There is more money in your customer files than in any single place. Here’s how to take serious advantage of it.

Contractors pour most of their marketing money in search of an elusive goal: more customers. This is, after all, marketing’s job right? Well, yes and no.

The truth is that marketing’s job is to attract, acquire, and retain paying customers. It’s that last part that contractors overwhelmingly underestimate. In fact, you spend $275-$325 just to get a customer. I’ve read almost every study related to this issue and that is the consistent range in every one of them. If you only service them once, there’s an excellent chance you lost money on them. Yet the real shocker is that the average contractor spends less than $40 in three years to keep them!

This is why I scream — I mean strongly suggest — to my clients to establish new standards in customer retention.

  • Set Customer Standards. Put figures on your customer service just like your other business systems. How long to handle a $100 complaint? A $1000 complaint? Who handles each? Do you have customer priority levels? Who gets a "Happy Call," a gift certificate, and a newsletter? Have a system of service that won’t fail you.
  • Satisfaction comparison. Shop your competition! Face it, other companies may handle an issue better than you do and customers may love it! You'll never know unless you find out. Have an employee's spouse stay home one day and take estimates.
  • Regular contact. This is essential. Sending only sales messages makes your relationship a shallow obligation. Staying in touch assures a higher "top of mind" rating with customers. Regular newsletters (2-4 times a year) are best.
  • Customer Commitment. This includes satisfaction training, better guarantees, and a written statement of what customer satisfaction means that is at least distributed to your employees and at most published on all your customer correspondence.
  • Customer satisfaction measurement. Either as a random call, or a "bounce back" card on your satisfaction survey. Simply ask: How did we rate in these areas? How can we improve? What other services could we offer? Were we clean, neat, orderly, polite, etc?

Adams Hudson is president of Hudson, Ink, a marketing firm for contractors. Readers can get a free marketing newsletter by faxing their letterhead with the request to 334/262-1115. You can also call Hudson, Ink at 800/489-9099 for help or visit www.hudsonink.com for many free marketing articles and reports.