We all know it's easier to retain a customer than to find a new one. However, many manufacturers continue to pour millions of dollars into new business development while neglecting simple customer-retention strategies.
In a global economy with competitors at every corner, customer satisfaction is imperative to maintain and grow your bottom line. It is said that it is easier for great service to overcome a second-rate product than it is for a great product to overcome second-rate service. We've all been on one side or the other of this coin. When I asked a group of executives recently, they unanimously agreed that they would rather go up against a rival with second-rate service any day.
As sales managers, we must realize that customer retention is every bit as important as new business development, and it can be achieved at a fraction of the cost of finding new customers.
In manufacturing, we rely on standards such as ISO 9001, which sets protocol for continuous improvement. ISO 9001 understands that each manufacturer is different and allows us to set our own objectives.
Ironically, customers actually know more about your products and services than you do. Customers know:
* What it's like to buy your product and deal with customer service and technical support.
* What it's like when a delivery is late, damaged, or incorrect, and whether you honor your return policy.
* Whether you return phone calls.
* Whether your product provides value.
In most cases, an unsatisfied customer can be retained with just one short phone call by a manager or sales rep. However, too many companies take customers for granted and then must invest thousands of dollars to replace them.
Rappaport is director of sales and marketing for Business Answers International, a Palm Beach Gardens, Fla., industrial consulting firm.