How to Improve Customer Retention

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How to Improve Customer Retention

Guest writers Debbie Frakes and Stephen Clegg analyze the key measure of business success in this week’s blog post, “How to Improve Customer Retention.”

Customer retention is crucial for the success of every company. It describes the percentage of customers who purchased within the last 12 months who also purchased within the prior 12 months—13 to 24 months ago. Poor customer retention means that you aren’t keeping customers over the long term and people are not committed to working with you. The result is that you must devote resources continually toward acquiring new customers, taking up valuable time and money. 

Maintaining strong customer retention is important for two primary reasons. The first is that it’s significantly more expensive to sell to a new customer than to an existing one. The second is that the longer a customer works with you, the more they buy from you and the more valuable they become to you. 

The question is, how can you improve your customer retention? 

Understand why customers leave you. 

The primary reasons that customer will leave you are these:

  • You’re mismanaging their expectations and not keeping them informed on the status of their orders. 
  • There is a change in contacts for either the customer or for you. 
  • Your employees aren’t adequately trained or knowledgeable about your products and services or they lack the information system support and tools required to be responsive.

Despite what you may think, price is not at the top of the list when it comes to reasons that customers leave your company to purchase from a competitor. Once you understand why people may stop working with you, you can take steps to prevent them from leaving to buy from competitors. 

How Zintoro helps you retain more customers. 

Zintoro provides the data and insights to recognize at risk customers, while our partner Winsby gives you the tools to significantly improve your customer retention. 

Offer great customer service – In order to deliver top notch customer service, you must understand expectations and be responsive to questions and concerns. Zintoro uses Winsby Inc.’s customer satisfaction and benchmark survey programs to find out what your customers’ expectations are and to determine if there are any issues they are having. Your team can then act on this information and keep at risk customers from leaving you. 

Provide a personalized customer experience – Our AI system tracks each of your customers to identify their next purchase, what industry, and market they are in, and whether they are at risk of being lost. Armed with that information, your sales team can personalize customer interactions and tailor offers and recommendations to meet their specific needs. Our partner Winsby will keep your master lists up to date with the correct contacts, phone numbers, and email addresses. 

Develop strong relationships through consistent communication – Zintoro helps you contact and communicate with customers in several ways. First, you can use purchase history data to identify people who have not purchased in their usual time period, then reach out to ask about their needs. Second, you can distribute highly effective emails through Winsby. Customers who receive Winsby emails typically purchase two to three times more often than those who don’t. Third, Zintoro works with most CRM systems to integrate analytics data with your sales and marketing data, helping streamline customer communication. 

Use customer feedback to take action – Implementing Winsby’s customer satisfaction surveys is a great first step, but you must actually act on the information and feedback you receive. Utilize the insights from the surveys to improve your sales process, products, and other aspects of your business before at-risk customers leave you. 

Recognize the signs of at-risk customers – Zintoro tracks the frequency, consistency, and types of purchases, so you can know who your at-risk customers are. Your sales team can then use that information and reach out to those customers, ask about their needs, and even provide a special offer or other incentive to encourage them to stay with you.

Take steps now to improve your customer retention. 

Increasing your retention rate is an ongoing process that should be started as soon as possible. Building lasting relationships with customers is crucial for the long-term viability of your company because it makes them more valuable to you and it takes fewer resources to sell to them. Zintoro gives you the information and tools required to retain customers and boost your sales. 

Schedule a Zintoro demo to find out how to boost your customer retention, track, and accurately forecast business performance, and to determine the ROI for your marketing and customer satisfaction efforts.

 

Types of Purchases: Understand What Your Customers Are Buying

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Types of Purchases: Understand What Your Customers Are Buying

Guest writers Debbie Frakes and Steve Clegg take a look at customer behavior in this week’s blog post, “Types of Purchases: Understand What Your Customers Are Buying.”

To market your business effectively, it’s important to understand which products and services your customers buy most often and what causes someone to purchase from you. By identifying common buying patterns and the factors that influence purchase decisions, equipment dealers can tailor their strategies to appeal to their target industries and markets. The result is more transactions, improved customer retention, and increased profits.

Why do the types of purchases matter? 

