How to systematically win customers back

If you’re a franchisee, then you have one of the toughest jobs there is.

You’re not only a business owner who’s financially and personally invested in the business. But you’re the CEO of your business. The buck stops with you.

Whether you were ready or not; whether you had any formal training in business management, human management, financial management, operational management, marketing management or leadership management. Suddenly, you are required to have all of this.

You want lots of customers coming to your store. Your dream is that every new customer becomes a regular customer. You’re right. The benefits of a regular customer is enormous:

• Reduced Costs to Serve. Regular customers know what they want, know how you work & won’t ask a million questions

• Savings on Acquisition Costs. It costs five times more to get a new customer than to keep an existing one

• Increased Margins. Regular customers are more likely to accept price increase

• Increased Revenue from Cross-Selling. Regular customers are more likely to buy other products/ services from you like catering

• Increased Revenue from Up-Selling. Regular customers are more likely to take-up special offers from you. Their average transaction is more likely to be higher than new customers

• Increased Revenue from Frequency. Regular customers visits your store more than a brand new one

• Increased Revenue from Referrals. Regular customers are more likely to refer others to you

So the thought of losing these regular customers should bring a tear to your eye. It sure will burn a hole in your wallet over time! It is inevitable to lose some customers. That’s just reality. But as the CEO of your business, do you know how many customers you are losing in any given month?

Track your customers
Just like Sales numbers, you need to track Customer numbers. It’s the only way you will know how many customers you’re losing. The definition is arbitrary. You define it. For a food retail business it would be something like this:

• New Customer – First 3 transactions

• Customer – Transacted more than 4 times but less than an average 2+ times a month

• Regular Customer – Transacted on average more than 2 times a month

• Lost Customer – Have not transacted more than 2 months

Capture Customer Data
You need to capture individual customer transaction history through all the different ways a customer can buy from you. Integrate all sources of customer data to a central customer database. This includes in-store orders (POS data), online/ mobile orders (ecommerce), online bookings data, loyalty membership, complaints registry data & catering orders.

You must have a mechanism to identify the individual customer to attach them to that piece of data. For example, when a customer places an order online, their email address or their mobile phone can act as the identifier.

In-store is trickier. You must do this but without friction, without disrupting speed of service. The best way to do this is via an app where the customer can be identified with a press of a button or scan.

Setup Reports
Set up a Monthly Customer Reports from the central customer database that will tell you: New Customer numbers, Customer numbers, Regular Customer numbers & Lost Customer numbers.

Don't wait too long
Your food might be A-mazing with a capital ‘A’. But customers are not sitting idle doing nothing & waiting for you to charm them back. You, my friend, have become irrelevant to them & you’ve slipped way down on their mental priority ladder.

The likelihood of wooing them back depends on how fast you’ve noticed that they’ve been missing.

Imagine if you’ve suddenly realised that your girlfriend of two years has not been returning your calls. Did you notice this within a day? A week? A month? The chances of wooing her back after a month of doing nothing are zero. You’d have a better chance getting the love of your life back if you noticed within a day or so. You’ll have a chance to understand the issues to resolve.
It is the same with customers.

Give great reasons to return
Okay, you’ve noticed that they’re gone. What is your plan to win them back?

“Hi Liz, you’re a valued customer and that’s why we want to give you a free coffee with every purchase for a month”.

That is like saying to the love of your life:

“Hi Liz, I love you and that’s why from now on I will hold your hands in public whenever you pay for dinner”.

You must move mountains with no conditions attached. If the first mountain didn’t work, move the next bigger one & so on. Not only provide promises of redemption but also be authentic & genuine about it.

“Hi Liz, we’ve noticed that you haven’t been back for while. We don’t know what we did wrong but if you let us know, we promise to try hard not disappoint you again. Please come back. We have a free meal with your name on it”.

Systematise and automate
A good customer database will have a communications automation function. This is where you can setup emails & SMS’s that will only be sent out once a customer meets the data condition according to the data in the database.

Once you have the tools in place, you can develop the Win Back emails. The content & offer is critical to enticing them back. Remember, promises of redemption & shower gifts.

Set the first email to be sent out at two months after no transaction. Set the second email to be sent out two weeks later if the offer in the first email was not redeemed. Remember, move mountains.

Why stop there? While you’re at it, setup automated communications for: Milestones (eg birthdays), Top customers of the month, Bottom customers of the month, Reward points & Signups (eg. Loyalty program).

What you’re actually doing through these automated communications is acknowledging individual customers for their interaction with you. Showing your appreciating by rewarding & gifting individual customers for their support. Being consistent on how you show ‘care’.

The beautiful effect of all this, is baseline customer retention.