If you haven’t noticed by now, things really stink in the retail world in terms of sales. Reports from major retail sellers were dismal, and at best simply tried to avoid losses as much as possible. Target was down 2% year of year as an example. The major box stores like Costco were up because they are perceived as the rock-bottom places of bargain prices (the only problem is you need a pantry the size of a cow barn to fit everything you buy in bulk there - seriously, what are you going to do with that much toilet paper?!?). Luxury retailers and big items were severely in the pits. Car dealers are actually closing across America in droves, and furniture stores are not that far behind with many of the mom and pops already out of business. So much for the boost of those tax stimulus checks.

And of course, in the midst of this financial chaos one has to wonder how to get customers to come back in the door. The obvious path most retail runs to of course is price-cutting. And that puts the luxury and players trying to stand out at a disadvantage. For example, while Target has placed itself as a better quality brand, cost-conscious customers will defect and go elsewhere to Walmart where they feel the relatively same item can be bought for cheaper. The recession seas are brutally eroding customer retention with each month.

A response of price-cutting to price-cutting doesn’t work either. I’ve walked through Cost Plus World Market, Target, Macy’s, JC Penney’s etc. all week, with each store trying to throw it’s merchandise on the auction block red-tagged and all, but to no avail. The sales numbers just keep slipping. And worsse, the stores are empty. No one is motivated to buy anything.

And the reason being for this loss of revenue is that that conventional customer retention tactics don’t work in a recession. Most folks react to a recession in fear, and immediately clamp down on spending. They think of food and shelter first. They cover the basics, make sure I can pay the bills, and develop a ”can I get through the winter and the year until things pick up again” attitude. However, there are some who very willing to spend for the right opportunity.

Your targeted customer retention becomes critical at this time. First, you need to evoke loyalty, but not the loyalty to you as the business. Instead, it’s your loyalty to your customer. An example would be, to let specific targeted customers know they are part of an inner club that will be eligible for benefits the masses don’t get. The fact that you send to more than one doesn’t need to be broadcasted. The point is to build a sense of special, unique treatment for a customer that spends on your business. Then you roll out the prize. Find your biggest, best items, give them a good discount, service package, bonus items, 2nd sale item option, you name it. You want this to be an ultra-good opportunity for the select buyer. And those with cash in hand will come out to snap up these seemingly “once-in-a-lifetime” opportunities. Buyers with cash are savvy, but they wait for the best time to strike. Why do you think Warren Buffet is so rich?

Additionally, you need to followup with all your customers during an economic recession. Remind them you exist, remind them you appreciate their business, remind them you wouldn’t be there without them. People want to be appreciated, and they reciprocate. For many items and services people can go anywhere, but customers return to those businesses they value because they feel a sense of community, i.e. support those who help you when times are rough. This is the “stick together” theory. If you help your customers, they help you, and you both get through the recession together.

Finally, your activities need to be planned out. You can’t survive a recession just throwing money at any old customer retention tactic. We cover the details of this in a separate post this week reviewing Jim Novo’s Productivity Blog. Read on! 

It’s pretty common knowledge and accepted business lore that customer retention gives you more bang for your buck in terms of return sales. Just reconnecting or helping for a few minutes can be done at little or no cost and usually results in a new sale from an old account. However, customer retention still costs money to perform. So that naturally raises the question, how best to spend your resources on it. For the finance folks among us, this is a no-brainer question. Put your money on the ones that show a return on the bottom line. Ok, but how do you identify those?

Jim Novo tackled that question and some related other ones in a recent post on his blog, The Marketing Productivity Blog.

Jim himself is an interactive customer retention, defection, and loyalty expert with nearly 20 years of experience generating exceptional returns on customer marketing program investments. The average ROI of Jim’s programs now stands at just over 70%, with several reaching ROI of over 400% according to his website. Jim is  also the Co-Chair of the Web Analytics Association’s Education Committee, creating the first college level courses focused on web analytics.

His professional career has been focused on introducing Data-Driven marketing to new industries. In the 1980’s, cable television was the target and his ground-breaking High ROI  customer retention programs were widely adopted throughout the industry. In the 90’s, Jim revolutionized the TV Shopping business by focusing resources on the customer instead of the products.  For the 2000’s, the Internet lies squarely in Jim’s sights. The innovative yet simple customer analysis techniques found in his Drilling Down book put two decades of High ROI Customer Relationship Management experience in the hands of today’s interactive marketers.

