Counselor Magazine March 2012 : Page 102

CUSTOMER LOYALTY Build a Client With price a concern for many buyers today, customer loyalty is being tested like never before. Here’s how to ensure repeat business. By Alex Palmer 102 MARCH 2012 www.counselormag.com

Build A Loyal Client

Alex Palmer

With price a concern for many buyers today, customer loyalty is being tested like never before. Here’s how to ensure repeat business. Here’s when you know you’ve created a loyal customer base: when clients become an issue in planning your wedding. Such was the case for Mercedes Castro, owner of Proforma Quality Printing (asi/490049). Castro has owned her distributorship franchise for 12 years, but it was eight years ago when she – and her husband, for that matter – fully understood the depth of loyalty she creates among her customers. In planning the wedding, Castro started to add up the number of client contacts she wanted to invite. She quickly realized that she would need tables – multiple tables – at the reception to accommodate the numbers. “My husband couldn’t believe it,” Castro says. “I had four tables of just my customers.” Now that’s loyalty – and Castro knows the positive impact that those kind of deep relationships have on her business to this day. “I really become friends with a lot of my customers,” she says, “and it’s harder to fire a friend.” Yes, it is. Distributors know that the more loyalty they can create among their customer base, the better off their businesses will be overall. However, finding this level of devotion can be difficult in a time when customers can be more educated about promotional products than ever before. Plus, their ability to identify low-cost providers online is challenging the relationships that distributors have with clients like never before. Indeed, strengthening customer loyalty is at once the simplest and one of the most challenging ways for distributors to improve their bottom line. The rewards of retaining customers for years or even decades are huge, not just in the amount of sales that loyal clients bring in year after year, and the referrals they often generate, but in the less tangible benefits of allowing distributors to work with a partner they know well and cutting down on the need for heavy customer-acquisition efforts. A focus on customer retention and loyalty offers clear benefits, and has been shown to require far less effort per dollar of revenue than customer acquisition. There are specific steps that distributors have found must be taken to successfully retain clients. Make It Personal While it is important for distributors to stay professional in all aspects of their work, that does not mean they must be all business all the time. An effective way for a distributor to retain clients over the long term is to connect with them on a personal level. This can begin as simply as asking them questions during the sales and prospecting process about their family and their interests. The companies that create the most loyalty among their clients have deeper personal connections with their contacts than other firms. Finding out about your clients personally helps to develop these relationships. Castro, who has continued to build on her customer loyalty even after her wedding, adds that she gets a dozen or so Christmas presents from her clients and is invited to their company parties and social events. While emphasizing her personal relationships with customers, Castro positions herself as someone with whom the client can casually discuss ideas, even in some cases when it does not end in an actual sale. Distributors can begin to develop these stronger connections by asking a few nonwork questions during their next conversation with clients, or adding a light-hearted personal comment to the next e-mail they send out. While some clients may not be receptive to personal questions, business experts and distributors alike say that more often than not they appreciate the overture. “You’re asking about situations outside of work, so that every time you speak to them it’s not always about product,” says Markita Harrison, owner of 4 Meetings & Events (asi/347937). “Over time the trust develops, and they feel comfortable calling you and asking for advice.” Make It Interesting One of the greatest challenges for distributors with clients that come back year after year is keeping the promotional products fresh and different. If a distributor has sourced the giveaways for a client’s trade show every year for the past decade, it may be tempting to just keep returning to the same product that went over well the year before. But suggesting a new idea or interesting variation on a traditional giveaway, even if the client decides to stick with the same product for another year, offers the benefit of showing them what other kinds of ad specialty items you can provide and reminds them that you’re working to help them improve their business. Ultimately, trust and loyalty are built over time, after a customer sees that a vendor can be a good resource for ideas. It takes more than just fulfilling orders and providing good service. Allegiance from customer to vendor is built through the sharing of ideas and concepts that will help the client build business. This is something