How to Build and Maintain a Customer-for-Life Philosophy in Business
If you want a sustainable business, predictable revenue, less costly acquisition engine, and shortened sales cycle and lead times, create a business that lives by the customer-for-life philosophy.
According to a study conducted by Marketing Metrics, the success rate of selling to an existing customer is 60–70% while the probability of selling to a new customer stays between 5–20%. This data shows how existing customers are much more valuable than new prospects.
Creating and maintaining a customer-for-life philosophy in business entails more than focusing on customer experience on the frontline. Here’s how you can successfully and sustainably run a business with a customer-for-life philosophy:
1. Start with the customer lifecycle.
Every business has to do pre-sales in a customer lifecycle, from the point of awareness to contract signing. Then, each business must deliver what it is they sold (what we call post-sales, from contract signing to product/service delivered).
Not every business goes through the second half of the customer lifecycle, which is follow-up and repurchase. But if you want customers for life, you must close the loop by following-up and repurchasing in order to maintain your customers.
The customer lifecycle is how we started every Toyota initiative in any dealership around the world because if you don’t believe in customers for life, there is no reason for process improvement.
Layered on top of process improvement is the belief that if we incrementally improve the processes across the customer lifecycle, then over time we will create customers for life.
2. Create a process-based culture.
Most companies do not see the value of improving their processes unless something bad happens. In a process-based culture like Toyota, instead of waiting until the ball drops, you make small changes to improve your processes across the entire customer lifecycle. This is why Toyota leads their…