11 Importance Of Building Strong Customer Relationships
You know a bad customer service experience when you face it. You leave a business feeling unsatisfied and unappreciated. Even amongst the confusion, you realize that you never want to shop with that same business again.
As an entrepreneur, you should learn the importance of customers to your company. They give it a reason and means to exist. This is why you must keep yours happy and maintain them. Regardless of how long you have been in business, you must have heard the phrase “The customer is always right”.
The person who coined this phrase wasn’t drunk when he said so. He is aware of the importance of building and maintaining good customer relationships which should be the primary objectives of firms because of its importance. Many establishments have even created a special department in their head office and branches to deal with customer complaints and serve as a link from the management to the customers.
Customers are the heartbeat of any establishment.
A satisfied customer is surely going to tell other people about your business, and the satisfaction he got from it. For this reason alone, you will get more profits in the future. The mistake most businesses make is putting profits before customer satisfaction. Yes, the main objective of every business organization is to make profits, however, never do it at the expense of customers’ satisfaction.
It would have a boomerang effect on the financial balance of your firm. With that in mind, here are 10 importance of building customer relationships.
1. It Reduces The Risk Of Losing Customers
It is a common belief that the major reason why customers will run away from your product is because of prices. However, recent studies have shown that prices are only minor reasons customers stopped using a product.
Experts have found poor customer relationships to be one of the major reasons businesses lose customers. As a new business, you need to set up a customer service desk as soon as possible because no business is too small to receive complaints. When customers don’t know who to complain to, they might switch choices.
As a large company or business, you need to track customer happiness and satisfaction by setting up opinion boxes. You could also personally take your time to ask customers what they think should be added to the already existing service.
These are initiatives that could help to build a lasting relationship with your customers. Also, you can try hosting an end of the year party to bring your customers together to establish a kind of communal relationship where they can socialize with each other.
2. It Creates A Competitive Environment
In a competitive environment, having a strong customer relationship could mean the difference between you and your competition. The fight for customers is what business is all about and if your customers are not satisfied with the way they are being treated, they will take their contracts or money to your competition.
If you neglect this slight move because a few customers switched ships, then you might be humbled when half of your customers do the same. You have to take the departure of even one customer very seriously.
According to experts, in a situation where you have a competitor with similar products or services, customers will most likely go for the one with better customer service.
Customer service is a strategic business advantage that can be used in any competitive market.
I have an aunt who owns a restaurant. She applied to cook for a university and was given the contract. However, there was another caterer who also stayed in the school canteen and prepared the same type of meals. My aunt noticed that the woman who was already there didn’t really care about the students, she cooked late, her staff were mean and arrogant.
So my aunt took advantage of this and made sure her customer service was top notch. She introduced new meals, added incentives and prepared her food early enough for students who wished to eat before going to class.
In less than a month, my aunt had successfully taken more than 80% of the student population, turned them into loyal customers and eventually attracted bankers and school academic staff also came to eat.
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3. It Influences Repurchase and Loyalty Functions
Building a good customer relationship gives you an assurance of repurchase and loyalty from your customers. A happy customer will always come back for one thing or the other, but an unhappy customer will try someone else when he needs assistance in the future.
Any business that takes customer service seriously usually ends up with the most loyal customers in the market. If you are a sole proprietor, make sure to interact with your customers when they come to make a purchase.
Ask them how their day went, tell them about any added exclusive incentives that you might be offering to them, everybody likes the word free, no matter how small it is.
4. It Is Less Expensive To Retain Old Customers Than Look For New Ones
This is very true indeed. Statistics prove that it is six times less expensive retaining customers than acquiring new ones. Imagine the cost of TV Ads, Radio Ads, and newspaper Ads plus Social media promotions.
All these put-together are capital-intensive projects, one that a company shouldn’t be engaged in too often to ensure that they keep their heads above water when it comes to their finances.
However, when you embark on this project and you are able to attract and sell to customers, then you are now tasked with the job of building and maintaining a good relationship with these new customers you have acquired.
5. You Would Be Able To Establish Networks And Connections
Building and maintaining good customer relationships can help your business when it comes to link-ups and connections. Let us assume you manage a bank and you are able to satisfy customer A.
