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My wife likes to shop at the local Safeway. Is it because of the competitive prices? Yes, that's part of it. Is it because of the convenient location? Yes, that's part of it, too. She also likes their produce department. But the biggest reason she likes to shop at the local Safeway is Marshall.

Now, Marshall is a very good checkout person. He's fast, efficient and seldom makes a mistake. But his competence is not the reason my wife keeps going back.

She keeps going back because Marshall always has a warm and friendly smile. And because when Marshall asks, "How are you today?" you know he's sincere.

You see, for those few minutes while she's a customer in his checkout line, Marshall makes my wife feel genuinely valued and appreciated. And week after week she buys our groceries at "Marshall's" Safeway.

Perfect Marketing Sense

As marketers, salespeople and business owners, very few of us will have the same weekly face-to-face opportunity as Marshall to make our customers feel valued and appreciated. And yet, if we're smart, we'll make sure we have our very own "Marshall" Plan in effect.

We'll make sure—once we've "rescued" our customer from the grips of our competitors—that we have a customer aftercare program in place to maintain the health and increase the profitability of that relationship.

This makes perfect marketing sense. With studies showing that the total cost of getting a new customer is 10 times that of simply holding on to an existing one, it can also make you plenty of dollars and cents, too. A 5% improvement in customer retention can lead to an 85% increase in profits. You don't have to be King Solomon to see the wisdom in those numbers.

Imagine for a moment that you work as a real estate agent or loan officer. A couple—first-time homebuyers—purchase their first home or close on their first loan through your company. Assuming that they are upwardly mobile professionals, they'll probably purchase another four or five homes during their lifetimes.

If you're in the lending business, that's another four or five loans at a minimum. If you're an agent or a broker, the potential exists for another 8-10 transactions (counting the sells as well as the buys). Even if the first-time buyers never send you a single referral, they are conceivably worth thousands of dollars to you during their lifetimes.

If you're actively working on this relationship… if you're putting forth a consistent and concentrated effort to make the first-time buyers feel valued and appreciated… then they will send you lots of referrals.

But without proper planning and execution, you won't come close to realizing a customer's full lifetime value—whatever your industry.

The Key: Good Communication

The key to increasing your "share of customer" and maximizing "lifetime value" lies in continually strengthening the bond between you and your customer. It's no surprise that good communication plays a major role in this bonding process.

An organized and consistent communications program will keep you in touch with your customers on a regular basis—and increase your top-of-mind awareness (TOMA) with them. Plus, by welcoming and encouraging their feedback, you'll be reminding them how very important and very special they are to you. And we all like to feel special, valued and appreciated. We all like to feel "loved."

In a magazine article a few years back, marketing consultant and author James Rosenfield wrote, "Every customer relationship begins with something that looks like love." Your objective as a marketer or sales executive is to move your new customer beyond "something that looks like love" to the real deal.

Ideally, you want to turn each new customer into a walking, talking, word-of-mouth advertisement for you, your products and (or) services. And a proactive, "customer aftercare" letter program can go a long way toward achieving this ideal.

Since most of us, unlike Marshall, don't usually have the opportunity for weekly personal contact, direct mail is an efficient and effective customer retention tool. Here are a few examples of the type of communications that should be in any good Customer Aftercare program.

  • "Thank You" letter: To be mailed the very day the sale is closed. Sure, this is something we all do—right? Well maybe all of us do it—but I know from experience that a number of those others don't!

  • Letter from "Mr./Ms. Big": To be mailed 10 days to 2 weeks after the account is opened. In a smaller company, it should come from the owner. In a larger company, a senior manager. This letter is a warm owner/senior management welcome and also informs the new customer that, ultimately, "the buck stops here."

    Sample wording. "If the product or products you've purchased, or anyone in my organization, fails to meet with your complete approval—now or in the future—I would like to know about it."

  • How did I/we do? Mailed a week after the sale. It's a friendly letter explaining how important honest feedback is to you because it's the only way you can improve. Attached to the letter is a brief customer satisfaction survey and stamped return envelope. The feedback you receive from this survey will be of tremendous value to you in your ongoing marketing efforts. It will help you make more sales and generate increased profits

  • Happy anniversary: Sample opening: "It's been a year (__ years) since you opened your account (closed on your house, closed on your loan) with us. I just wanted to say Happy Anniversary and thanks again. We look forward to working with you for many more years to come."

  • At random, customer appreciation letter: Sample opening: "Do you ever get so caught up in the mundane, everyday responsibilities of your job that you sometimes overlook things? I know I do. And that's why I'm writing you." From that point you go on to tell your customer how much you value and appreciate them and their business.

    Don't do any selling in this letter. Helpful hint: Mail this letter right before you know your customer will be in contact with a large number of people—for example, right before Thanksgiving or before a trade convention or industry gathering. This way, you'll get maximum mileage from the positive word of mouth that this letter creates.

  • "How are we doing?/How have we done?" survey cover letter: You should regularly survey your customers, at least once a year. Just the act of sending out the survey sends a message about how important they are to you. But the greatest benefit to you and your business is the feedback you'll get on how you can improve. So, word your cover letter in such a way that it will encourage response.

    Sample copy: "At ABC Widgets, we're committed to offering you the affordable high-performance widgets backed up by a level of service that sets the standard for the industry. Your feedback is of tremendous help to us in measuring how well we're meeting that commitment." The survey, whether or not they return it to you, is one more indication that they are important to you.

  • Birthday cards: It used to be that if you visited any Petco store, you'd find forms to fill out with your pet's name, address and birthday. Complete one, and during the month of your pet's birthday Petco would send your Fido or Mr. Whiskers a birthday card and an invitation to come to the store and get a 10% discount.

    Shouldn't we treat our human customers with similar care and thoughtfulness? I think you know the answer.

  • Hand-written "Congratulations" cards: Whenever you or your assistant read or hear about awards, appointments, promotions and other forms of recognition earned by your clients—or their children—acknowledge this with a letter or card. This is a small thing to do, but it is greatly appreciated (and will pay big dividends).

  • Thanksgiving letter: What better time to show our thanks and appreciation to our customers than right before a national holiday dedicated to being thankful and appreciative? One client I sent my Thanksgiving letter to liked it so much that he insisted on paying me for it so that he could adapt it and send it out to his employees and customers. (For a copy of this letter, send me an email to enicastro@positiveresponse.com with Thanksgiving Letter in the subject line.)

    As Thanksgiving is traditionally the start to the holiday season, another benefit to this letter is that you can work in your holiday greetings and best wishes for the season. This way, you'll be among the very first to do so and your sentiments won't get lost in the deluge of Christmas cards and Season's Greetings that will come pouring in later.

In addition to the above communications, you'll also be sending out your normal promotional mailings and regular reminders of the benefits of doing business with you and your company. Plus, you'll also want to send a quarterly newsletter.

With the inexpensive database marketing technology available today, there's little reason for any company not to have a well-thought-out, consistent and clearly defined customer aftercare program. There's only one drawback—it's not a "quick fix" for low sales. But the benefits are many, including maximized customer retention and loyalty, reduced marketing costs and higher profits.

Most important, your customer aftercare program will set you apart from the vast majority of your competition. And give you the competitive edge that leads to higher sales and profits.

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ABOUT THE AUTHOR
image of Ernest Nicastro

Ernest Nicastro is an award-winning B-to-B freelance copywriter who is also equally adept at crafting B-to-C content. For more information, and to review samples of his work, visit Positive Response.

LinkedIn: Ernest Nicastro

Twitter: @enicastro