In tough economic times should a business focus on increasing sales or profits? This is really a trick question, as sales and profits are both very important, but gaining more profit per customer is really the key. Often, you can see companies focus so much money on gaining new business that they forget how to maximize profit per customer. When you increase profit per customer, you will have a reliable revenue stream, that will build a solid business foundation. Also, by maximizing the revenue per customer, you will be implementing retention practices, that will produce loyal customers, who will do a lot of word of mouth advertising, thus reducing marketing costs.
The cost of gaining new customers is so high, it only makes good business sense to focus on keeping existing customers, as this will cost less and build a strong company profit. A strong relationship building process will need to be in place, to build an emotional bond between the customer and business and to discover their needs. This process will look different from business to business, but the principles are the same, look for ways to build a customer connection.
This could be as simple as front line staff being friendly and getting to know customers by name, and in the process gaining valuable feedback to improve your service or product. Now other companies might hire survey companies to phone the customer base, or they may have a retention team which contacts the consumer. Whatever method a company chooses, it needs to have a strong relationship building objective. As this relationship grows, it will provide invaluable feedback that can be used to improve company products or services.
Once staff get to know their customers, there will need to be a process, that allows them to document the customer needs or wants, so the marketing department can produce a more relevant retention process or address any customer concerns. Every business should be prepared to evolve to meet these changing customer needs, thus allowing the company to become stronger. Once a company becomes more customer focused, it will build a stronger and more profitable company.
The cost of gaining new customers is so high, it only makes good business sense to focus on keeping existing customers, as this will cost less and build a strong company profit. A strong relationship building process will need to be in place, to build an emotional bond between the customer and business and to discover their needs. This process will look different from business to business, but the principles are the same, look for ways to build a customer connection.
This could be as simple as front line staff being friendly and getting to know customers by name, and in the process gaining valuable feedback to improve your service or product. Now other companies might hire survey companies to phone the customer base, or they may have a retention team which contacts the consumer. Whatever method a company chooses, it needs to have a strong relationship building objective. As this relationship grows, it will provide invaluable feedback that can be used to improve company products or services.
Once staff get to know their customers, there will need to be a process, that allows them to document the customer needs or wants, so the marketing department can produce a more relevant retention process or address any customer concerns. Every business should be prepared to evolve to meet these changing customer needs, thus allowing the company to become stronger. Once a company becomes more customer focused, it will build a stronger and more profitable company.
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