Then Customer A goes home and he meets his friend Customer B who is looking for a suitable bank to deposit his money, there is a very high probability that customer A will praise and recommend your bank because of the kind of service and treatment he got there.
Do you now have an idea of how this connection works? When you are able to satisfy one person, you have successfully advertised your business because that customer will tell someone else.
Do you now see why businesses these days are taking customer satisfaction very seriously? It is a low budget, effective and beneficial advertisement strategy?
6. It Could Reduce Market Rejection
This is the opposite of what I explained earlier. You do not want this for your business. People are good at spreading the word about a good service they experienced in the hands of your company.
However, customers are even better at spreading the word about a terrible service they experienced in the hands of your company. According to experts, a dissatisfied customer could tell around 13 people about a terrible service he got from your business. Therefore, you must take great care to monitor customer satisfaction to avoid having a bad reputation on the streets.
Once in a while, take your time to conduct a survey or a poll on your social media handle or your website. Ask customers to rate your customer service on a scale of 10-100%. If your overall rating is less than 70%, then there is a need to up your game. Whichever of your department needs a check-up, monitor it and fix it.
7. It Increases Revenue From A Single Customer
Building and maintaining good customer relationships can help to increase the revenue you can generate from a single customer. For instance, when you go to purchase a phone from a gadget store and you got free earphone, some candies and wonderful customer service altogether, how would you feel? 😆
Now tell me, if your charger should get spoilt after a while, where are you going to purchase another charger, that previous store right? Yes!
That is how good customer service can help your business. It can increase the amount of revenue you generate from a satisfied customer. As long as you are honest, calm, friendly and approachable while selling a product or delivering a service, your customer is surely going to come back again.
8. It Creates a Secured Customer Base
The market is a very competitive place and very unpredictable as well. You can compare the market to a rollercoaster ride. One minute, it is up and the next, it comes crashing down.
In a situation where this kind of event starts happening, it is an advantage to have a secured customer base. At least, one that you know will buy from you no matter what.
The only way to do this is by building and maintaining a strong customer relationship, interacting with your customers and providing their needs to the best of your ability.
9. It Prevents Young Business Failure
According to experts, one of the major reasons why young businesses fail is because they often neglect customer service. It is important to note that customers are already used to the popular brands that meet their needs. You will need to have an ace up your sleeves to bring in your own product.
Good customer service can be the ace up your sleeves, it is very likely that due to the popular brand has acquired over the years, they will hardly have time to satisfy customers properly, and that is where your business comes in.
You should promise a far better customer service and the same product at the same price. This is a sweet deal that any customer would love.
10. It reduces Churning Employees
Everyone with a conscience likes to work in a conducive environment, where hard work is appreciated and customers are treated fairly. Take away any of these things and you might have to lose employee every month.
Building and maintaining good customer relationships helps to reduce turnovers because happy customers and satisfied workers make up a healthy, profitable and lasting business. Your ability to create this kind of environment is what makes you a great manager.
11. It strengthens Your Brand
A brilliant entrepreneur once said “The best brand is not one that makes the most profits annually. The best brand is the one known for its brilliant customer service.” This made a lot of sense to me because I could see that it was evident in my life and the way I make everyday financial decisions.
When I was a kid, there was this store I go to whenever I want to purchase cheap footwears, although their customer service was average. However, my mom would still take me to the bigger stores in the city to purchase more expensive footwears because of that brilliant customer service.
Generally, people love to be treated specially and they might even be willing to pay extra for this comfort. However, it is important that I point out that you don’t have to go over your budget to satisfy customers, a simple gesture can be enough evidence that you care for their satisfaction.
There is a bank in Nigeria that serves candy to customers waiting in the reception. It was just candy, but I could see how customers appreciated it.
In business, it is important to set goals and priorities. A good business builds on the foundation of customers’ trust and reliability which eventually becomes excellent.
The importance of building and maintaining good customer relationships cannot be overemphasized. This is why I have taken my time to do an article that explains the importance of building customer satisfaction. This should come first in your company’s agenda.
Now that you have this piece of information at your fingertips, feel free to maximize it. Don’t ever underestimate the importance of building customer relationships.