Building Loyalty and Customer Retention for Under Two Dollars
The buzzword for this week is “branding.” Last week it was “Brand Loyalty.” Oh yeah, and the buzz-acronym for this week is “CRM.” Customer Retention Management. What crap.
What? Do you new guys on the marketing block think we old guys didn’t know what we were doing ten, twenty years ago. Do you think we didn’t know how to keep a customer? So you came up with a new name for it, am I supposed to be impressed? Hell, there’s even a “Branding” magazine now, and a preachy new “CRM Magazine.” Ooooh. Look what’s neeeew. Excuuussseee meeeeee.
You want to see a good example of CRM, take a look at L.L. Bean. They’ve been around forever – and they keep their customers… for life. They’ve been marketing extremely well without all the new buzzwords, thank you. And I assure you they’ve been around a lot longer than any new fangled “Customer Retention Management” scheme.
Shamefully, most big companies today actually do need to study “CRM” – cause they don’t know shit about keeping customers happy. Just take a look at Sprint, or AT&T, or any of the big phone companies. You get their worst prices if you’re a loyal, long-term customer. Exactly what were those connivers thinking to concoct that plan? Then, call them with a quick question… and get… 20 minutes of voice mail. Finally, they blow you off to their website so you can spend four hours looking for something it would have taken them 30 seconds to answer on the phone. I wonder if there’s a secret publication called Anti-CRM Magazine that only the phone companies – and credit card companies – receive? And banks. And TV Cable companies…
Yeah, so the phone companies have got to read up on it. They lose so many people on the back-end that they have to continually market on the front-end to stay ahead. I guess they haven’t figured out that it costs about one fifth as much to keep a current customer as it costs to acquire a new one. Heck, they could blow their marketing costs out of the water if they could get their fingers out of their noses long enough to write a few thank you letters. But I’m getting a little ahead of myself.
If you ask me, and some firms do, the way to keep customers is with good old-fashioned honesty, and some good old-fashioned service. (I know, it’s quite a stretch for some of the phone companies!) You answer the phone when it rings – with a real, live person. You don’t tell customers the crap about “…to give you better service the phone call is being recorded.” Yeah, right. And here’s three more quick lessons: You build a brand by providing good value: first quality products and services. You build customer retention by asking customers if there’s anything else you can do for them – then doing it. And you create loyalty when you thank them sincerely when they buy something from you.
When you do all this on a regular basis, do you know what you get? Presto! Customer Retention. You develop a customer who keeps buying your goods and services. Poof! Brand Loyalty. And a customer who tells his friends about you: Bingo! Company Loyalty. And more business. Zap: instant low cost and effective marketing—done for you by your other customers.
And now, I’m going to tell you how to get all these things for under $2. First, you send me two dollars and… just kidding. Send me twenty bucks. Oh, all right, I’ll tell you… You do it in a letter. You can send me the twenty bucks later.
A letter is the most effective single sheet of paper in direct marketing. It has been since I started my direct marketing career way back in, well, never you mind; and it will be long after I finish this column, which right about now will have to wait until after I finish clearing out the bowl of this bong with a lighter. Wait, did I say that out loud? I thought I was just thinking that. Yes, and a letter will still be the most effective tool in direct marketing way after The Simpsons shows its final episode. Well, maybe not The Simpsons.
What makes a letter such a powerful tool? And how do you create one that has this kind of effect? It’s easy – I’ll show you.
In direct marketing a letter isn’t really a letter. A letter is something you write to Aunt Bertha at Thanksgiving so you get a nice gift at Christmas. In direct marketing a letter is really a one page highly stylized ad designed to look like a letter. Any arguments? But we’ll call it a letter.
When you sit down to write a letter the very first thing you write is… the objective. What do you want to accomplish from this letter. If the letter goes perfectly according to plan, what will the immediate result be? That’s the objective. Draft your whole letter around that.
Take this quick test: take a look at most of your correspondence. What’s the objective? Most people are probably saying it’s to generate a sale; unless you’re a lawyer – in which case it’s to sue some poor bastard. Except for a few, nasty bunch, aren’t they? Well, I guess that pissed off all the lawyers who are now either not reading the rest of this column or who are busy figuring out if I am liable for the above heretofore, or… are already preparing to send me a notice of suit. Good riddance to you. Do you know what you have when you have 8 lawyers buried in the sand up to their necks? Not enough sand. (Hey, just kidding, can’t you guys take a joke?) Some of my best friends are, umm, ok, never mind.
So you create letters to sell. Sell sell sell. Sell products, services, appointments, sales calls. Right? OK, now those of you who shook their heads yes, reach out and smack yourself upside your head. Unless you are a direct marketer and your customers read your letters and directly send you money with an order, your real objective isn’t to sell your product. People don’t read your letter and send you money. The real objective is to generate a phone call. Your letter simply makes the phone ring. When the phone rings, the letter worked – perfectly. It fulfilled the objective. Then it’s your job to sell something. BTW, how’d you do on that test? That’s OK, I don’t test well either. But wait, there’s more…
Now let’s talk about writing a letter to a very different objective. How about creating a letter to keep a customer? A letter to build loyalty, trust, and friendship. Yes – all rolled up into a single sheet of paper. It’s pretty easy to do, here’s how: just write a thank you letter. “Thanks for your past business – I appreciate it.” There, that wasn’t so hard, was it? Instead of trying to sell something, take a minute out – spend the half a buck on building a customer relationship. Use a letter so powerful it’ll sit on a client’s desk for a month: send a simple thank you. It’ll be the best 50¢ you’ll ever spend – and I guarantee it.
Let me ask you: When’s the last time you personally received a thank you letter? That long ago, huh? No, I’m not talking about the pre-printed junk card your accountant bought from a catalog and sends you each year at Christmas. (OK, there go all the accountants calling their lawyers asking about a class action suit.) I’m talking about a real letter – one you’ve actually received from a real person, that said your name right there up at the top, and continued, “thanks, thanks so much for your business this past year – I appreciate it.”
Call me old fashioned, but I still believe it’s a privilege to serve your customers. I’ll bet they could go just about anywhere to buy services and products exactly like the ones you sell. But they don’t – they get them from you. When’s the last time you thanked them for that privilege? That long ago, too, huh? Do you know what other vendors call your best customers? They call them valuable prospects.
With a single thank you letter you can turn your best prospects into customers; you can encourage your best customers to do even more business with you, and feel better about doing it. Yes, they’ll feel great about spending even more money with you – all from a single letter that was written with the objective of making them feel great about doing business with you. “Thanks for the business you give to us – we appreciate it. We’re always ready with help, to answer your questions, and to assist you in any way we can, at any time. Thank you.”
With two, well-written “Thanks for your business” letters, you can endear a person to remain your customer for years. You can plug that hole in the bottom of the customer bucket – you know, the one they keep falling out of.
And with three letters, with three thank you letters you can make a customer fall in love with you, your company, and they’ll never even consider going anywhere else. Your letters need to say… oops, I’m out of room here – give me a call and I’ll send you instructions for the third letter. Or send that twenty bucks you owe me and I’ll send you the next article in this series on creating letters.
Back to Main Article Pages
Word Count: 1700
Jeffrey Dobkin, author and speaker, is a specialist in direct response writing. Sales letters, TV commercials and scripts; persuasive catalog copy; and exceptionally hard working letters and direct mail packages. He also analyzes direct marketing packages, ads, catalogs, and campaigns. After 25 years experience in direct response, Mr. Dobkin is also a pretty effective marketing consultant who can spot a hole in your marketing campaign from your parking lot. Call him directly at 610-642-1000 for free samples of his work.