From Jim’s perspective, the finance side of customer retention is pretty formulaic. Stuff either works or it doesn’t - did you make money or not? If you have a small number of very high value customers who look to be defecting then a sales call is triggered.  If you have lots of medium to low value customers who look to be defecting, then a direct mail campaign is probably what you need, which is probably marketing.  Match the value of the effort to the value of the customer; this is how you get gigantic return on investment (or for finance types, more accurately something like ROMEs - Return On Marketing Expense).  The scoring approach to customer value is about allocating scarce resources to the highest and best use.

So following this approach one would need to first accurately quantify the worth of each customer currently served or on the books. Second, prioritize them in categories of biggest spenders, okay to moderate spending, and spend very little (yes, this is a bit simplistic but bear with me). Third, determine how much resources will be spent and then put the majority of the funding where it has the highest potential to result in the biggest amount of revenue.

Okay, that sounds simple enough. But what happens when customers change categories and a big player becomes mediocre and a small player does the opposite? Well, obviously your accounts and scoring require ongoing maintenance to watch and see these changes as they have the potential to occur. I don’t believe that Novo is saying only put all your eggs in one basket on the big players and ignore the rest. A lot of companies make this mistake, and forget what got them to where they did was the small players. Instead, the message is making sure your customer retention funding is put into activities and customers that have the highest likelihood to produce revenue.

You can very easily have a customer with big potential, but after all is done, you find you spent almost as much trying to win them over. Where’s the profit? It’s a net wash. Yet, a medium size customer may just need a personal nudge here or there, costing maybe 5% more than minimum outlay, and then your net profit on that account becomes 60% or 70% over total cost. Now that’s profitable customer retention!

Novo really sums up the above issue in two simple, working rules of High ROI Customer Marketing:

1. Don’t spend until you have to
2. When you spend, spend at the point of maximum impact

When you put customer retention in this framework, it all starts to make clear sense and cents!

In Tom Peters’ book, Re-imagine!, Peters refers to Tom Asacker as a “marketing guru.”  More often described as a catalyst and non-conformist and acclaimed for his no-nonsense style, Tom Asacker is the author of A Little Less Conversation and A Clear Eye for Branding, books that redefine business for the new, customer-controlled economy. Tom’s first book, Sandbox Wisdom, uses a heartwarming story about a CEO’s search for meaning and success in the world of business and work and became a business bestseller in the U.S.

As a speaker, Tom has lectured on customer relationships, business, branding, and innovation to corporate, association, and university audiences around the world. He writes regularly for both the national and business press and has provided analysis on television and radio broadcasts. As an independent business consultant, he’s advised start-up ventures and Fortune 100 companies on marketplace trends and brand development.

Asacker is also described as bringing a breadth of marketing, management and operational expertise from prior management posts at General Electric, as well as from his entrepreneurial experience as co-founder and President of a high-tech medical device company. He is a recipient of the George Land Innovator of the Year Award; he holds medical patents and product design awards; and he is recognized by Inc. Magazine, MIT, and the Young Entrepreneurs’ Organization as a past member of their “Birthing of Giants” entrepreneurial executive leadership program.

In part of his regular activities, he also runs his own blog at A Clear Eye, his website for daily musings.

His blog post back in August 2005 should have caught a few eyebrows twitching in the world of customer retention theory. Asacker started off noting that the most metaphors in business refer to customers customers as territory, targets, fish and eyeballs. ”Capturing” marketshare and “retaining” customers is the sales lingo of the day. Instead, Asacker thinks that customer sales and retention should be reoriented around new realities.

Tom wants business to visualize their brand and what consumers expect from it as a magnet. The receiving audience is, of course, iron filings. As a business you could say that you - the magnet - cause the iron filings to move towards you due to your reputation, packaging, advertising, pricing, distribution strength, sales skill, etc.  Or you could say that the iron filings value movement towards you. What’s the difference?

Scientifically, there is no difference. But there is a huge metaphorical difference!

Certainty is implied when you believe that you cause people to move towards you (some could describe it as arrogance, depending how strong it is). Since there’s no obvious reason to change what you’re doing, you pour resources into irrelevant activities and tweak stuff that people may not truly care about.

However, when you believe that people value movement towards you, that signals preference. And as we know, preferences are fluid, always changing in the marketplace.

