A recent study by the Tempkin Group found that it takes an average of five clients giving positive referrals for your business in order to get one new client. Yet it takes only two disgruntled customers speaking negatively about your business for you to lose one customer.

You do the math...that means it’s twice as important to ensure that you don’t have unhappy customers than it is to maintain good relations with your happy customers. This doesn’t mean you shouldn’t focus on the latter—of course you should. But it also means that if you don’t have a system that empowers or motivates your employees to solve customer problems, you may be feeling the negative impact on your business.

Most people don’t set out to dislike or become a detractor for a business. The reason this happens is when a satisfied or neutral customer encounters a problem or an issue that isn’t resolved. At that point there is an immediate decline in loyalty. However, if the problem is handled well, the customer’s loyalty increases above his or her original loyalty level.

The biggest determining factor as to whether a customer becomes or remains loyal after a problem is whether that problem has been resolved. Unfortunately, many times employees believe that they are resolving a problem, when in fact they aren’t.

This happens more often than you might think. Employees jump to a solution for the customer; quote company policy back to the customer; or go for the easiest solution, which is often a discount. The end result is an unsolved problem and a frustrated customer.

To ensure that your customers feel like their problems are resolved in a satisfactory manner, be sure that every employee follows an established process for customer complaint resolution. These steps should include acknowledging the problem, taking down facts, taking ownership of the problem, ensuring the customer receives a resolution to the problem and following up to make sure they are happy with the resolution. If one or more employees don’t follow this process, make sure there are consequences so that next time they will be motivated to follow the process.

It only takes two detractors to undo all the hard work and effort you put into building a positive image that results in one new business referral. You may want to consider spending as much time training employees in customer complaint resolution as you do in coaching them how to get referrals.

A recent study by the Tempkin Group found that it takes an average of five clients giving positive referrals for your business in order to get one new client. Yet it takes only two disgruntled customers speaking negatively about your business for you to lose one customer.

You do the math...that means it’s twice as important to ensure that you don’t have unhappy customers than it is to maintain good relations with your happy customers. This doesn’t mean you shouldn’t focus on the latter—of course you should. But it also means that if you don’t have a system that empowers or motivates your employees to solve customer problems, you may be feeling the negative impact on your business.

Most people don’t set out to dislike or become a detractor for a business. The reason this happens is when a satisfied or neutral customer encounters a problem or an issue that isn’t resolved. At that point there is an immediate decline in loyalty. However, if the problem is handled well, the customer’s loyalty increases above his or her original loyalty level.

The biggest determining factor as to whether a customer becomes or remains loyal after a problem is whether that problem has been resolved. Unfortunately, many times employees believe that they are resolving a problem, when in fact they aren’t.

This happens more often than you might think. Employees jump to a solution for the customer; quote company policy back to the customer; or go for the easiest solution, which is often a discount. The end result is an unsolved problem and a frustrated customer.

To ensure that your customers feel like their problems are resolved in a satisfactory manner, be sure that every employee follows an established process for customer complaint resolution. These steps should include acknowledging the problem, taking down facts, taking ownership of the problem, ensuring the customer receives a resolution to the problem and following up to make sure they are happy with the resolution. If one or more employees don’t follow this process, make sure there are consequences so that next time they will be motivated to follow the process.

It only takes two detractors to undo all the hard work and effort you put into building a positive image that results in one new business referral. You may want to consider spending as much time training employees in customer complaint resolution as you do in coaching them how to get referrals.

You know who they are: your VIP customers. The ones who have purchased more than one vehicle from you and the ones who frequent your service department for their repair needs. What are you doing to show your appreciation for them this holiday season?

Call it a trend or a growing awareness that you can’t take loyal customers for granted, but more and more small businesses are showing their appreciation in the form of a party or other event that offers both fun and rewards to their most valued customers. Would this work for your dealership? Try it and see!

