by Murray Barton http://incommunique.blogspot.com Every-one knows that it is easier to keep an existing customer than it is to get a new one but how far does this thinking go in your business? Have you empowered staff at all levels of your business to think outside of the box in order to keep your existing customers and keep them happy? Especially in the current economic times every customer you don’t have a marketing cost to obtain is money on your bottom line. Let me give you a recent example from an industry which is likely to be one of the hardest hit from the economic down turn; the travel industry. My partner Lisa and I, recently booked a trip through a large travel agency in Australia. We booked flights and accomodation through the travel agent. We trusted them as experts to get us a good deal on the best flights and good accomodation. When we got to our hotel it wasn’t everything we had expected but it was OK. Then when we found ourselves needing an extra night in the same city we booked an extra night at the same hotel. That was when we got our first shock. The hotel charged us $150AU a night less than the travel agent had charged us. That’s a bit more than a reasonable markup and over three nights turned into a not inconsiderable sum of money. When we got back home, we went to the travel agent and asked why we had been charged so much, when we could have got a cheaper deal ourselves. The travel agent immediately trotted out a list of reasons why there was a price discrepancy and how she had got us the very best deal possible. We were neither convinced nor happy and were eventually told to call their complaints number. The first thing we were told by ‘Complaints’ was “we regularly sell accomodation for $300/night which you can buy online for $100/night”. Not only had we paid way too much for our accomodation but the travel agent whom we had trusted had known we were paying too much when she sold us the accommodation. She also knew we had paid over the top when she gave us the long list of justifications as to why the offer was the best deal possible for us. In short, it was a public relations nightmare and I have told everyone I know not to go to that travel agent for bookings because they do not look after their customers. But it could have worked out very differently. Imagine the increase in customer loyalty if the same agent had told us at the time of booking “you can save yourself quite a bit of money if you book this yourself online”. She would not have got our accommodation booking that time, but she would have got our air flight bookings then, and in the future, and we would have told everyone we knew to go to that travel agent because she was honest and looked after her clients. Even after the fact there was much they could have done. If a customer goes to the trouble of coming into your business to complain then it’s because they trusted you and felt their trust was betrayed, it is an opportunity for them to put things right. It’s never just about the money. Who in your business will stop and ask “how can I keep this customers business now and in the future?”. Short of a full refund what could have made a difference? An empathic approach and an apology are a great first step. Then they could have offered travel and accomodation vouchers or discounts, something that gives the customer more value than it necessarily costs the business, perhaps giving up some margin, but causes a repeat sale to redeem. “Look I know this isn’t as good as a refund but we have a special on flights and accomodation to Bali if you fly before May and we can reduce the price by a further 10%” saving you a little bit more than the accomodation cost you”. This sort of approach won’t work with every customer, it might not have worked with us, but when customers are expensive to get and usually cheap to keep it makes sense to have all of your team empowered and looking for ways to keep every one of your customers.