As a result, Tom believes companies should forget about capturing and retaining customers. Instead, they should get creative about how to continuously attract them and their friends with a compelling and evolving reputation, as well as packaging, advertising, pricing, distribution options, sales skills, etc. The assumption is that if customers area constantly attracted to value, they will always return.

While I appreciate the argument that value will inherently bring customers, it doesn’t happen all the time. The fact that Wal-Mart constantly wins customers has as much to do with the economy as it does with their approach of pricing. You can build the best appliances, but when times are rough (as they are now in our current recession), customers will gravitate to whomever gives them the best price. Sometimes value is not so much quality as it is the best bang for the buck.

So for a business to disregard customer retention, and focus entirely on brand would probably be a mistake. Brand works great for recognition, awareness, placement, and advertisement. Value unfortunately is much more fickle, and changes daily. In that respect Asacker is dead on. As a preference value moves with the moment and can be influenced as such by a business. But customers should not be willingly thrown away for a concept. At the end of the day, it’s people that sell products and services, not concepts.

As an entrepreneur focused on your revenue and increasing sales, you will hear the word ”no” a lot regardless of how thoroughly you stick to the advice in this post. It’s just the nature of the business of selling. And if you haven’t heard some ”no”s by now, you’re not selling hard enough (It’s somewhat similar to a saying in motorcycle racing: if you’re not crashing you’re not riding fast enough.)

However, what can be more shocking is when you get a “no” from one of your existing customers. Many times, businesses have no idea why they just lost an existing customer and, as if they are in a catatonic freeze, they don’t chase after the prospect. But a “no” doesn’t spell the cataclysmic end of your chances to make a deal with a lead or turnover a new project with an old customer. Instead, there are some ways you can keep the conversation going and make those hesitant old customers bring you repeat business after all. 

First, make people laugh. That doesn’t mean get into the stand-up business like Chris Rock. But finding the funny in a situation loosens people up. Try this approach next time: ‘Thanks for telling me “no.” However, I’m in the business of getting at least a handful of “no”s before I get to a ”yes.” You wouldn’t happen to have anyone on your staff who can also say no so I get my quota out of the way, would you?” 

Alternatively you could try: “Is No your final answer?” The worst the prospect can do is basically say “Yes.” And you had no cost or large amount of resource spent to just followup with one more question. Your goal with these types of approaches is not to be smarmy. Instead it’s to get the conversation beyond the tension and uncomfortable stress of a “no” statement and moving on again. Many times a conversation today does become a sale tomorrow. The person may just not be in the right mood today.

Second, ask why you were told “no” at least a few times. Sometimes you have to be persistent but you want to keep asking why until you get to the real reason why the prospect turned you down. For instance, if the customer finally says, they needed the service by next week and you indicated that you couldn’t do it sooner than two weeks but didn’t know they needed the work faster, you could make a second offer and just outsource the grunt work. That allows you a faster turnaround and you just need to polish the final product before it’s delivered on time. But you never would have known that if you hadn’t asked why.

Third, list the things of value you offer customers in addition to what you’re selling. If you don’t have anything to put on the list, you don’t deserve their continued sales. If you’re selling personalized industry analyses to customers, you may want to sweeten the deal with a periodic update for a year so that the product value lasts longer than one report. To make any deal of value you need to offer more than just what you’re selling up front.

Next, tell leaving customers you can’t accept a “no” response until they make two phone calls. Ask them to call two of your other customers who initially said “no” and then decided to purchase from you again. You personally may not win over a deal, but the prospect may listen to your customers who emphasize that you’re still the better deal than anyone else out there.

Finally, find out who your leaving customer is going to buy from for the same product or service, and also try to find out the criteria that won them over. Again, you may have lost the sale immediately in front of you, but finding out the reason why it didn’t work allows you to improve and avoid the same mistakes next time with that customer. 

The word “no” is not a finality in itself with customer retention. It’s simply an obstacle, and it’s your job to find a way around it if you want to stay in the game. So don’t make it harder for yourself than necessary. Use your existing customers to tell you the reasons why they’re saying “no.” Avoid the guessing game and learn better customer retention from your customers.

CustomerThink.com is a global online community of business leaders striving to create profitable customer-centric enterprises. This site serves 300,000 newsletter subscribers and site visitors each month from 200 countries worldwide. Per the authors, CustomerThink is the place to learn about every facet of customer-centric business strategy in articles, blogs and news. Readers can also ask questions and network with other business professionals in the discussion forum.