Here are a few tips and ideas:

1. If you’re thinking about a party, don’t schedule one for a Saturday night. You don’t want to compete with other holiday parties. Instead, host an afternoon party when customers might normally be out shopping.
2. If you want to throw a party, make sure there’s a draw worth seeing such as a special guest; i.e. musician, local sports hero, entertainer, author or expert related to your business. One idea might be to contact your local school and invite their chorus to sing holiday songs at your dealership. Kids are cute, the entertainment’s free and they’ll bring their parents.
3. Offer a gift giveaway to “the first 100 people who walk through the door.”
4. Offer a “no pressure” event that will answer any questions consumers may have about your 2013 product line.
5. Do you have any synergistic or marketing partnerships with other local businesses? Consider inviting them to co-host an event with you. The more, the merrier.
6. Tie your customer appreciation event into a charitable or fundraising effort for the holidays. People feel good about giving and are more likely to do so if you make it easy for them.
7. Create a sense of exclusivity; though you may be tempted to invite all your customers, invite only those who have demonstrated the most loyalty. In your pre-event marketing, convey a sense of excitement about this “exclusive” event and give several compelling reasons why your customers will want to attend.
8. Urge your customers to bring a friend, then reward them with a coupon or small gift if they do bring a friend.
9. Use all marketing channels to promote the event. In addition to email, create an event on Facebook for your fans, tweet, post something on Pinterest, display the event on your website, etc.
10. If this all seems like too much work, at the very least contact your most loyal customers and offer them some small gift for the holidays without requiring purchase. Whether it’s extra points, a stuffed animal, a coupon at a local restaurant—your appreciation for them will be appreciated by them!

Have you ever held a customer appreciation event? How did it turn out for you? Do you have any additional tips or suggestions for a successful customer appreciation event?

You know who they are: your VIP customers. The ones who have purchased more than one vehicle from you and the ones who frequent your service department for their repair needs. What are you doing to show your appreciation for them this holiday season?

Call it a trend or a growing awareness that you can’t take loyal customers for granted, but more and more small businesses are showing their appreciation in the form of a party or other event that offers both fun and rewards to their most valued customers. Would this work for your dealership? Try it and see!

Here are a few tips and ideas:

1. If you’re thinking about a party, don’t schedule one for a Saturday night. You don’t want to compete with other holiday parties. Instead, host an afternoon party when customers might normally be out shopping.
2. If you want to throw a party, make sure there’s a draw worth seeing such as a special guest; i.e. musician, local sports hero, entertainer, author or expert related to your business. One idea might be to contact your local school and invite their chorus to sing holiday songs at your dealership. Kids are cute, the entertainment’s free and they’ll bring their parents.
3. Offer a gift giveaway to “the first 100 people who walk through the door.”
4. Offer a “no pressure” event that will answer any questions consumers may have about your 2013 product line.
5. Do you have any synergistic or marketing partnerships with other local businesses? Consider inviting them to co-host an event with you. The more, the merrier.
6. Tie your customer appreciation event into a charitable or fundraising effort for the holidays. People feel good about giving and are more likely to do so if you make it easy for them.
7. Create a sense of exclusivity; though you may be tempted to invite all your customers, invite only those who have demonstrated the most loyalty. In your pre-event marketing, convey a sense of excitement about this “exclusive” event and give several compelling reasons why your customers will want to attend.
8. Urge your customers to bring a friend, then reward them with a coupon or small gift if they do bring a friend.
9. Use all marketing channels to promote the event. In addition to email, create an event on Facebook for your fans, tweet, post something on Pinterest, display the event on your website, etc.
10. If this all seems like too much work, at the very least contact your most loyal customers and offer them some small gift for the holidays without requiring purchase. Whether it’s extra points, a stuffed animal, a coupon at a local restaurant—your appreciation for them will be appreciated by them!

Have you ever held a customer appreciation event? How did it turn out for you? Do you have any additional tips or suggestions for a successful customer appreciation event?

