10 ways to create loyal customers

A growing business lives and dies by repeat customers or clients, especially in uncertain economic times like these. Studies show it can cost up to 10 times more to land a new customer than to keep an existing one. The problem is that most customer retention strategies are ineffective.

To make matters worse, according to Allegiance, a technology firm in Salt Lake City, the average business hears from only 4% of dissatisfied customers -- the rest just bolt.

Here are 9 1/2 ways how to get your customers to stick around:

1. Check in with your best customers. At least once a quarter, touch base with the 20% of your customers who generate 80% of your business to find out how they're doing. "You aren't trying to sell anything or be the bearer of any profound news, but are merely placing a courtesy call to convey a sense of calm and clarity," says Duncan MacPherson, coauthor of Breakthrough Business Development. As an extra personal touch, send a handwritten note.

2. Find out how you're doing. Robert Basso, president of Advantage Payroll Services in Hicksville, N.Y., regularly surveys staff to see if they understand the firm's customer-service strategies. He also talks to customers to make sure they're receiving the service they deserve. Surveys should be short, free of bias, and well structured, Basso notes.

3. Teach your employees well. Schedule a weekly half-hour meeting with staff to address customer care topics, such as how to deal with crabby or impatient customers. "A postmortem analysis on any customer interaction that doesn't go well can be an eye-opening exercise," says Lori Jo Vest, head of LJV Consulting in Troy, Mich.

4. Offer your expertise as a value-added service. "Remind your customers that you will make yourself available to answer questions that their friends or family members might have regarding the type of services you provide," MacPherson suggests.

5. Send referrals your customers' way. For customers who may own their own businesses, spread the word about their products or services, or offer to share resources if it makes sense.

6. Gift creatively. The best gifts for customers are those that subtly tout your services. New York-based Axis Promotions sent prospects and existing customers a "breakfast in a box" that included a plush blanket, a custom spoon, an original four-page newspaper loaded with custom articles, quizzes and puzzles, and a card that read, "Relax. We've got you covered." The innovative package resulted in more than $110,000 in orders from existing customers who wanted the items used in the mailing, or similar ones, to send as marketing promotions to their own customers.

7. Go the extra mile. Coastal Contacts, an online seller of eyeglasses and contact lenses based in Vancouver, British Columbia, includes an unexpected freebie with every purchase, such as a pair of sunglasses or a $10-off coupon good toward the next order.

8. Act fast when someone grouses. Research indicates that a complaint addressed with swiftness and creativity can turn a dissatisfied customer into a highly loyal one, notes Kyle LaMalfa, best practices manager at Allegiance.

9. Think long term. "Think of a new customer as the beginning of a long relationship where you are going to help them get what they want," says Tessa Stowe, editor of the Sales Conversation newsletter. Positioning yourself as a resource for life differentiates you from companies looking for a quick sale, she adds.

10. Share your know-how. Ben Chestnut, cofounder of MailChimp.com, a marketing services provider in Atlanta, suggests sending monthly e-mail newsletters to customer lists. "These aren't newsletters full of marketing fluff, but useful tips showcasing your knowledge and expertise. That's why your customers love you in the first place."