The website’s mission is to help business leaders develop and implement customer-centric business strategies by publishing high-quality articles, blogs and discussion; conducting research on key issues and trends; and by facilitating interactions with a global panel of experts.

CustomerThink was founded in 2000 (as CRMGuru.com) by Bob Thompson, CEO of CustomerThink Corp. The site was renamed to CustomerThink in April 2007. As editor-in-chief, Thompson is responsible for CustomerThink’s editorial vision and research agenda. Thompson conducts research on leading trends in customer-centric strategy, writes articles and reports, and gives keynotes at conferences worldwide.

CustomerThink’s post on January 23, written by Francis Buttle, seemed to have gone against the traditional customer retention grain and argued that retained customers are not always the best value for the buck. In fact, it surmised that there are two reasons to question financially prioritizing customer retention in the first place:
 
First, summary statistics of success tend to hide how much it costs to get each transaction. Customers vary; some can be very, very difficult to please and others are very, very easy, with a whole myriad of variations in between. Similar to previous posts we’ve noted on this website, CustomerThink argues it’s not uncommon for a few customers to produce a large portion of a business’ sales revenue. This is also known as the Pareto Principle, or the 20/80 Rule. In practice you may lose 10 out of 100 customers, resulting in a 90% retention rate, but if they make up 25% of your revenue it’s really a 75% retention rate. The figure depends on which statistic really matters to your bottom line. It gets more complicated as you throw in additional figures of cost drivers created by specific customers (i.e. travel, shipping, economies of scale, special tooling, special considerations, etc.).

The reverse can happen as well. The same 10 customers lost may be the ones that produce the smallest amount of revenue. In fact, they may be a drag on your business, but you tolerate them because they keep some cash flow going. But if you lose them, instead of a 90% retention rate based on customer, you may see over 100% retention based on sales, since you no longer have the laggards dragging you down with additional costs.

Second, retention depends on how long your customers have been your customers. Newbies tend to come and go. Constant business tends to stick around a lot longer. This bond is strengthened by seller and buyer demonstrated commitment and trust. The longer the relationship, the more drastic the grievance needs to be to break the bond. Just focusing on any old customer retention may blind a business to the customers who are really there in good and bad times.

I think CustomerThink really takes the topic of customer retention to the next level. We’ve talked about how retained customers are important, and how metrics help measurement of performance efforts. But this post really pulls it together with common sense. Use the statistics to tell you what’s happening, but you still need to look at your customers case by case as people to determine who’s really worth focusing on with limited marketing dollars. That’s smart customer retention management. And neither a CRM (customer record management) software system or an Excel spreadsheet is going to tell you this.

For almost 98% of us our work and jobs are our main source of income. A few lucky ones rely on investments, but for the rest the world still revolves around a paycheck. And when that income in threatened whether by layoffs, downsizing, reduction in pay, market/business loss, or disaster then there is a very real chance bankruptcy can be looming around the corner. In many cases, the financial end can come as quickly as one month. So customer retention is critical to make sure the revenue stream flows from month to month with consistency.
 
So what do you do in your business to prevent the cataclysm of a prolonged dry spell or worse complete project and market loss? First off, you prepare while you still have contacts and projects going. There is no off-time. You are constantly on the clock connecting and re-connecting with your customers. The day is long gone when someone could comfortably assume work will just walk through the door like a TV private investigator gumshoe. Companies fold, divisions are cut, directions change, work goes out of country. Today, you’re extremely lucky if your career position lasts more than 5 to 10 years at a stint. And the world of entrepreneur and running your own business is the same.
 
So how to prepare before you have to jump to the next project?
 
Simple. Networking.
 
Yes, credentials, experience and education help. They get you noticed, maybe. But they don’t close the deal. Despite all the new abilities to do a background check and vet a new hire, people and businesses hate taking on an unknown. The risk is just too high. The ability to bring in a “known” candidate is considered a far better pick most of the time. This is were your contacts and customer retention become a key element in protecting your revenue stream.
 
This is where the benefit of networking works its magic. First, you have to assume you are always on the hunt for the next job even among your existing customers. Every person you meet or connect with in your current capacity is a potential hire connection later on. Peers, subordinates, upper-level executive all play critical roles in vouching for you in a number of ways. In fact, playing your network right can get you the next career step long before you see the storm clouds gathering in your current location.
 