Whether your dealership has, or is considering a loyalty program, it’s important to make sure your marketing messages align with the overall brand or image of your store. What is your dealership known for? Aggressive, “best” pricing? Friendly, no-pressure salespeople? A multi-generation, family owned pillar of the community?

A brand is your identity’s business, and conjures up powerful images for customers, both consciously and subconsciously.  Whether you realize it or not, your brand creates a visual, emotional and cultural connection between you and your customers. Think about brands you know: Disney has a strong brand as the family entertainment leader. Apple commands higher prices than its competition because it has a loyal following that appreciates its innovative, counter-culture image. The Volvo brand is identified with vehicle safety. When a customer walks into your store, what kind of experience do they expect? Do they get that experience every time? Is that experience remembered when they receive their next communications?

All great brands share one thing in common: all of their marketing communications reflects their brand. This includes loyalty marketing. If your dealership is known for aggressive pricing and blow-out sales, and your latest loyalty program e-mail fails to mention pricing anywhere, or instead displays a cozy image of a family around the dinner table, that message will not resonate with your customers. They may not understand why, but it simply won’t ring true. Or, if your dealership is known for its no-pressure sales process but you are sending out e-mails with aggressive sales messages, chances are you are eroding your customers’ trust.

When customers buy a brand, they buy its values and promises, and feel that their expectations are aligned with the company. The goals of your marketing messages are to meet those expectations and continue to reinforce that alignment with your brand. Loyalty communications provides an opportunity to connect with your customers on a regular basis. Like customer loyalty, building brand awareness is an ongoing process—but an important one to ensure long-term success.

Do your marketing messages reflect your brand? In what way? What are your customers’ expectations when they visit your dealership? Does your marketing attempt to meet those expectations? Has one of your favorite “brands” ever disappointed you and if so, did they ever win your business back? 

Whether your dealership has, or is considering a loyalty program, it’s important to make sure your marketing messages align with the overall brand or image of your store. What is your dealership known for? Aggressive, “best” pricing? Friendly, no-pressure salespeople? A multi-generation, family owned pillar of the community?

A brand is your identity’s business, and conjures up powerful images for customers, both consciously and subconsciously.  Whether you realize it or not, your brand creates a visual, emotional and cultural connection between you and your customers. Think about brands you know: Disney has a strong brand as the family entertainment leader. Apple commands higher prices than its competition because it has a loyal following that appreciates its innovative, counter-culture image. The Volvo brand is identified with vehicle safety. When a customer walks into your store, what kind of experience do they expect? Do they get that experience every time? Is that experience remembered when they receive their next communications?

All great brands share one thing in common: all of their marketing communications reflects their brand. This includes loyalty marketing. If your dealership is known for aggressive pricing and blow-out sales, and your latest loyalty program e-mail fails to mention pricing anywhere, or instead displays a cozy image of a family around the dinner table, that message will not resonate with your customers. They may not understand why, but it simply won’t ring true. Or, if your dealership is known for its no-pressure sales process but you are sending out e-mails with aggressive sales messages, chances are you are eroding your customers’ trust.

When customers buy a brand, they buy its values and promises, and feel that their expectations are aligned with the company. The goals of your marketing messages are to meet those expectations and continue to reinforce that alignment with your brand. Loyalty communications provides an opportunity to connect with your customers on a regular basis. Like customer loyalty, building brand awareness is an ongoing process—but an important one to ensure long-term success.

Do your marketing messages reflect your brand? In what way? What are your customers’ expectations when they visit your dealership? Does your marketing attempt to meet those expectations? Has one of your favorite “brands” ever disappointed you and if so, did they ever win your business back? 

It’s that time of year when giving takes priority over getting. Most dealerships I know are extremely generous when it comes to charitable causes, but there’s no need to be humble about it. The more you engage your customers in your holiday gift drives, the more you will be building loyalty with them.

