BNET recently posted an article titled, “Treat Your Customers Like Lifetime Investments”. They told the story of most retailers having a dismal year, with larger companies laying off employees and closing stores, and a smaller operations shutting down altogether. At the same time, Zane’s Cycles, a Branford, CT bicycle retailer, increased revenue 20 percent. How? Years ago, Zane’s established a service-focused company culture that keeps customers coming to the store in good economic times and bad. “When we changed from trying to force our customers to buy what we had to creating a relationship with them based on providing them with whatever they needed, then everything changed,” CEO Chris Zane says.
The 29-year-old store sets itself apart from competitors by offering free lifetime service and parts on everything it sells, as well as 90-day price protection. Zane has tracked sales and customer data over a number of years to discover the average customer’s “lifetime value” — the gross revenue he or she will bring in over time. “The lifetime value of a customer [for me] is $12,500,” says Zane. “That gives me $5,625 of profit. My customers are valuable, so I treat them that way.”
How can you turn your customers into lifetime fans? Here are Zane’s tips:
- Focus on customer relationships, not one-time transactions. Discounts and sales may lure in one-time buyers, but they won’t keep them coming back. On the other hand, Zane’s policy of giving away anything that costs under a dollar helps create raving fans.
- Give your employees permission to do whatever it takes to keep customers satisfied — even if the customer’s request might seem unreasonable. When a customer recently complained that a new bicycle from Zane’s had made a grease mark on the back seat of her car, an employee offered to treat her to free professional detailing. “It becomes a much easier existence for our staff. There’s no worrying if you’ve made the right decision, “ Zane says. “You just do what the customer wants.”
- Make every customer interaction fun, informative, and positive. That’s every interaction — even when it’s clear they’re not going to open their wallets that day. Zane’s customers are treated to free coffee and soft drinks and encouraged to linger in the store.
- Stand by your products with service and price guarantees. In a lousy economy, that may sound like a recipe for bankruptcy, but Zane says only small numbers of people actually take advantage of the guarantees. And the pay off is customer loyalty and trust.
Have you calculated the lifetime value of your customers? Can we help you create a strategy to make your customers feel appreciated?