So exactly how do you make networking happen? Use meetings, lunches, online social sites (i.e. LinkedIn, Facebook, Myspace, etc.), secondary and tertiary connections, and word of mouth to move and gel with people. Always be willing to meet someone new, even if they’re currently a smaller player than you. Each and every one will become your eyes and ears later when you need them if they feel you are a friend and acquaintance.
 
Now that you have identified the who, work the how. Use your contact software to track your connections. Group them by reason and by level. Many softwares allow you to tag each contact by multiple groups. This gives you quick sorting ability and knowing whom to contact for a particular reason.
 
Then maintain your connections. Do easy favors that don’t cost you much time or energy. Help them do their work. As the movie The Godfather emphasized, it’s a favor the recipient will pay back later. You want those credits built up and varied among many contacts.
 
Finally, when the time comes to utilize your network, you begin to get the notice out that you’re available, free, recruitable. But you don’t ask your contacts if they have a job. Instead, you tell them you are on the market, and if they won’t mind providing a reference. If you’ve been good to them, many of your contacts will be more than happy to give a reference, and will unconsciously or indirectly start looking for you. As their next needs comes up, your name will pop up in their heads first. Next thing you know, your network is working for you and finding you that next project contract or sale.
 
The big bang comes with the reference. Again, companies and people like to hire known commodities. And the best known ones are those candidates vetted by their own people. The trust bond already exists via customer retention/relationship and by connection is extended to you based on their vouching for your ability. Ergo the reference. That’s it in a nutshell.
 
Remember, preparing for the business search doesn’t happen the day you know you need to find a new lead or sale. It happens long before, every time you meet a new face. Work your network, and it will work for you when you need customer retention the most.

Operating internationally out of Delhi, India, WizWriters makes a point to reach a far and wide for business. The company represents a dedicated copywriting service focused on using the right words, a stronger voice, a clear and persuasive tone with high-impact language to improve a customer’s business and presence on the World Wide Web. WizWriters’ approach towards business promotion is considered unique to mark them as distinguished professionals in online copywriting, optimized business writing services & content writing services serving successfully varied business sectors across the global markets.

WizWriters runs the Content Writing Company Weblog, a repository of their company views on effective and optimized content writing for the Internet and e-commerce web ventures. Primarily focused on posts regarding how to improve copywriting (writing for marketing, sales messages and advertisement), the Content Writing Company Weblog touched on the issue of directing customer traffic via selecting web-linking to improve customer retention.

As WizWriters sees it on their June 4, 2008 post, there are thousands of online businesses which are not able to increase their profit levels or boost the rate of customer traffic even after creating a lucrative website. And one of the main causes of this dilemma is the fact that though business websites may be informative and attractive, they don’t do enough to link direct customer traffic to their address.
 
The key is to find and use a popular link. Popular links is far more effective in improving the performance of a business online per WizWriters. Increasing link popularity can be used to increase the ratings of a website tremendously in search engine resulting pages. Popular links also help in boosting up the quantity of customer traffic and retaining them as well. Therefore, link management is yet another aspect which can be used to create useful links for a particular website and maintaining them. WizWriters is quick to warn that the process of link-building can be a slow and gradual process, but it’s a sure shot way to enjoy top page rankings for a long term and bringing the website into the notice of potential and return customers.

The problem with WizWriters’ message and particular post here is that they don’t actually get around to explaining how linking and customer traffic turns into customer retention. Ok, so I got the traffic finally showing up at my web page, how do I keep them there and more importantly how do I get them to buy something? Most businesses understand the concept of an html web link, but they don’t necessarily understand how to leverage that simple coding into a throughput to customer relationships.

Ultimately, regardless of the Internet technology, strategy, and coding involved, sales and customer retention still comes back to building the customer relationship. It’s about giving people something to return for. It’s about creating value that continues to benefit a person again and again. Think about it, why else would you go back to a particular web page or business’ website?

A well-coded Internet website business plan married consistently with a conventional marketing plan is the real way to go for customer retention. Remember: website appearance, coding, Internet traffic counters and search engines are just tools. In and of themselves they don’t produce sales and ongoing, return revenue. Customer relationships and accounts do. Know the difference, and then you can leverage the benefits of Internet capabilities the same way a carpenter leverages the benefits of a nailgun: speed, efficiency, and mass production.