In this recent survey by the American Red Cross, most consumers say they plan to give to their favorite charities despite the slow economy. 79% of people say that they would rather have a donation in their honor than to get a gift they wouldn’t use; and 70% plan to give as much as they did last year. Enabling customers to give contributions through your store’s program is one way to bring customers in, start conversations and create mutual goodwill that can last well into 2013.

Here are a few ideas to build loyalty and tie-in promotions to your current loyalty program around the holidays:

1. Send an e-mail campaign to your current customer base highlighting which causes you’re involved in and how they can donate. At the same time, promote your loyalty rewards program for 2013 by offering to donate something in their name if they become a member, or giving them “free” points to join.
2. Take advantage of end-of-the-year crowds by ramping up sales efforts for pre-paid maintenance plans. What better gift can a person give than a year’s worth of peace of mind? Again, maybe you can tie an incentive such as a donation to a charity of their choice when they sign up for a pre-paid maintenance program.
3. Create a fun, loyalty-building campaign like this “Christmas Cookie” cookbook that Howdy Honda produced last year. Every person who sent in or posted a Christmas cookie recipe on Howdy Honda’s Facebook page received 10,000 bonus rewards points towards any service of their choice.

The holiday season can add a lot to a dealership’s bottom line; but there’s nothing wrong with leveraging a little goodwill so you can build customer loyalty and set yourself up for a great 2013 as well. 

It’s that time of year when giving takes priority over getting. Most dealerships I know are extremely generous when it comes to charitable causes, but there’s no need to be humble about it. The more you engage your customers in your holiday gift drives, the more you will be building loyalty with them.

In this recent survey by the American Red Cross, most consumers say they plan to give to their favorite charities despite the slow economy. 79% of people say that they would rather have a donation in their honor than to get a gift they wouldn’t use; and 70% plan to give as much as they did last year. Enabling customers to give contributions through your store’s program is one way to bring customers in, start conversations and create mutual goodwill that can last well into 2013.

Here are a few ideas to build loyalty and tie-in promotions to your current loyalty program around the holidays:

1. Send an e-mail campaign to your current customer base highlighting which causes you’re involved in and how they can donate. At the same time, promote your loyalty rewards program for 2013 by offering to donate something in their name if they become a member, or giving them “free” points to join.
2. Take advantage of end-of-the-year crowds by ramping up sales efforts for pre-paid maintenance plans. What better gift can a person give than a year’s worth of peace of mind? Again, maybe you can tie an incentive such as a donation to a charity of their choice when they sign up for a pre-paid maintenance program.
3. Create a fun, loyalty-building campaign like this “Christmas Cookie” cookbook that Howdy Honda produced last year. Every person who sent in or posted a Christmas cookie recipe on Howdy Honda’s Facebook page received 10,000 bonus rewards points towards any service of their choice.

The holiday season can add a lot to a dealership’s bottom line; but there’s nothing wrong with leveraging a little goodwill so you can build customer loyalty and set yourself up for a great 2013 as well. 

How many cards do you have in your wallet? The average U.S. household now belongs to more than 18 loyalty programs, for a total of more than 2 billion memberships. That’s an awful lot of loyal customers, but as it turns out, all these programs and cards are having an unintended effect: customer loyalty fatigue.

According to a recent survey by LoyaltyOne, customers are becoming increasingly “fatigued” by customer loyalty programs. So does that mean you shouldn’t have a loyalty program? On the contrary; despite some of the annoyances, most people still participate in their ‘favorite’ loyalty programs, and for many businesses, it’s a proven marketing tool that adds revenue to the bottom line.

So why are customers being turned off? Some of the most common reasons are “I always forget to to bring my card,” “the coupon I got in the mail has expired,” “restrictions on merchandise,” “not getting good discounts,” etc. For the most part, it seems that customers just aren’t perceiving much value in their customer loyalty programs.

