The pandemic has fundamentally changed customer behavior forever. The shockwaves of COVID-19 are still felt across the world, keeping countries and businesses in a state of change. The businesses that are agile and adaptive, ready to tackle oncoming challenges and capitalize on emerging opportunities, are putting themselves in the best position to thrive. Yet, what small business leaders also need now more than ever is to have compassion.
It’s crucial to recognize the customers that stuck with you during the hard times. The customers that waited through delays when the supply chain was rocked by disruption, and those that loyally followed their favorite businesses as they rapidly shifted to online.
Recognizing and rewarding these customers, showing them patience and understanding will help to forge lifelong customer relationships bound by trust.
Keep customers close
Compassion and flexibility are crucial traits in any successful relationship. Many customers will experience financial instability as we embark on year two of the pandemic. Late payments and short-term difficulties are likely, but that shouldn’t stop them from doing business. It pays to show flexibility, as the probability of selling to an existing customer is 60-70%, compared to 5-20% for a new one.
According to a recent survey of 1,000 small to midsize U.S. business leaders, during the first year of COVID, almost half of respondents offered customers either flexible payment options (43%), reduced prices (42%) or net new incentives or reward for purchases (42%).
Businesses should not shy away from continuing these flexible payment plans if it’s likely to salvage an existing customer relationship. Going the extra mile to help a customer when times are lean ensures they remain engaged and loyal when they’ve rebounded into a stronger position. A lost customer simply goes to your competition, a loyal one will pay you back many times over.
Making this possible requires a business to make sure they have factored in these measures to avoid cashflow issues of their own in the short term. The use of cloud-based accounting tools can give them a detailed, real-time overview of cashflows, helping them to plan around immediate shortfalls should they arise.
Trying something new
Today, in the depth of disruption, businesses are transforming. Many companies shifted to a digital-first model to remain relevant, and more changes are certain going forward. Making changes alone, without customer insights, is like navigating in the dark without a light.
The demand for solutions that were front of mind for customers prior to the pandemic might not be important now, and new challenges have likely taken their place. As customer priorities continue to evolve, businesses that are always listening will be more successful than those who don’t. The most valuable action a business can take is pivoting with changing customer needs—developing new solutions or features that address current challenges. That’s why it’s important to understand your audience and use their insights to drive business decisions and strategy.
Customers can be a great, and often free, source of innovation. Now is the time to re-engage with them, ask about their pain points and get their thoughts on new products or services. Customers are the ideal business partner because they are honest with their feedback, which makes them the perfect sounding board for new ideas. What’s more, customers always appreciate businesses that engage with them and action their feedback.
Businesses can take their customer relationships to the next level by understanding them on a data-level. Many businesses will have more customer data than they think – not only contact information, but the data that customers entrust with the business, such as financial and transactional information. This insight is more telling than a conversation or survey, and it allows businesses to be more proactive and personalized in how they engage.
A new paradigm
In a digital-first world where products are highly accessible and pricing is highly competitive, customer relationships are the differentiator. A loyal customer is far more valuable than a potential one. That’s why, regardless of the size or industry, a business must nurture and build strong relationships with its customers, fostering an open dialogue that promotes compassion, transparency and flexibility. Supported by data and insight, these are the key ingredients for creating a truly customer-centric business.
Terence Cummings is the Vice President of Business Operations at Sage, the market leader for integrated accounting, payroll, and payment systems, supporting the ambition of the world’s entrepreneurs.