Getting New Customers at the Expense of Current Ones

Are you a fan of “new customer only” promotions? An email showed up in my inbox from someone promoting a system for generating cash flow. One of her ideas is to use “become-a-new-customer offers.” That may be a great way for businesses to entice new business through the door, but I also think it’s a great way to alienate the clients you already have. And as you know, no one is more valuable than your current clients!

Here’s why I don’t like most new customer only offers. As a consumer, if I’m already doing business with a company and I see they’re offering new customers a better deal than I’m getting, I feel ripped off; what am I, chopped liver?

I’m reminded of the story about the man who was finished with life on earth and was deciding between eternity in heaven or hell. He visited heaven and it was beautiful and peaceful. Harps were playing and everyone was laid back and mellow – just like he’d always heard it would be. Then he visited hell and it was an all out party with dancing and laughing. Everyone was enjoying fun adventures and he was treated like a rock star. Not at all the horrible place he expected! He goes back up to heaven and tells the angels he’s decided that hell looks like more fun and he’s going to go there. He returns with his commitment to hell and finds the scene desolate. He’s sequestered in a hot, musty cell where loud screeching sirens go off every two minutes. What’s going on here, he asks. Yesterday was a big rockin’ party! Where’s all the fun? And he’s told, well, yesterday you were a prospect; today you’re a client.

There’s nothing inherently wrong in creating “check out our service” offers to entice potential clients to give you a try. The problem is when you’re not concurrently making efforts to let current clients know how valuable they are. If you’re able to balance the two, and your existing customers feel confident they’re getting the best service, value and deals, then continue on with what’s working. If you’re seeing a revolving door of people taking advantage of the new customer offer and leaving shortly afterwards, you might want to put a bit more investment into strengthening the relationships you have with your current customers.

Customer Service as a Key Strategy

There was an article I saw posted last week on AdWeek.com written by Joseph Jaffe about customer service being the key strategy for businesses now. This is not news to me, but it is exciting to find other people talking about it more and more these days.

Unfortunately, the idea that businesses should focus on reaching out and creating memorable customer experiences seems ridiculously too simple for a few readers. Some of the comments posted in response to Mr. Jaffe’s column surprised me. People (viciously) accused him of stating the obvious and repackaging an old idea. Um, yeah, it’s kind of an original tenet of building a successful business. The point is, with all the “new” tactics and strategies that have come along in the history of marketing, none better contributes to a strong business than fanatically servicing the customers it already has. Furthermore, it seems that the majority of businesses operating today have forgotten the importance of true customer service. So perhaps he is saying something that many consider common sense, but then again, you’ve no doubt heard how common sense is not so common.

And so as is asked in the article, what would happen if you switched around the proportion of marketing budget spent on customer acquisition vs. customer retention, thus making what you spend on your customers comparable with their investment in you? Maybe then you would experience a stronger, more loyal and growing client base combined with increased revenues.

Holiday Gift Giving for Small Businesses

Congratulations to the 47% of small business owners who intend to give gifts to customers this holiday season. And even more kudos to the 10% who say they are increasing their gift giving this year, in part to use this as an opportunity to win over more customers.

Regardless of what’s going on “in the economy,” your customers want reassurance that you still value their business and that your company is still around and functioning. Now is not the time to cut back on client appreciation; now is the time it’s more important than ever!

Among business owners who are giving gifts, one in four said they’ll continue to give holiday gifts to customers because they have done it for so long it would seem strange to stop now. The top reasons business owners will give gifts to clients, include:

• To say thank you (82%)
• To celebrate the season (38%)
• To stand out from the competition (25%)

While all three of these reasons are great, from a marketing standpoint, the third is significant. Since so many people have decided the can’t or don’t want to recognize their clients this year with holiday gifts, the ones who DO choose to make the effort will certainly stand out from their competition. That is a move that will pay off down the road. Customers will remember who was still reaching out to them in 2009, when others were retreating in fear.

Of course you want to be sensitive to the times; lavish and pretentious is so 2006. But gift cards, plants, and making a donation to a charity on a client’s behalf are very acceptable this year. And food gifts are always a good choice because while some people may not drink wine or liquor, everyone can enjoy either eating or sharing a gourmet package. Tie in the gratitude theme, as the Cookies and Chocolate Sauce package does, and you’re good to go!

The statistics shared here come from the American Express OPEN Small Business Holiday Monitor, an annual survey of business owners conducted since 2002.

It’s Customer Service Week

Seriously, they have a week for this? I guess it makes sense, there’s a week for everything else. But shouldn’t EVERY week be customer service week?

If you’re so inclined to celebrate, I recommend doing something extra specially nice for your customers. I mean, only if you like them, and want them to continue supporting your business.

A few ideas:

1. If you have face to face contact with them (kind of a rarity anymore, huh?), look them in the eyes and tell them how much you value their business.
2. Send out a handwritten note to say thank you to each of your clients.
3. Go to www.ZenRabbitCookies.com and order boxes of Gratitude Cookies or bags of Zen Crunch to show your immense appreciation for their loyalty.

