Use Your CRM to Create Long-Term Customer Retention

[vc_row][vc_column][vc_column_text]In the last few blogs, we have focused on the best ways to implement your CRM and expand its use from customer prospecting to service delivery and retention. We encouraged you to engage your team in the process as they touch your clients over your clients’ lifecycles and have the greatest potential to enhance your customer’s journey..

In some industries, closing sales is the easy part and retention is difficult. In other industries, retention is easy but converting a prospect is hard. Either way, it is important to use your CRM based on your business goals and have CRM actions for customer retention, service delivery, and prospecting. Certain industries sell recurring services (i.e. tax return services) and some (realtors) sell to a customer only so often. In each case, your CRM, when set up to achieve your business goals, can focus on each of the 3 key areas.

Customer retention strategies educate and nurture your customers to build long-term loyalty to you and your brand. That long term relationship produces greater profits each year as you expand your customer retention actions.

In our most recent blog about enhancing your customer’s journey, we illustrated the concept with a story about Just the Right Temp HVAC Services owned by Joe. We shared how the company was more successful because they used their CRM for the entire customer journey from qualified lead to install and customer service. Let’s continue this story.

Joe has two types of customers: Residential property managers and homeowners. Property management firms use Joe’s company for routine maintenance, installs, and emergencies. The Homeowners call only when an issue arises like a broken furnace and no heat. Joe’s teams tackle both needs but their approach is tailored by type of customer.

Joe’s service technicians talk to the property managers on a regular basis and have built their relationships around reliability, punctuality, and expertise. The interaction is recorded in their CRM and Joe and his technicians recommend service schedules based on the problems they see. In the past, Joe responded to homeowner requests with the same reliability, punctuality and expertise but did not have ongoing interaction with his homeowner customers. They were out of sight, out of mind, more of a one-and-done customer. Joe entered them in the CRM but really did not stay in touch with them.

This is where we would like to share insights about customer retention. How did Joe use his CRM to nurture and turn his one-and-done customer into a loyal customer beyond emergencies? We are going to look at a few CRM customer retention strategies that Joe used to increase retention and sales with his second type of customers.

Segment and Personalize Communication.

Many companies use their CRM to automate communication. This is very good. However, they may fall short by communicating the same message to everyone. When this happens, customers who do not relate will stop paying attention. After all, why would they pay attention to an offer or message about multi-unit housing maintenance when they own just one home?

This is where segmentation becomes important. Joe segmented his customers based on customer type. He then created personalized, automated messages to speak to his residential homeowners such as maintenance reminders, seasonal tips, and personal greetings like birthdays. His homeowners started to pay attention to emails and texts because when the message was relatable to them.

Product Introduction

Joe realized that he needed to sell residential service contracts to his homeowner community to build a recurring stream of revenue. He decided to use an educational campaign that sent emails to his residential customers every month about their HVAC system and how to save money using its features. At 9 months after installation, the email content changed because warranties were due to expire in 3 months and Joe wanted to assure his customer base that he was there for them.

By consistently messaging, Joe built customer confidence and demonstrated that a service contract will reduce customer risk and provide peace of mind to the homeowner. Very quickly, Joe began to get requests for service contracts and, today, 30% of Joe’s revenue is service contracts with homeowners.

Joe schedules service visits with his techs using the CRM’s calendar function and sends emails automatically to schedule service appointments. Each tech completes the service request and adds details to the service record for each customer. At any time, Joe can see who has performed what service for each customer and can touch base with customers to ensure thir satisfaction

Customer Loyalty and Referral Program.

Joe has always had a customer loyalty program for his contractual customers, but did not for his residential customers, because most of them only called for an emergency. It always was one-and-done until the next catastrophe. Not anymore! Joe instituted a customer referral program with incentives. Make a referral and receive free filters for 90 days. Joe delivers 3 filters that cost $4 per filter and his average sale on a referral is $300.00 – His client acquisition cost was 4% of the sale. Joe promotes the referral program in his monthly emails and now generates 20% of new revenue from existing customer referrals. There are many plans in Joe’s future relating to discounts for Spring and Fall checkups, 10% off service calls, and 15% off new installs or equipment. Now Joe is building loyalty with residential customers using a referral program with real benefits.

Ask for Feedback for Improvement.

Lately, Joe’s been thinking about surveying his customers. Feedback can be scary, because it seems that feedback is more negative than positive. No one likes complaints, but complaints along with praises can be a great marketing tool. Surveys and questionnaires are most effective when they are tailored to each customer type. By having tailored surveys, Joe can address the complaints and praises appropriately and effectively improve the experience for all customers. He can track the complaints and praises in his CRM with the goal of complaints decreasing and the praises increasing.

Although Joe’s company, Just the Right Temp HVAC Service, is an AC and heating company, the strategies he puts in place for customer retention can be used by all of us. Do you have different types of customers in your CRM? Are you segmenting your customers, so you can effectively reach them with relevant messages? Are you using your CRM to manage loyalty programs, incentives, and feedback? These are questions we all need to ask. If you would like to talk about this further and learn how you can implement customer retention strategies using your CRM, please reach out to us. We would love to help you. Call us at 301-332-0613 or fill out the contact form.

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