Customer churn stinks.
After earning back your Customer Acquisition Cost, you might only make money for a couple of years before the customer bails to save a few bucks.
And the loss of potential income! Customers who stay for a long time and give you their whole portfolio can provide 10-20x the Customer Lifetime Value. That’s a lot to lose.
So, a fulfilling, profitable business comes down to winning customer loyalty. Super-satisfied customers don’t leave easily.
Here are three ways to create super-satisfied customers that tend to stick around.
1. Create Super-Satisfied Employees.
Your customers will never be happier than your employees.
Employees drive customer experience, which will determine the customers’ satisfaction. So, the arithmetic of your business looks something like this:
Employee Satisfaction → Customer Satisfaction → Customer Loyalty → Profitability
Alright, then what creates super-satisfied employees?
- Having enough money that they don’t have to worry.
- Knowing that their boss cares about them as people.
- Recognizing that their work has a purpose.
- Working with colleagues they trust, respect, and like (or at least don’t hate).
- Serving satisfied, long-term customers whom they’ve grown attached to.
In other words, pay your people better than average, surround them with quality peers, and give them ownership of the way they care for customers. Night-and-day difference between that and the carrot/stick approach.
2. Make Your Business About Relationships.
Too many agents are order-takers.
They sit in the path of industry-wide customer churn and take whatever business they can get. Much of that business is purely based on price. So, in turn, they’re vulnerable to price competition.
However, some agents focus on building relationships of trust. They reflect what Bob Burg said:
All things being equal, people will do business with and refer to those they know, like and trust.
And when you make it about relationships, the most valuable part of your business begins to grow. Short-term customers seem less interesting. Customers’ lives and stories start to take center stage.
That’s when your book will begin to give you long-term, high-margin payouts. That’s the reward for making your business about relationships.
3. Timebox Your Relationship Time.
Employees need regular engagement to feel safe and valued.
That means you need 1:1 meetings. Biweekly is probably right. The purpose of these meetings is:
- to help the employees talk about things that are important to them, whether personal or professional
- make sure they have what they need to succeed
- voice your belief in them and make sure you’re not doing anything to make them dumb or slow
It’s not a performance review. It’s not a project review. It’s deep-care time.
Put these meetings on your calendar and don’t move them. If your employee doesn’t need to meet, fine. But you have to demonstrate that it’s your priority.
Customers also need regular engagement to feel valued and reinforce their loyalty.
That means meeting with them 1:1 as well.
Sometimes all you’ll do is reinforce your commitment, which might be worth 3-4 years of recurring revenue.
Other times, you’ll find new ways to protect them or win business that they had elsewhere.
But that’s the by-product of your caring enough to invest the time. And customers will always know the difference. This is a matter of faith. You won’t know it’s working until you’ve done it for a lot of years.
But you already know, right? Because you’re also a customer. And you know what makes you loyal.
Just as with employees, you (or team members) need to block out time on your calendar to meet with customers. And if those times aren’t getting filled, outsource the appointment-setting. (I’ll skip the shameless plug.)
As you move away from employee and customer churn and move toward being surrounded by super-satisfied people, everything about your business will feel better. And you’ll make a lot more money, but as a by-product.