By identifying what triggers a purchase for equipment, rentals, service, or parts, and what is bought most often in each category, you’ll determine what is important to your customer base. Armed with that information, you will know which strategies and messaging for offers, pricing, marketing, and advertising will produce the most significant ROI for your business. Excellent customer service with frequent and consistent customer transactions drive customer retention. Revenue and profits are the result, not the driver.

Understanding what customers purchase most often and why allows you to avoid wasting time and resources featuring products and services with nominal engagement and ROI. 

Capture more sales opportunities. 

The local NAPA, Grainger, and other general supply houses are selling the filters, fluids, and parts to your customers that are required for your equipment. Grainger and Genuine NAPA have an average gross margin above 40%. Most types of equipment require two to six filter changes a year as well as numerous fluid changes. The question is, are you capturing those sales opportunities, or are you allowing someone else to take the order? Recognizing types of purchases will increase transactions, help you engage and retain customers and capitalize on the needs of your customer base. 

Know your trigger products. 

Triggers are items or situations that drive customers to a store or dealer. For example, grocery store trigger products are milk, eggs, and bread, because these items are the reason someone goes to the store in the first place. However, these products represent less than 10% of the dollars spent. They serve to get people in the door, so they can be sold other products sold in the store. 

Examples of equipment dealer triggers for machines, rentals, parts, and service:

  • Emergency machine repairs can trigger equipment purchases when the repair cost doesn’t justify the expense versus renting or replacing the machine.
  • Machine breakdowns or a specific type of project will trigger renting equipment that is not in the customer’s fleet. 
  • Breakdowns or equipment crises will trigger repair or maintenance parts. 
  • Offering a free inspection or a season change can trigger service. 

Crises maintenance represents over 25% of a dealer’s customer interactions for parts, service, and rentals. These transactions require same day or next day service and delivery to meet customer expectations. Equipment represents only 1% to 2% of a dealer’s total transactions, whereas parts and services are 88% and rental is 10%. As a result, your parts and service departments create your customer experience and are ultimately responsible for overall customer satisfaction and retention.

Understanding what purchases bring customers through the door tells you where your main focus should be. 

 Place your resources where they make the most difference. 

Every business only has a limited number of sales, marketing, and financial resources they can utilize at any time. The reason why types of purchases is one of the most critical business metrics is that it will show you which products and services to run promos on, which ones to highlight in your emails and on your website, and what to run paid advertising on. In addition, it will determine pricing offers and your inventory requirements. 

You need to know what people are buying and what triggers those purchases. Businesses should carefully consider their target audience and tailor their marketing strategies to appeal to triggers that resonate with specific types of customers. 

Knowing types of purchases helps you introduce people to additional products. 

Armed with the knowledge of which types of purchases are most common, you can familiarize customers with what you offer. They will come to your website or view your email based on the products they typically buy or because of a specific trigger, but then they’ll see other things that you carry. Use your most popular offerings as a hook to get them in the door, where they can see everything that your dealership provides. 

Zintoro provides equipment dealers and other businesses with monthly business analytics reporting to recognize, measure, and take advantage of key business metrics like purchases, purchase frequency, customer retention, at-risk customers, and more. 

Schedule a Zintoro demo to understand your most common types of purchases and start receiving business analytics reporting today! 

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How To Improve Customer Retention

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How To Improve Customer Retention

This week, guest writers Steve Clegg and Debbie Frakes talk with readers about how to improve customer retention. This is one of the best ways to build successes: keep the customers you already have!

Retention is critical for the long-term success of any business. It’s crucial because it is far less expensive to keep your existing customers than to acquire new ones, and customers will buy more products and purchase more often from you the longer they work with you. Zintoro business analytics will tell you what your overall retention rate is and if you are in danger of losing specific at-risk customers. Armed with that information, you can take the right steps to ensure they keep working with you. 

Why customers leave you. 

Customers will stop working with you for any number of different reasons. But the primary cause is mismanaging their expectations and not keeping them proactively informed of good and bad news. The second most common reason that a customer leaves a business is a change in the employee contact or the customer contact. The third cause is having employees that are not adequately trained or knowledgeable of your products and services. Despite popular belief, price is not typically the thing that drives customers away. In fact, on the list of most common reasons, price is usually fifth or sixth. 

There are several strategies you can implement to retain more customers over the long term. In this article, we’ll look at what they are and how Zintoro helps you put them into practice.

Retain more customers with Zintoro and their partners. 