In the world of online auction sales, most eBay sellers couldn’t tell you right off the top of their head how many of their customers are return buyers. And that’s because eBay in itself is not the most conducive platform for customer retention. But there’s a real easy way to figure out if your eBay shop or business even has a chance for return sales. Divide your unique feedback by your total feedback (i.e. your aggregate). The percentage you get is how much are one-time sales versus return customers. Now it’s not an exact science since you’re going to have multiple sales to the same buyer sometimes, but that’s not often. So the result is pretty close to the exact truth. And I’m going to bet that your result is less than 5%.

A 5% rate of customer retention seems low, doesn’t it? Yet the reality is if you have higher than 3 or 4% you’re at the head of the pack when it comes to eBay customer retention. But if you compared that same 5% retention to the regular world, it’s a dismal figure. And that’s because eBay itself doesn’t provide you any assistance. In fact, the auction site is designed to promote one-time sales more than return business. That’s a little silly because eBay’s revenue picture is improved by sellers selling more, not less. But that being said, eBay has done a lot of things that would be considered anti-business which is enough material for another story later.

Back to your own eBay customer retention, having a lot of one-off sales is not going to make you a millionaire anytime soon as an online business, especially if your stock consists of materials that can be used as supplies and repurchased constantly. Onetime sales work fabulously when you have one unique item to sell. For example a gold coin, a rare car part, an out of print book copy - all of these can generate high sales and profitable one-time revenue. But manufactured items, supplies, replacement parts and components need return business to be profitable. So what can you do to boost customer retention on your eBay sales?

First, you need to create a hook that brings people back to you repeatedly. Your product depends on it. This requires you to fully inform your customers about how your products work and can be used. It may be that one of your products works well with another. But if all you do is advertise a basic description and price, the customer may never know the two items work well together. You need to constantly inform your customers of all the possible benefits your products can and repeatedly provide.

Second, you need to make yourself and your store memorable to buyers. eBay’s format is designed to pretty much make one eBay store look like another. This creates even marketplaces so that items don’t have too much variation in price. If the base value goes up or down for an item, then all the stores and sellers get pretty much the same price under market demand. However, if you have a way for people to find you repeatedly, then they won’t be just trolling eBay to find you by accident. They will know exactly where to find their next item. Your eBay ID name is a starting point. Having a memorable name makes finding you easier in eBay search engines which buyers use.

Third, when people buy from you they give you valuable data. That includes their email address, name, phone number and other points of contact, not to mention what they’re interested in. This free material allows you to create powerful email lists with which you can contact these same people later with updates on what you are now selling. You can send out periodic contacts via emails, and if they don’t want any more simply take their name off the list after they respond saying as much. It’s likely by sending an occasional reminder, you can gin up a secondary sell without much effort or cost on your part.

Next, do you remember how sometimes when you bought something there would be an insert? DVDs and music CDs do this all the time. Sometimes it’s a free song, other times it’s a coupon to buy something else. People love to get freebies and they create a great way for you to bring people back. Try a 5 or 10% coupon on their next sale from you. For a small price you just moved more inventory and still made a profit.

Communication is critical to developing the memorable return. Your eBay “About Me” page gives customers valuable info on your business. You can easily create a sense of trust in you as a seller by showing an established business image. And remember, eBay does not have to be the only forum that customers see of your business. You can easily link to your own company website which can advertise even more product and/or services.

Finally, the most important element of customer retention success is the service aspect. eBay is no different than regular business selling. If you provide a legitimate business, accurate listings, efficient shipping, and fast responses to questions, you will see a marked increase in your customers returning for more.

Josh Spaulding created ez-onlinemoney.com a few years back with the intention of trying somehow to leverage revenue from the Internet (although at first he wasn’t quite sure how that was exactly supposed to occur). Ez-onlinemoney eventually started to rank well and his knowledge and online income also increased commensurately. After a while Josh decided or realized he could use his site better as a platform to teach others “the ropes” of Internet marketing as he saw it.

As the main directory is a “static” site, it wasn’t an ideal platform to retain visitors and provide the most value. So Josh instead created his blog as a subdirectory. In doing so, he learned a thing or two about blogging and now regularly delivers daily musings to those who want to work and learn online about marketing.

