Limousine company owners often focus most on securing new customers rather than retaining current customers; in doing so, they overlook a tremendous opportunity. According to Marketing Metrics, selling to existing customers is roughly 50 percent easier than selling to someone new.
Retaining customers has to be a priority. To accomplish this, consider the following five highly effective customer retention tips.
For all industries, including limousine services, customer retention plays a vital role in growing the bottom line. For example, profitability can increase by a whopping 75 percent with only a 5 percent increase in customer retention, according to Bain and Co. Gartner Group estimated that just 20 percent of revenue coming from current customers accounts for as much as 80 percent of a company's future revenue. It will cost 5 times more to attract new customers than it will to retain those customers that you already have.
Customer Retention Program
A common misconception held by limousine companies and others is that the combination of great service and superior customer support is the only thing needed to retain customers. Although this may work for a short time, eventually this philosophy fails or even backfires. Remember, your customers owe you nothing, so you have to consistently earn their loyalty.
To identify, track, and customize promotions for customers who will become loyal, your limo company could benefit from a customer retention program. With a retention program, problems can be anticipated prior to occurring or brought under control before getting out of hand. Other benefits of a customer retention program include consistent customer service, exceeding customer expectations, measuring customer loyalty, and tracking/measuring customer satisfaction.
Understanding the Customer
To keep customer retention rates high, customers have to be understood. In the Harvard Management Update, Bain and Co. determined that of companies surveyed, 80 percent believed they provided stellar customer service. However, only 8 percent of customers agreed.
By understanding the customer, a limo company can focus on customer behavior to learn more about what customers want and need. With this information, future behavior can be better analyzed making it possible to create a far more effective limousine marketing strategy.
For building customer retention, social media is an excellent channel. When done right, this provides customers a voice and platform to connect with other customers, which helps boost website traffic. The key to engaging with customers through different social media sites is to create alerts that inform you when someone says something about your company, whether good or bad. This way, you can rapidly respond to customer feedback.
Once loyal customers are identified, a personal email saying thank you along with promotions will go a long way in making them feel important and appreciated. Customers who use social media can quickly become huge advocates or massive PR problems.
Promotions are also effective for retaining customers. While promotions allow customers to become actively engaged with the company brand, they must be relevant and geared toward rewarding customers so they feel good about their involvement. A great way to encourage repeat business is through a loyalty program. When tailored to specific customers showing signs of drifting away, special discounts are highly effective.
The Bottom Line
If you are passive about customer retention, surviving is going to be a major challenge for your company. By being actively involved with customers through timely communication, they stay engaged while having needs met. If you need assistance, DriveProfit offers a wide range of limo marketing strategies for better customer retention.
Posted on Jul 24 2015
Share on Social Media