Offer exceptional customers service. 

The key to providing excellent service is understanding customer expectations and being responsive to their questions and concerns. Your team should be proactive and reach out to customers before they contact you in order to answer the questions you anticipate them asking. 

Zintoro uses Winsby Inc.’s customer satisfaction and benchmark survey programs to determine your customers’ expectations and any issues they are having. Your team can then act on this information. For employee customer service training, Zintoro relies on Ron Slee’s Learning without Scars’ online and in person training programs.

Personalize the customer experience. 

Zintoro AI tracks each customer to determine their next purchase, what industry, and market they are in, and whether they are at risk of being lost. Using that information, your sales team can personalize customer interactions and tailor offers and recommend services to meet their needs, based on their past purchases and preferences. Zintoro also works with Winsby Inc. to keep your master lists up to date with the correct contacts, phone numbers, and email addresses, as well as to segment your lists and tailor messaging to specific groups. 

Build strong relationships with consistent communication. 

Improving customer retention depends on engaging with your customers and supporting them beyond the point of sale. Zintoro can help in several different ways: 

  • Provide the customer purchase data you need to reward long term customers with discounts, exclusive offers, or special access. 
  • Create and distribute high engagement emails, blogs, newsletters, and social media content through our partner, Winsby Inc. 
  • Zintoro works with most CRM systems to integrate analytics data with your sales and marketing messaging. They have found that Constant Contact’s Sharpspring CRM program supported by ClearTail marketing is one of the best because it is easy to use, automates much of the sales and email process, tracks customized information to help the customer experience and sends scored sales leads to your sales team. 

Collect and act on feedback!

The key to understanding your customer expectations and issues is to regularly ask for feedback. Implementing customer satisfaction surveys from our partner, Winsby Inc., provides insights into how customers feel about your company and how well you provide for their needs. You’ll discover issues with your sales process, products, and other aspects of your business before they turn into major problems and customers leave you for the competition. 

Know the signs that a customer may leave. 

Zintoro tracks the products, frequency, and consistency of customer purchases to identify who is at risk. Your sales team can then act on that information and reach out to those customers, ask about their needs, and even provide a special offer or other incentive to encourage them to stay with you. 

Highlight social proof and testimonials. 

Showcasing positive customer experiences in your emails and on your website helps you convert more prospects and keep your existing customers. Zintoro AI tracks the online customer satisfaction scores, and Winsby Inc. posts your verified customer reviews online and on your website.

Zintoro is the key piece of the puzzle for customer retention. 

Increasing retention is an ongoing process. By consistently providing value, personalization, and outstanding service, you can build long lasting relationships with your customers and increase their loyalty to your brand. Zintoro provides the data and information you need to understand your customers, and our partners give you the tools required to retain them and grow your sales. 

Schedule a Zintoro demo to find out how they boost your customer retention, track, and accurately forecast business performance, and determine the ROI for your marketing and customer satisfaction efforts.

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How to Avoid Losing At-Risk Customers

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How to Avoid Losing At-Risk Customers

Guest writer Debbie Frakes returns with practical, step-by-step guidance in “How to Avoid Losing At-Risk Customers.”

How to Avoid Losing at Risk Customers: Recognize the Warning Signs

At-risk customers are the ones that you are in danger of losing to the competition. These are current customers who start purchasing less and less from you and eventually go somewhere else to get what they need. Preventing at-risk customers from leaving you requires two steps: first, you must identify who they are, and second, you must fix whatever is driving them away. In this article, we’ll cover how to do both.

  • Understand the key metrics for your business.

The only way to identify who your at-risk customers are is to look at the key metrics. In particular, you want to look at their purchase frequency. If the interval between purchases is longer than usual for a specific customer, it may indicate that they are beginning to work with a competitor instead of you. 

If you recognize that a customer’s purchase frequency is consistently decreasing, then you want your sales team to contact them. Most people will not tell you if your company is not meeting their needs. They will just leave you after a certain amount of time. Knowing their purchasing behavior will give you important insights into what they are feeling and how things are going. 

Monitoring key metrics like purchase frequency is critical for preventing the loss of customers who are at risk. 

  • Customer satisfaction surveys are critical. 