Josh’s content covers a fairly wide range of topics in the Internet Marketing niche, but his specialties are article marketing, search engine optimization, product creation and general marketing and niche marketing. He’s a strong believer that what goes around comes around. As such, he tries to “practice what he preach” and believes there should be a certain level of ethics with all marketing variations, whether they be online or offline. Ethically, if he were to judge himself, Josh believes he could say his online business consists of 99.1% white-hat, 0% black-hat with 0.9% being in the grey area. Ultimately, Josh tries to be 100% ethical and constantly attempts to persuade others to do the same. He firmly believes the more good you do for the world as a whole, the better quality of life you’ll lead and in the marketing world, the more money you’ll earn.

Along this line of thinking, he produced an article back in March 2008 regarding the Importance of Retaining Visitors. His approach to a successful return customer revenue stream focused on two elements for his online business: building a list and blogging.

The first point is essentially a mailing list. However, Josh believes it can be leveraged to more than just a collection of names and email addresses. Using your particular expertise as a business, that contact data can build two-way bridges and relationships that continue to communicate back and forth, and ultimately brings repeat sales.

The second point, blogging, provides Josh his online communication forum with his customers and other new readers. Again, people love to subscribe to something interesting, but you need to have an expertise in what you’re talking about. If you blog ignorantly, readers will figure it out very quickly and the results will be the reverse of customer retention. It will drive them away from you as a fraud.

The success catalyst according to Josh is then taking the list and the blog and using them together to finalize a synergy of communication with customers and readers. Instead of being a business, you become part of the readers’ community and an integral component to their daily life. And that guarantees repeat sales and revenue streams.

One of the things about running a business is that you learn very quickly how little time you actually have to get things done. And the second thing you learn is how much more work is involved convincing a brand new, cold customer to do business with you than someone you already have a business relationship and past sales experience with. The two issues go hand-in-hand.

Customer retention, even if you’ve done business with someone already doesn’t happen automatically, and as a small business owner much of the operations depend on you. That means amidst all that data, emails, notes, scribbles, invoices, and receipts all over your electronic and paper files is your treasure trove of contacts. However, it takes time and effort to dig them out and put them in a format you can readily use.

At first, starting out, you’re likely going to store everything in manila folders and your Outlook email folders. But none of those contacts are in any form that you can just push a button and tell everyone instantly about your new service idea. That means you first have to get them sorted in some manner that lends itself to an email group. Now while Outlook does provide various folder options for contacts, and allows you to give them various priorities, you still have to manually designate people over to various categories to work with them as groups. Alternatively, there are other software packages out there like ACT or similar that can lend themselves to managing that data and sorting it for you, but it still takes that magic element we’re all short of: TIME.

Guess what, if you’ve gotten to this point and you may be the world’s foremost wizard of Outlook or similar software in sorting your information, but you just don’t have TIME to do it all yourself, it’s time to outsource. Here’s the point: your time needs to be spent on 1) initiating proposals and winning sales, 2) building networks and creating new contacts, 3) maintaining existing contacts, and 4) delivering goods you’ve already committed to working on and will be paid for. That leaves very little energy to be working on mundane data entry.

What you need is to take your notes of why a particular customer is important, their background and all their projects, and their contact info, put it all into a box (real or figuratively) and give it to someone to sort for you in the format you need. And there are plenty of ways to get this done expediently and cheaply. If you have a friend, teen, spouse, or employee, it’s time to delegate and get them involved crunching the boring stuff. However, if you’re truly a solo operation, then you can tap into freelance services to get the work done for you quickly. Elance.com, Guru.com, iFreelance.com, and many other sites offer hundreds of providers who can take your scanned notes, word docs, Outlook files and whatever collection you have and convert them into a manageable format for a price. But there’s a price. You need to do your homework with any provider and make sure they’re up to snuff. This is an arm’s length business environment so it’s caveat emptor, buyer beware. That said, once you have a good provider, you can likely retain them on an ongoing basis to keep updating for files as needed.

Now that you have the information in a manageable format, you can use it as a tool. You can leverage its contact power in the form of newsletters, blogs, white papers, queries, communication bridges, references, and the list goes on. People love to network and connect over the internet, and by giving you their email address in business or contact they are in effect saying “Retain me as a customer! I’m asking you tell me to come back!”

So are you going to? It just takes a little creativity and discipline to have successful customer retention.