"The principal purpose of business is to create a customer." --Peter Drucker

Creating a loyal and respectful relationship with a potential customer builds the basis for all other areas of business success.

Simply stated, without customers, our businesses would all fail.

A satisfied customer is a customer who provides a continual income stream and refers others.

Business success starts with the customer. The following six strategies outline the best and most effective business success practices.

1. Customer Service. Typically 68% of a business' customers leave or go elsewhere for products and services because they feel they are under appreciated or unimportant.

The perception a customer has of his/her value to a business plays a very large role in whether or not the customer returns.

What can you do to improve on that statistic? Smile, ask questions, be friendly and say "Thank You".

Customer service is a seriously neglected facet of most businesses. As an owner you must set the example for your employees.

No one can do this for you. You can't pay an outside consultant to smile for you. If you aren't sure where to start, then pick up a copy of "How to Win Friends and Influence People" by Dale Carnegie.

2. Existing customers. Another neglected area in most businesses is the act of communicating with existing customers. I can't remember the last time a business I frequented sent me a coupon or note or anything for that matter.

Keeping in contact with customers does not have to be an extensive and time-consuming endeavor. A monthly newsletter, a quarterly coupon mailing or a special occasion or holiday is sufficient. The idea here is not to sell them something but to simply remind them that you exist and value their business.

3. Referrals. If you are not offering an incentive to your existing customers to refer new customers to you, you are missing out on a huge profit center.

Referral coupons are one way of enticing customers to refer. If a coupon makes it back to you with a new customer, then the referring customer gets a "spiff". A "spiff" can be a discount coupon, movie tickets, or a free item, anything that shows value.

It is important, however, for the "spiff" to be something of perceived value to the referrer. Cheesy doesn't work. The referrer needs to be excited or grateful for the "spiff".

4. Thank you. Simply but overlooked. The act of thanking people for their business. Sending thank you notes to customers who refer is an important practice.

Most importantly, however is the practice of saying "thank you" when customer leaves even if he doesn't purchase. How you say "thank you" is also important.

Many times I say something to the effect of "thank you for using our services we really appreciate your business". This says so much more than a simple "thank you" does.

Thank customers for information they provide to you, thank them for referrals, thank them for keeping you in business, whatever it is just remember to say "thanks".

5. Testimonials. Overlooked but critical to building credibility with potential customers.

If you are a brick-and-mortar business you should have customer testimonials posted where new customers can easily see them.

If you are an online business they need to be front and center on your web page. Do not hide them behind links, put them right on the home page.

Testimonials will do more for you than any other type of advertising. Sprinkle them throughout your mailers, on postcard mailings, in your office or store, on your web page, in your emails. Everywhere, you can't wear them out.

6. Rewards. Rewarding customers for their loyalty is a great way to drive repeat business and boost your bottom line.

I recently sent out a letter thanking customers for their loyalty, telling them that they had been added to my VIP customer list, and presented them with a thank you coupon.

In the letter I also covered new services and products. I had a 90% response rate. Some customers called just to say "thank you" and chat.

This form of relationship building is a critical success factor.

The reward program can be points like airlines currently use, a cash back program, tiered discounts, anything that motivates the customer to buy more to gain the incentive.

These six strategies are mandatory to building a customer retention program and for motivating new customers to buy.

Implement one a month for the next 6 months and watch your sales go up.

Customers need and want to be appreciated and respected; this should be standard operating procedure for every business owner.

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