that Susan Copperman, owner of distributor firm Careerlook (asi/157439), knows well. One of her clients is a local bakery chain in the Napa region. With an employee base made up mostly of people in their 20s, Copperman knew that they would be looking for uniforms with a stylish flair – something they might even wear outside of work. She eventually decided on a vintage pattern from District Threads. Though it was not a product the bakery owner would be making a decision on until March, Copperman showed them to her in January. “I want her to know that I’m shopping for her; I know I’m keeping on her radar and that someone else is not going to come in and take the business,” says Copperman. “Even if the customer is not ordering for three months, I’m thinking of the next season.” Recently, a longtime high-tech client of The Barr Group Inc. (asi/132970) that specializes in cloud technology requested a standard stress ball for an upcoming trade show. Instead of just going with the stress ball idea, Renee Murray, president and owner of The Barr Group, suggested they give away ones specially-designed in light blue with wisps of white to evoke the “go to the cloud” idea. The squeeze balls proved a big hit that thrilled the client, which plans to tap the company again for the items at the next trade show at which it exhibits. The Barr Group also ended up with a number of referrals from individuals who picked up the squeeze balls at the event. “We’re always thinking long-term,” Murray says, “so we can help the company promote itself and keep its own customers interested.” Gain Loyalty From The Client’s Clients Another major way for distributors to ensure client loyalty is to help their clients improve their own customer retention. Distributors can suggest strategies and promotional products to their clients that will keep their own customers coming back. For example, rather than one-time giveaways, distributors can work with their clients to create sets of collectors’ items. Instead of just promoting the free toy customers can win, the client can encourage them to “collect all five.” Rather than just giving away the same mug for years, a distributor can suggest the client print the year on each mug, or vary them in some other way from one order to the next, so that regular customers will be tempted to add the latest one to their collection. Copperman recently recommended that her bakery client use canvas tote bags that customers could buy or be given to carry their orders in. Customers who bring the tote bag in could then get a discount on their orders, encouraging them not only to keep coming back, but to help promote the shop by carrying the bag. “I got a sample and said, ‘Your logo would look great on here, and that will save you money – and people will carry your brand around with them,’ ” says Copperman. When a distributor works with a client on a program aimed at a specific goal, such as boosting customer loyalty, they must be sure, though, to incorporate follow-up into their interactions. Joanne Black, founder of the sales consultancy No More Cold Calling, and author of the book of the same title, says that often ad specialty distributors get too focused on offering the newest and flashiest products and overlook the importance of checking back to see the results. “Especially in promotional products, we don’t always have a process built in to stay in touch with our clients and to circle back with them to extract the business impact,” says Black. “Schedule in a follow-up meeting after the event and ask questions. Find out the response to the promotion; find the results. You have to extract tangible information beyond just the anecdotal idea that everybody loved it.” Discussing the results with clients not only ensures that the promotion was effective, but it also offers an opportunity to discuss how improvements can be made the next time. According to Black, the more a distributor can be seen as a marketing consultant rather than just a source for products, the more likely the client will be to continue using them. Stay Flexible Keeping clients over the long term means making adjustments to meet their needs. Seeking out ways to keep customers happy while not hurting the distributor’s own business can sometimes be a difficult balancing act, but the right amount of give and take will ensure solid business in the long term. This means being able to provide information about changes in the market and educating clients about how those changes are impacting the business. For example, during the cotton-price-shock that hit the apparel sector in 2009 and 2010, many apparel distributors had to make difficult decisions about whether to pass the extra cost along to their clients or absorb it themselves. Darlene Dando, owner of All Quality Stitches (asi/587757), found a compromise. “As soon as I heard about a price hike from my supplier, I would let the client know, ‘I’m going to keep it at the current rate until next year, though it’s already going up with the supplier,’ ” says Dando. “That actually gets them ordering more, since they want to get their order in at the lower rate, and they appreciate you letting them know.” It’s imperative today for distributors to keep up-to-date on these market shifts so that