Once you understand which customers are thinking of leaving, you can take the necessary action to keep them working with your company. The best way to boost customer retention and ensure people stay with you is by conducting customer satisfaction surveys. They help you recognize any issues that people are having with your company before they turn into bigger problems. If you catch the issue early and fix it, then you are showing at risk customers that you care about them, and the odds are that they will stay with you.

Retaining customers is important, because acquiring new ones can cost up to five times more than working with current ones. Immediate profits and long-term growth depend on avoiding the loss of at-risk customers. 

  • Listen to what your customers have to say. 

Once you find out who your at-risk customers are and determine what the issues are that are driving them away, you need to act on that information. When you receive feedback from an unsatisfied customer, you’ll have the chance to contact them and make things right by addressing their concerns. Nothing tells customers you care like giving them your time and attention.

If you actually listen to what your at-risk customers are saying and take the time and effort to fix what they tell you is wrong, then they typically will no longer be at risk. In fact, these formerly at-risk customers tend to become your most loyal and dependable customers going forward. 

If you want to know who your at-risk customers are by reviewing your key metrics, so you can prevent them from leaving, you need to begin conducting customer satisfaction surveys. Contact our partner, Winsby Inc. They will conduct effective surveys on your behalf and arm you with the information you need to retain more customers. 

Contact Winsby Today

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What Purchase Frequency Means for Equipment Dealers

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What Purchase Frequency Means for Equipment Dealers

Guest writer Debbie Frakes writes about metrics today with her blog post, “What Purchase Frequency Means for Equipment Dealers.”

Purchase frequency is a crucial key metric for equipment dealers to consider when evaluating the behavior of their current customers and their marketing efforts. It refers to the number of times a customer buys products or services from a company within a specified time. Analyzing purchase frequency will help you recognize at risk customers, because it tells you when they start going to competitors instead of you. 

 

Know if customers are buying from competitors! 

 

Purchase frequency gives you insight into what your customers are up to. Construction, demolition, utility, and other businesses that use heavy equipment require a consistent supply of parts, service, and machines. That means that if they aren’t buying those things from you, they are going somewhere else. So, if their purchase frequency is decreasing, it could indicate that they are turning to one of your competitors. 

 

Learn your customers’ purchase behavior! 

 

Tracking the purchase frequencies of your customers will give you a baseline for their typical behavior, including when and how much they usually buy. Armed with that information, you can then modify your marketing messaging, timing, channels, and overall efforts to fit your customers’ usual purchasing habits and trends, making it easier for them to buy what they need from you. 

 

Improve specific areas of your business! 

 

As an equipment dealer, you really have multiple different businesses connected and rolled into one. To be successful, each of those different businesses need to be firing on all cylinders and operating at peak performance. If your parts department and equipment rentals are strong, but service purchase frequency is decreasing, then you must take a closer look at that section of the company and implement steps to improve it. 

 

How to increase purchase frequency: Distribute Emails

 

The best way to increase your purchase frequency is through email distribution. When you consistently send out effective messaging, you can double or triple the number of times that your customers buy from you. Email distribution can deliver an incredible return on investment of over 4,000%. 

 

Emails are effective, because they inform people about everything you offer—products, services, parts, rentals, advice you can offer for better equipment performance. They also keep your company top of mind and serve as reminders to purchase again, stock up on parts, or schedule an inspection. 

 

Ensure your emails are effective! 

 

You can only achieve higher purchase frequency if your email distribution is done the right way. Emails must be designed and written professionally, must compel the reader to act, and they require a CTA that links back to your website or landing page. More than anything else, you want to encourage your recipients to buy from you or schedule a demo, and then make it easy for them to actually do it. 

 

Email distribution also allows your salespeople to identify which customers or prospects are engaged by seeing who opens and clicks on the emails. If they follow up with those who are consistently viewing your messages, then they can possibly move them to purchase again. Plus, sending out specific messaging to customers whose purchase frequency is decreasing may just be the push they need to come back to you. 

 

If you want to understand your purchase frequency and increase it through email distribution, then contact Winsby Inc. today. They will help you get started creating and sending effective messaging quickly. 

 

Contact Winsby Today: https://www.winsbyinc.com/contact-us.html

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Upturn or Recession?

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Upturn or Recession?

Guest writers Steve Clegg and Debbie Frakes are writing for us this week about the ways in which our accurate forecasts can help us plan for real growth in “Upturn or Recession?”

