Article - Using Email as a Customer Retention Tool

Using Email as a Customer Retention Tool

Article by Steve Brewer

Staying in touch with past customers is a little like flossing your teeth: we all know it is important, but most of us don’t do it often enough.

As a result, we spend too much time chasing after new customers and not enough time making repeat sales.

Depending on which study you believe, acquiring new customers is anywhere from seven to twenty times more expensive than retaining existing customers. At the same time, there are more competitors then ever trying to take your existing customers away.

Personal and Phone Visits

In-person visits are the best customer retention tool because nothing beats personal relationships. However, it is impossible for some companies to visit their customers in person. Others simply cannot afford more than one or two personal visits per year.

Phone calls also work well, but many companies simply have too many customers to stay in touch regularly by phone. In addition, it is more difficult to reach people in this age of voice mail.

When to Use Email

Fortunately, you probably have a great customer retention tool on your computer right now - email. Used correctly and responsibly, email is a wonderful way to stay in touch with past customers personally and unobtrusively at a relatively low cost.

Email is not a substitute for personal visits or phone calls, but is a great tool to supplement other customer retention methods.

Here are some ways to use email effectively:

Collect the Address

When you close a sale with a customer, explain that your company sometimes sends out useful information about your products and services via email. Ask permission to include the new customer on your distribution list. You will need to explain how you will and will not use that email address.

If the customer agrees, collect the email address and add it to your database.

Personal Messages

A personal email a few days or weeks after a sale can keep your company "front of mind." Inquire about satisfaction, and give pertinent information such as warranty details, service phone numbers, or the name of the person to contact in case problems occur.

Email Newsletter

An email newsletter is simply a newsletter sent via email rather than on paper. Some contain links to articles on the company’s web site, while others include very brief articles on relevant topics.

Examples of content for an email newsletter are:

News about your industry
Changes and new products of interest to customers
Consumer education tips
Links to useful articles on other web sites

For example, a clothing store might include articles about the best ways to launder certain types of fabrics, results of a national survey about fashion trends and the new line of designer suits just added to the shelves.

The advantage of an email newsletter is that it is basically free to create and distribute. However, it should only be sent to those who have expressed interest in receiving it. Otherwise, it’s just another form of unwanted commercial email known commonly as "spam."

Flash Email

You’re a mortgage lender, and rates have just dropped two points. Maybe you’re a computer retailer looking to unload 15 laptops quickly at a great price. A flash email might be the right tool.

A flash email is simply an email message about a topic of importance that is sent to a large group of people at the same time. Because a flash email emphasizes quickness and urgency, it needs to be on a topic of real interest.

The fact that you’ve reduced prices 5% for a Presidents’ Day Sale is not a good topic for a flash email, unless you want everyone to immediately delete all future messages from you.

How Not to Use Email

Like all great tools, email is often abused by the unscrupulous. If you plan to use email successfully and morally, be sure to follow these guidelines:

Ask Permission - Consumers do not like to receive unsolicited commercial email about products or services they do not want. Instead, you should ask permission to send information. Receiving permission means you aren’t wasting anyone’s time, and your messages will be noticed and read when they arrive.

Respect Privacy - Technology makes it possible for companies to sell demographic and email addresses to other companies. Increasingly, consumers are saying they do not want this information shared or sold to other companies and laws are being passed.

We all know that retaining customers is important, but many of us do a poor job. Used correctly, email can help you stay in touch with customers and generate more repeat business and referrals. It’s not a substitute for personal contact, but it can be a fantastic addition to your customer retention efforts.

Want to use this article? Copyright © 2001 Steve Brewer. All rights reserved. This article may be used only for personal use. To reproduce this article in any way, you must obtain permission by contacting Steve Brewer. He can be reached at 952-417-9594 or by email at: sbrewer@eureka-marketing.com.