Every cable customer has likely experienced this scenario at one time: You see an ad on television from your provider for a great deal on a robust cable package. That deal would save you a significant amount of money each month. You call your provider to switch to the deal, only to be told that the offer is for new customers only. You beg, you plead, you reason, to no avail. You hang up the phone and immediately begin researching new providers.
Attracting new customers is essential for long-term retail growth. However, it is important to do so without alienating or neglecting your existing customers. Walking this tightrope isn’t easy, but it can be done with attention to some very important do’s and don’ts.
Don’t: Confuse Your Existing Customers
Let’s say you choose to focus more efforts on attracting millennial shoppers. To do that, you decide to overhaul everything at once. You launch a new logo, a new tagline, new store hours, a new website, a new app, and an entire new product line all at once.
This may be extremely exciting, however, you risk confusing your existing customers and sending them right into the waiting arms of your competitors. Communicate your changes clearly, months in advance. Paint them in a positive light, show the benefits, and even provide previews of your new assets. Then, launch changes slowly, so that existing customers have time to get used to the change while still feeling valued.
Do: Grandfather Existing Customers
A tried-and-true method for attracting new customers is to make changes to features, benefits, products and services. However, you have plenty of existing customers who love what you’re currently doing. If you must make a shift, don’t take things away from your loyal fan base. For example, if you are launching a new rewards program, consider making all current members in good standing premiere members of the new program right off the bat, rather than making them start from scratch; or give them an entire year to use their rewards from the existing program so they do not feel as though they are losing benefits that took years to achieve.
Don’t: Focus Too Much On Shiny New Objects
It is very easy to get caught up in feedback from new customers. They have a fresh perspective on your store and the prospect of converting them into long-term customers is mouth-watering. However, they should not have more influence on your business decisions than your existing customers, who have kept your lights on over the years. Pay attention to new data and listen to new feedback, but be sure to weigh it against the data and feedback you receive from your loyal, existing customer base.
Do: Listen To What Your Data is Telling You
What is the fastest way to ensure a mass exodus? Ignoring data. If you do not keep tabs on the way the customer behavior changes in tune with changes to your products, you’ll find yourself losing long-term, loyal customers. Every time you make a tweak to attract new shoppers, pay very close attention to the impact those changes have on your existing customer base, so you can close gaps quickly and spot behavior that could lead to attrition before customers leave.
New customers are essential for growth. However, it is important to remember the value that your existing customers bring to the table. According to research by Bain & Company, increasing customer retention rates by just five percent can increase profits anywhere from 25 to 95 percent. That’s why it is essential not to get clouded by the quest for new customers. Actively pursue them, but remember to take measures to show the people comprising your existing customer base that they are golden to you.