they can educate their clients and use the opportunity to help grow their customer relationships. In the case of rising apparel costs for Dando, rather than be completely concerned with whether she should raise prices herself, she looked at the challenge as a way to enhance customer loyalty. Distributors need to approach these kinds of situations by staying as open and flexible with their customers as possible. They should keep clients updated on news from suppliers and other industry sources as soon as they hear it and make it clear what they intend to do about it. Clients respect a vendor with clear and open lines of communication. Loyalty tends to break down when clients feel like they’re left in the dark, so make sure you’re always providing accurate and precise information on changes that impact their businesses and their purchases. Open Up Communication Lines Dando’s experience points to the larger priority for retaining clients over the long term. As is the case in personal relationships, communication is key. Barbara Schwab, a salesperson for Counselor Top 40 distributor Jack Nadel International (asi/279600), says she tries to meet in person with even her most infrequent clients at least twice a year. The meetings are meant to review her calendar of orders from the previous year for each client so she can time her outreach when that date approaches. The point to the customer is clear: Schwab clearly understands their business and knows their promotional schedule nearly as well as they do. “Last year on February 25 they may have ordered however many coffee mugs, so a few weeks before that I see if they want more, or if they want something new,” says Schwab. Copperman takes an even more ambitious approach to her regular communications. “Once every other month, I go through my whole address book and send a note to every single person,” she says. “I always end it with the line, ‘Look forward to hearing from you,’ and that usually gets an e-mail in return.” Speed is also important when it comes to communicating with clients in ways that will keep them coming back. “We try to respond within three to four hours of being contacted, which keeps the clients happy knowing they can count on us to be available even for last-minute orders,” says Murray. Setting up an after-hours response line or providing top clients with a number to call for urgent orders can further aid the sense that the distributor is always available when the client needs them. Ad specialty companies should also consider taking a more formal approach to their communications with clients, even sending out a two- to five-question survey at the end of each year asking for feedback. Nancy Garberson, CEO of Marketing & Communication Strategies Inc., a public relations and marketing consultancy, suggests to her clients that they regularly monitor what customers think about them in this way so they can catch concerns as early as possible. “If someone is saying something ugly about the company, you want to know it immediately,” says Garberson. “If you are working with someone intensely for a month, check in and see what they thought about the work you did.” If A Client Leaves … Of course, no matter how strong the relationship with the client may be, in some cases loyalty may wane, whether because of budget cuts or a decision made from top executives. But rather than writing off the client, it is worthwhile for a distributor to keep some kind of connection going with them. If a personal relationship has been forged, or at least a casual professional one, there is no reason not to keep that going, even if it no longer includes filling orders for the company. Castro learned that recently when one of her printing clients had to place orders with a lower-cost provider because of budget cutbacks. The new printer charged a much lower rate, and Castro had her doubts about whether her replacement would be able to deliver at the same level of service that she had. “I said, ‘When you guys needed something special, I just did it, but he’s going to extra-charge you to death,’ ” says Castro. It did not take long for Castro to be proven right. Besides a generally slow response time, the new printer frustrated the client over an order for business reply envelopes. These require approval by the post office, which Castro had typically handled on the client’s behalf, but working with the new person, two days before they needed the envelopes and still did not have them, the client gave the new printer a call. “He said, ‘When are you going to get that approved?’ and she said, ‘I don’t do that – Mercedes always did that for us,’ ” says Castro. The client decided to return to Castro’s company, thanks in large part to the fact that she had kept in touch with them even after they had moved on. It taught Castro a lesson that many distributors should know: Customer loyalty can be forged in many ways. Sometimes it takes a break-up to make it clear that the relationship was a good one in the first place. In this case, that’s precisely what happened. And, because of the consistent and open lines of communication that Castro had with her straying client, she was able to win back its loyalty – and its business.

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