“I didn’t know you sold that too!” she said after I asked why she didn’t call us before they bought their life insurance policies. I thought I had customer loyalty, or some brand loyalty.
And I was wrong.
I heard that often when I started my first insurance agency. You would think owning an insurance agency with a nationally recognized, household name, customers would think of you each time they thought of insurance.
It doesn’t happen.
If you own a small business, or an online business, your chance of being remembered are even less. Even if you offer the best products or service, someone is lurking around the corner to sell your customers something they could’ve bought from you!
Customer Loyalty Isn’t Dead, It Never ExistedTweet this
You’ve probably heard “customer loyalty is dead.” Or, “WalMart is killing the mom and pop, main street business.” Or, “Amazon and other online giants are cutting out local retail stores and destroying loyalty to neighborhood shops.”
WalMart, Amazon, and other stores like them may muscling their way into your town but they’re not the reason you’re losing business.
You’re the reason.
As a business owner we’re always searching for new customers. We’re hunting for the next sale, the next new customer. Then, once you find one, you want him to buy as much as possible while his wallet is still out? (Would you like fries with that?)
But most businesses neglect the third way to increase sales in business:
Sell more products to your existing customers!
This is the most overlooked area for almost every small business.
You spend money on marketing to drive new business.
You spend hours working on up-sell options to increase the average sale of each customer (I hope you have an up-sell).
So why aren’t you nurturing your customers so they buy from you again and again? (You can download a spreadsheet which will show you how small increases in each of the 3 ways will dramatically impact your bottom line here.)
Top of Mind Awareness = Increase Loyalty
When my customers said, “I didn’t know you sold that too,” it was typically followed with, “I would’ve preferred to buy from you. You’re easier to work with than the other guy and more fun to work with.”
Have you ever heard that from your customers? Talk about kicking a man when he’s down. This is the sales equivalent.
After about the 42nd time I heard they would’ve preferred to buy from me, I finally realized I had an awareness problem, not a customer loyalty problem.
It wasn’t about loyalty.
My customers liked me. They liked my staff. They like the products and services we offered. They liked my “brand.” They were “loyal.” They didn’t know to visit us first.
We weren’t “top of mind” when it came to specific products and services.
That had to change.
Implementing Customer Retention Strategies To Increase Brand Loyalty
Because of the awareness problem, I implemented a monthly newsletter mailed to all customers. It cost about $18 per year, per customer to print and mail. It wasn’t fancy and it was much less expensive than the cost of marketing to acquire new customers.
Within two years of mailing the first newsletter, we brought in over a million dollars in new sales from this simple monthly newsletter. Was the newsletter worth it? Very much so.
In the insurance business, the more policies I can put into your home the longer you will remain a customer. A person who owns three policies with us (ex. their home, auto, and life insurance) is less likely to shop their insurance around than a customer with only one policy. It’s more painful for them to leave (Or does this increase loyalty?).
This is true with any business. The more products you can sell someone they more likely she will come back to buy something when she needs it. And, as a bonus, she’s more likely to tell other people about you too.
But that’s another story.
If your marketing strategy doesn’t include customer retention strategies you’re losing money. There are few businesses where this is not true.
If you haven’t subscribed to The Resistance yet, do it now. In it I discuss how a nurturing program like this lowers your customer’s resistance and makes them more likely to purchase from you. Subscribe below. Or, buy my book Friction Free Sales and Marketing here. Or, you can find it at Amazon.
Does top of mind awareness build customer loyalty? I don’t think so.
You have to sell loyalty on a regular basis.
Loyalty is fleeting.
When you’re not in front of your customer you’re missing the opportunity to sell when they’re most likely to buy.