|
Want
to Keep Your Customers? Sign Them Up!
Service
Contracts Offer Low Cost Method to Retain Clients
With
loyalty programs and other customer retention
initiatives popping up everywhere these days, many small
business owners ask themselves the question “What
should I be doing to retain my clients?” Since you
don’t have the resources to launch a brand new loyalty
program for your business, you may not be able to
compete toe-to-toe with the expensive loyalty programs
offered by large companies to draw customers in and keep
them, such as “AirMiles” programs.
However, there is one thing you can do…sign
your customers up for life today using Service
Contracts.
Service
contracts are essentially an agreement between your
business and your client that outlines the services you
will provide to them in exchange for a stated
“membership” or “service” fee. You can see this
theory in practice at some local warehouse clubs, where
a yearly membership fee entitles you to buy items at
wholesale prices.
Service Contracts at Work
Here’s
an example of how a service contract can benefit a small
business. A friend of mine runs a small plumbing
business, competing against a national plumbing chain.
Every time he visits a customer, he brings a contract
with him. For a small fee, the customer can sign up for
a list of annual maintenance services offered at no
additional charge. In other words the client pays once
and then receives yearly plumbing maintenance. Many
customers sign up for the deal because my friend offers
them a discount on their existing repair job on the spot
to sign up. Often the discount is equal to the cost of
the membership, hence the services in the contract are
essentially free.
Getting
“The Call”
Where’s
the business benefit? Simple…”the call”.
Whenever someone has a plumbing problem, where is the
first place they go? It’s usually the Yellow Pages, to
look up a plumber who can come out to fix the problem.
With my friend’s service contract in place, who do
think “the call” goes to now? I’ll give you a
hint…it’s not the major plumbing chain with the big
Yellow Pages ad. By having such a contract in place, you
become the “first call” for a client, a critical
piece in the client retention puzzle.
The
annual services are not a burden for the business. The
routine maintenance takes very little time and is well
received by customers. Often, a problem may be located
during an annual inspection that requires repair, hence
my friend generates business by locating the problem and
bringing it to the homeowners attention. Whether it’s
legal services, computer repair, web hosting, or web
design or any other type of small business, you could
come up with some kind of annual service to offer your
clients as part of a service contract.
Think
about the applications for your business. Imagine if you
could make yourself the first call a potential customer
makes then they require a service or product like yours.
Imagine if you got the call, and not your competitors.
Small businesses spend so much time and money on
advertising and other promotional efforts to just to be
that company that a client calls first. Using a service
contract, you might be able to get that call free.
The next time you are frustrated by a loyalty program
that you think you can’t match, look to yearly service
contracts to provide a weapon against your larger
competitors.
Article
contents © 2007 by marketingyoursmallbusiness.com
Will
Dylan is the Author of “Small Business Big
Marketing” a powerful e-book for small businesses
available through his website www.marketingyoursmallbusiness.com
. You can contact Will at askwill@marketingyoursmallbusiness.com
|
