The customer database is an essential tool for implementing highly effective marketing programs and schemes. Knowing your market is the first step towards building a good client base. In addition, customer retention is easier to achieve if a company has well-kept tabs on its client list. The customer database reduces marketing cost, ensures repeat business, segments your markets, increases customer loyalty and identifies a business’ most valuable clients.
What should be included in the customer database? Aside from customer name and info, all transactions that can be measured should be recorded. Your customer database should include fields for the following: date of last transactions; complete transaction history; total amount spent; type of industry; and type of customer. Ideally, a well-maintained customer database will allow you to derive your customer retention ratings, and alert you when a customer has possibly defected to another establishment.
It is a good practice to distinguish between the four customer types: suspects, prospects, first-time buyers and repeat customers. Suspects are people whom you think may be interested in your products and services, but have not yet initiated any contact with your company. Suspect lists may be obtained from associations, business groups, list rentals and other sources. Once they have initiated contact such as asking for estimates, quotations or free samples they are to be considered as prospects. Prospects are people that have shown interest, initiated contact with the company, but have yet to make a purchase. Among all the four consumer types, prospects are the likeliest to be engaged by introductory offers and trial period agreements.
First-time buyers are those who have made a monetary purchase of your products or have paid to avail of services. First-time buyers should be valued because they have already demonstrated confidence in your company. With the right handling, these first-time buyers will develop brand loyalty and turn into repeat buyers, the main lifeblood of business success.
Among all consumer types, repeat buyers are the most valuable. They possess loyalty to your product or services and provide a steady client base. The more repeat buyers you have, the more stability your company gains. Customer retention should be a top marketing priority. Remember that for every repeat customer that you lose, you will have to gain at least eight new customers to make up the difference.
This article was contributed by Joana Chrystal Ventura-Moises. Ms. Ventura-Moises is our resident expert on home plumbing and apron sinks.