To combat this customer loyalty fatigue, make it a priority to create a loyalty program  that stands out from the rest, and is perceived as valuable by your customers. Here are a few tips on how to accomplish this:

1) Consider a loyalty program where cards aren’t mandatory. All the customer has to do is give his or her name, or phone number, and all the membership information and transactions can be pulled up and done on screen.

2) Give members something fun to work towards. Having a tiered loyalty program allows you to send updates like “only 100 points away from becoming a silver/gold/platinum member!” In general, people like to feel they’ve achieved VIP status or increased recognition. But if you have a tiered program, make sure the customer feels like they’re getting something for achieving the new level! How does gold feel different than silver? If you or your customers can’t explain that, then re-think the tiers. Remember, sometimes you have to give more to get more!

3) Offer choices. One thing that many customers don’t like is being restricted in terms of what they can use their rewards points for. Be sure to keep your plan flexible and place the customer firmly in control of what they can use their points for. Whether it’s towards a new car, a discount on a maintenance service, dinner for two at a good local restaurant, or even cold, hard cash, people define “value” differently and will appreciate different types of rewards.

4. Don’t spam your loyalty program members. These are your best customers who have entrusted you with their e-mail addresses. The last thing you want to do is break that trust by spamming them with e-mails every day, or even every week. Be sure that you are only sending them selective, relevant e-mails. It may take a little more work to divide members into groups with specific preferences, but trust me, it will pay off.

Are your customers suffering from customer loyalty fatigue? Creating a customized, flexible program that offers customers real benefits is the key to ensuring that your program is perceived as valuable.

How many cards do you have in your wallet? The average U.S. household now belongs to more than 18 loyalty programs, for a total of more than 2 billion memberships. That’s an awful lot of loyal customers, but as it turns out, all these programs and cards are having an unintended effect: customer loyalty fatigue.

According to a recent survey by LoyaltyOne, customers are becoming increasingly “fatigued” by customer loyalty programs. So does that mean you shouldn’t have a loyalty program? On the contrary; despite some of the annoyances, most people still participate in their ‘favorite’ loyalty programs, and for many businesses, it’s a proven marketing tool that adds revenue to the bottom line.

So why are customers being turned off? Some of the most common reasons are “I always forget to to bring my card,” “the coupon I got in the mail has expired,” “restrictions on merchandise,” “not getting good discounts,” etc. For the most part, it seems that customers just aren’t perceiving much value in their customer loyalty programs.

To combat this customer loyalty fatigue, make it a priority to create a loyalty program  that stands out from the rest, and is perceived as valuable by your customers. Here are a few tips on how to accomplish this:

1) Consider a loyalty program where cards aren’t mandatory. All the customer has to do is give his or her name, or phone number, and all the membership information and transactions can be pulled up and done on screen.

2) Give members something fun to work towards. Having a tiered loyalty program allows you to send updates like “only 100 points away from becoming a silver/gold/platinum member!” In general, people like to feel they’ve achieved VIP status or increased recognition. But if you have a tiered program, make sure the customer feels like they’re getting something for achieving the new level! How does gold feel different than silver? If you or your customers can’t explain that, then re-think the tiers. Remember, sometimes you have to give more to get more!

3) Offer choices. One thing that many customers don’t like is being restricted in terms of what they can use their rewards points for. Be sure to keep your plan flexible and place the customer firmly in control of what they can use their points for. Whether it’s towards a new car, a discount on a maintenance service, dinner for two at a good local restaurant, or even cold, hard cash, people define “value” differently and will appreciate different types of rewards.

4. Don’t spam your loyalty program members. These are your best customers who have entrusted you with their e-mail addresses. The last thing you want to do is break that trust by spamming them with e-mails every day, or even every week. Be sure that you are only sending them selective, relevant e-mails. It may take a little more work to divide members into groups with specific preferences, but trust me, it will pay off.

Are your customers suffering from customer loyalty fatigue? Creating a customized, flexible program that offers customers real benefits is the key to ensuring that your program is perceived as valuable.