tips TO Improve Your Customers Lifetime Value
Tip #1 - Make sure your employees know what level of performance is expected of them, both on the job and at your shop.
- Comment: Usually improper or inadequate performance occurs because the employee doesn't fully understand their responsibilities. This is usually because they were not trained in the first place.
- Suggestion:
- Make a list of performance requirements for each job.
- Make sure these requirements are understood by everyone.
- Stress the importance of being able to perform as expected.
Tip #2 - Teach your employees to look the customer square in the eye and say 'THANK YOU'.
- Comment: You must hire people who can do this. They will need these simple characteristics...
- They like themselves
- They like other people
- They like to help people
- Suggestion: You, the employer must set the tone. Smile and thank your employees as appropriate and they will do the same for your customers.
Tip #3 - Provide customer service training & education for your employees continually.
- Comment: You wouldn't hire a person as a typist unless they had the ability to type would you? It makes no sense to hire an employee without 'critical area training' first.
- Suggestion: In today's competitive market arena, companies that spend money to train & educate their employees get far better customer keeping results than comparable companies who spend the bulk of their ad dollars focused on attracting new customers.
Ask yourself these questions:
- What is our advertising budget this year?
- What is our training / education budget?
- What does it cost us when an employee quits?
__$500 Or less?
__$500 - $1000?
__$1000 Or more? - How much training does a new employee receive? Is CLV included? ( tell the truth )
__a week or more of classroom & O J T ?
__a day or more of classroom & O J T ?
__an hour or more of classroom & O J T ?
__none ?
Tip #4 - Encourage & train your employees to start doing what your competition is too lazy to do!
- Suggestion: Meet with your people and discuss things your customers want, but you can't deliver now.
Can you provide these 'wants'?
- Make a list of things that, if done differently, would put the customer first
- Make a plan to put these ideas into action on a regular basis
- Stick to that plan
Tip #5 - Give every employee their own personal business card.
- Comment: A personal business card of their own indicates that the employee is an important part of the company, both to the employee and the customer!
- Suggestion: Make a list of all employees in your company who do not have a business card. Be sure to include every employee!
- Call a meeting and explain that every employee in your company plays an important part in the success of the company. Point out that on or off the job they represent the company. Explain just how important it is that every person have his own personal business card. { Make sure that each name is printed exactly as it should be! }
- Use your computer and the readily available designer business card stock available from your office supply source. Print them on a laser or a quality ink jet printer and you will have inexpensive and outstanding business cards. You can print as few as 10 and the perforated card stock available enables you to make these for two - three cents each!
- No computer or no time? Call a local person who works out of their home and let them do it for you.
How your employees see themselves as well as how they are perceived by the customer will have a major impact on whether that customer calls you again or not. The simple use of a business card really helps make an employee feel important. It greatly increases the potential that they will treat your customer in a caring and concerned way.
NOTE: "CLV = AS x SPC x %M x RI" �. . . stands for Customer Lifetime Value = Average Sale X Sales per Customer frequency X Profit Margin [as a per cent] X Referral Index [or frequency]
