First, they can call you again and purchase a repeat of previous services or schedule additional services.
Second, a satisfied customer will often refer friends and relatives. When you add these referrals up over the years, the total gives you a healthy respect for the true value of each and every customer.
The effect is like a pyramid—every happy customer refers three or four new customers, who in turn refer three or four new customers, and so on. In fact, most business owners who have been successful in the service business for more than five years consistently attribute more than 90% of their gross volume to the repeat and referral program.
Since it represents such a major portion of business income and stability, it’s important that you have a deliberate part of your business plan specifically designed to cater to this repeat and referral trade. There are three main parts to this type of plan: customer satisfaction, customer appreciation, and customer follow through.
While a happy customer will generally tell three or four other people about your service, an unhappy customer may tell as many as a dozen about their unpleasant experience. Remember, our goal is to get the customer to feel good enough about our service to not only call you again, but to recommend you to their mother. Don’t forget to let them know that referrals are appreciated.
By implementing a repeat and referral plan, you can increase the lifetime value of all your customers and build a solid business foundation. Another way of looking at this is that you are trying to change the “customer ”into a “client.” The key to this relationship is to continue and extend beyond just the buying and selling of a specific service or product. True success in this business is dependent upon relationships built through quality service, integrity, and reliability. Always keep focused on the “big picture” and remember the lifetime value of a client is more than just the amount of money they are spending today.