Customer loyalty is key to your longterm profitability
Consider the following before you start to plan your customer loyalty strategy:
- The 'show-up-for-renewal' type of broker risks losing a steady stream of existing customers. You need to know who is about to leave you.
- It costs between five and eight times as much to retain an existing customer as it costs to acquire a new one, particularly in our industry where lifetime value is so important.
- The most successful brokers treat customer loyalty as a business philosophy, not just a technique.
- Perceived indifference is the reason why 68% of customers take their business elsewhere.
- A mutually beneficial relationship is key to increased customer loyalty and longterm business success.
Your No.1 priority must therefore be to keep in touch and delivering continuous added value to your customer base.
People are no longer automatically renewing their policies without checking online first. They are increasingly value conscious and expect more. So how do you stop these customers being tempted by the competition? How can you avoid being seen as a commodity?
The answer is that you must make each customer feel that you are providing them with a valuable service all year-round. Do this and they're much more likely to remain loyal to you.
Customer service and regular, valuable marketing communication needs to be a major part of your competitor advantage.
Put together a plan on how you can keep in touch with as many of your clients as possible, as often as possible. Maintaining a dialogue using email or social media isn’t time consuming - and is almost always cost effective. Share valuable risk management advice, topical news stories - anything that you know that will help or be of interest. Position yourself as a trusted advisor.
Focus on making your customer base your most valuable asset and your business will grow at the expense of your competition.
Your action plan
- Divide your customers into groups with different needs.
- Pinpoint the ones who may be about to leave you.
- Develop a plan so as to keep in regular contact and add value to your customer service.
- Incorporate your referral strategy into your plan (but remember that good customer service does not automatically convert into referrals).
- Incorporate your cross-selling/upselling strategy into your plan into your plan.
- Consider recontacting your previous, lapsed customers (who are usually relatively easy to recruit)