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Should Businesses always be honest with customers?

October 04, 2019


Introduction

Customer is a life blood of any business. To create the loyal customer we must be honest to them. It takes years to build trusted relationship with customer, with honesty only we can do this. We are in business not to exploit our customers. We do have our social responsibility to a community. Businesses are operating to be profitable for a long term so we have to be always be honest with customers. The business can be benefited in a several ways by having a loyal customers.

    The benefits of retaining top customers

The top 10% of your customer base is spending three times more than your average customer, so the first major benefit is revenue. Also, it’s less expensive to keep customers than to acquire new ones, so an effective customer retention program can save you money. Finally, repeat customers are more likely to recommend you to others, making your brand visible and desirable in the long run. These top customer can be retain in the business with honesty. No matter you are startup or mature organization, customer retention should be your highest priority. This can be achieved only when a business focuses on building customer loyalty.





Cross and Up Selling Opportunities:


‘The probability of selling something to a prospect is only about 5-20%, while the probability of selling something to an existing customer is 60-70%.’ Marketing Metrics.

The every business existing customer was a most important customer as they purchase 60% to 70% of their products. It’s more easy to do cross selling and up selling. The existing customer do repeat business as they have more trust on business. The trust may be broken if we are not honesty to customer so it’s very important to be always honest with the customer.

Minimize Service Cost

Loyal customers are most cost effective to serve.They are already familiar with a company’s products and services. This help reduce the company cost on marketing advertisement. Loyal customers can help to solve other customers’ problems as well.First, Build a community where your customers can share their experiences, issues, solutions. And then engage your customers more and more in that community. Even you can give some incentives or loyalty points to those customers who solve others issues successfully. Customer loyalty can be gained by serving the trusted and honest services continuously.

Importance of customer loyalty to a business:

  1. Customer Acquisition And Retention
  2. Repeat Business
  3. Cross/Up Selling Opportunities
  4. Reduce Marketing Cost
  5. Minimize Service Cost
  6. Forecast Accuracy
  7. Improve Brand Image
  8. Honest And Quality Feedback


Conclusion

The business always want to have good relationship with their customer. The long lasting relationship can be build with trust and honesty. Being dishonest to customer some time business may have to face legal action as there are different laws and regulations to protect customers and our environment. As business want to be profitable for long term they must create loyal business customer. The loyal business customers will help generate more revenue to the business. The loyalty can be maintained being honest to customer. Being always honest to customer is vital for business development.






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