If you have a staff of customer service reps in your business, take a cue from my new Twitter friend at Business & Legal Resources (@BLR_Inc). They compiled a bunch of stories from the front lines that will have you shaking your head at the ridiculousness of some people. Check it out here.

Got any good customer service stories of your own? SHARE with us by posting a comment!

Leading a Tribe

Seth Godin is looking for leaders. In his latest book, “Tribes,” Seth claims there’s a “vast shortage of leaders” at a time when it’s never been easier for people who want to make a difference to do so. To become a tribe leader, “all you need to do is motivate people who choose to follow you.”

Cool. So I’m seeing massive opportunity in front of me and for you too. What are you passionate about? Find others who are passionate about the same thing and lead them in creating change, in making a difference in the world. It’s human nature to want to belong, to fit in. And right now, with the Internet and social media, it’s easier than ever to find others who will join you in whatever quest you’re on.

Personally, I’m building a tribe to change how people relate to each other in business and personal life. I’m building a tribe that understands the importance of sharing gratitude, of appreciation marketing, of recognizing the contributions of others to their success. Not everyone will want to be in my tribe, nor is everyone is even qualified to join. But for those who do and who are, we will impact the lives of millions by creating stronger relationships and helping others feel valued.

What tribe are you leading?

Some Customers Are More Equal Than Others

A friend recommended I speak with his college roommate, Sam*, about how Sam’s company handles customer appreciation. By all outside perceptions, Sam’s company fell exactly within the demographics of an ideal Zen Rabbit client.

But after just a couple of minutes on the phone, it was clear that Sam is currently working in contraction and fear mode, you know, because of the economy. Futhermore, Sam didn’t seem to understand the lifetime value of his clients.

I pointed out to him that even though he said he has thousands of clients, he’s likely getting 80% of his business from 20% of them. He agreed. Then I mentioned that he should be focusing his efforts on keeping those 20% really happy. That’s where he got a little fuzzy. Even though he “knows that,” he still wants to keep ALL his clients happy and not play favorites.

Hey, I can understand wanting to keep everyone happy, but like in the classic book “Animal Farm,” some customers are more equal than others. That’s just how it is. Some clients are more valuable than others. And you would do well to focus on and cater more to those 20% who bring you the most valuable business.

Sam admitted that he does not have a plan for consistently showing appreciation for his best customers. But he doesn’t quite believe that it would be worth the effort. I got the impression that he prefers to “fly by the seat of his pants” in that regard. It depends on whether there is money left over for it at the end of the month. It’s an afterthought.

But what if Sam DID believe in the power of saying thank you to his clients? What could his business look like then? I know for sure that his company would be a lot stronger, that he wouldn’t be so afraid of what’s going on in “the economy.” That he wouldn’t have to compete on price. Too bad Sam’s not ready for that message yet. Are you?

*names have been changed to protect friendships.

Zen Rabbit Really IS A Cookie Company!

Okay, Okay! I know. It’s been several weeks since a posting. Now we’re in the new year and I’ve turned over another new leaf. Look for more frequent postings here at Rabbit Rouser Online.

I had a revelation last week that is probably not so shocking to the rest of the world. As it turns out, Zen Rabbit actually IS a cookie company. Yes, Zen Rabbit still is a marketing company, as I’ve always claimed. But what Zen Rabbit is actually marketing is cookies. Yes, the cookies are still a tool for businesses to say thank you to their clients and referral sources. But what I learned this past holiday season is that you, the clients and recipients of Zen Rabbit, really just want the cookies. You appreciate the nice packaging, but in the paraphrased and twisted words of the Kinks holiday song, “Father Christmas, give us the cookies!”

And so in 2008, Zen Rabbit moves into the world of gourmet food stores. I’ve got packaging ideas to test and retail stores from Whole Foods to Fresh Market to Sutton Place Gourmet to contact. In what store would you like to see Zen Rabbit cookies? Let me know.

The World’s Greatest Marketing Seminar

October was a crazy busy month. Even so, I can’t believe I haven’t posted anything on Rabbit Rouser Online in a MONTH! I offer no excuses, but would like to share with you what I’ve been doing that kept me from writing.Mid month, I attended the “World’s Greatest Marketing Seminar” in Los Angeles. What a fabulous and very intense 5-day learning experience! Teachers included seminar host T. Harv Eker, Alex Mandossian, Bob Burg, Chet Holmes, Jay Abraham, Joel Roberts, Rick Frishman and more. My head is still spinning from all the ideas I intend to put into action in the coming weeks. Create a formal referral system! Develop a frequent buyer program! Find appropriate joint venture partners! Implement a consistent online marketing program!Stay tuned for more details as each of these tasks gets into process. And if you have experiences in doing any of these things and want to share your stories, please, let me know. I want to hear. Furthermore, if you have a list that you think would benefit from the Zen Rabbit Appreciation Marketing approach, definitely contact me and let’s talk joint venture.