Are You Mining Fool's Gold?

In the 19th century, many seeking to get rich quick spent countless hours mining in the gold fields and ended up only with Fool's Gold. Looked like gold, felt like gold, but lacked the value of real gold. Is today's business world any different?

New customers to satisfied clients may be the Fool's gold of the 20th century. W. Edward Deming, an individual ahead of his times, recognized the value of loyal clients when he said:

Profit in business comes from repeat customers, customers that boast about your project or service and that brings friends with them.

So many businesses are mining for new buyers while ignoring their existing clientele. These business owners are possibly embracing the 20th century strategy of consumer satisfaction forgetting that they are now in the 21st century. Here the marketplace has changed because of the Internet. Now with just a click of a mouse, your satisfied customer can as easily become your competitor's satisfied patron.

The difference between Fool's Gold and real Gold is a matter of value. A new shopper costs 5 to 6 times more to acquire than an existing one. Increasing your client retention just by 5% will increase profits by 25-100%.

Spend 5 to 6 times more mining Fool's Gold seeking new or just satisfied patrons or increase profits by 25-100% by mining and then turning existing client into loyal buyers. What choice would a reasonable, intelligent, business owner make?

Additional customer loyalty research data suggests that your loyal shoppers tell a lot more people about your products or services (boast about you - Word of Mouth advertising, WOM) send far more referrals (bring friends) your way and are a little more understanding when a mistake is made.

Of course you need a map or a customer loyalty plan to mine your existing clientele For some may only buy from you monthly, while others buy from you quarterly. You need to assess your consumers' buying cycles and determine how you can ensure current purchase levels and start to increase those levels if possible. If you cannot increase current revenues for a specific patron, then see if you can gain more referrals from them.

Regardless of what actions you take, you need to stop mining for Fool's Gold and mine for the Real Gold - loyal customers.

Tired of mining for Fool's Gold? Improve your customer loyalty.

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