The equipment industry is cyclical and seasonal. Many dealerships react to events by looking backward at accounting financial statements, explaining why they are victims of current market conditions. But the most successful dealerships always look forward by forecasting and planning for the future. As a result, they can take advantage of both upturns and downturns.

There are effective Artificial Intelligence (AI) models that can be used to forecast and create a business plan, based on these forecasts. During an upturn, you can expect shortages of parts, equipment, and employees, as we have recently experienced. The best approach to maximizing profits is to focus on the customers and industries with the highest retention rates where the best service can be provided to generate a healthy gross margin and a high return on capital. This process builds cash and liquidity and strengthens the balance sheet in anticipation of opportunities during a downturn.

It is important not to chase the upturn, although OEMs and banks are often eager to encourage that approach to accelerate their own growth. A sustainable growth rate for your own facilities, employees, balance sheet, and customer retention, however, places limits on rapid growth. Most dealers cannot sustain a growth rate in customers and transactions greater than 10% to 15% per year, regardless of the opportunities. The requirements for new customers, employees, systems, facilities, training, and capital are beyond their internal capacity to grow and keep their existing customers happy. Using AI Analytics, you can see forecasts with >95% accuracy for the next 12 months for your business, by branch and department, providing the number of customers, transactions, and revenue that can be expected. With AI forecasts you can anticipate exactly what to expect for your customer retention, customer engagement, and even ROI on your sales and marketing programs. This approach allows better accuracy in planning the future and anticipating the best ways to identify opportunities.

During a downturn, successful dealers forecast, then use their strong balance sheets and cash flow to purchase parts and equipment at steep discounts from their suppliers and competition. They also hire the best employees, pick up additional equipment lines and territories, and acquire assets from competitors that have failed. With this approach they create the foundation for real growth during the next upturn. A 1% improvement in customer retention usually generates a 12% annual transaction growth rate. There is less vulnerability to economic downturns when customer retention is strong. Historically, there is only a 7% to 15% reduction in transactions over a 12-18 month period during a downturn, so the improved retention easily offsets this reduction. 

There are five steps management you can take now to ensure your company can weather any type of economic cycle. 

  • Create a forecast the next 12 months, based on your current performance, and continue to forecast by updating your results with the prior month’s revenue. With this approach your organization will have a clear picture of what will happen for the next 12 months, if you continue to operate as you have been. 

A platform that is easy to use to produce accurate forecasts is Zintoro.com. Its AI Analytics program provides automated forecasts for customers and transactions, including the resulting gross margin and revenue, by company, branch, and department with a >95% confidence level.

  •  Use the 12-month forecast to create a plan that will maximize revenue and profits

Actions for improvements are steps that you plan to begin during the next 12 months to assure you will meet or exceed the forecast, which is your benchmark. 

An action plan for an upturn provides the steps to take to overcome hurdles that are typical during an upturn, such as available working capital, delayed parts and equipment deliveries, dissatisfied customers, increased costs, and accommodating increased order frequency for parts and service with a backup plan to prevent overwhelming your employees and facilities. 

An action plan for a downturn provides the steps necessary to take advantage of the next downturn. 

  • Identify the customers that are not profitable and take steps to reduce interactions with them.
  • Determine opportunities to automate wherever possible, from equipment and customer communications to operating systems. 
  • Build cash and set up processes to generate a high return on capital employed.

A recession presents a set of severe financial hurdles that typically include: reduction in available capital, delayed customer payments, drop in equipment sales, decrease in rental utilization, and reduced frequency for parts and service orders. 

Rank the ways to cut costs, using the improvement of employee support for your customers as the primary driver. This ranking should answer these questions: 

  • What is essential to keep the doors open and assure that stable customers are engaged? 
  • Where to invest to acquire and retain stable customers, by market and industry?
  • Where to invest to hire and retain the best employees?
  • Where to invest in equipment, technology, and facilities at favorable prices?
  • How to keep all other costs as lean as possible? 
  • Where to automate and outsource? 

 Keep shareholders, lenders, suppliers, and employees informed.

Zintoro.com provides reports for actual results and forecasts to manage expectations and keep these groups focused on the key drivers for customer retention, customer engagement, and opportunities for improvement. Revenues and profits result from customer retention and engagement.  

  • Maximize cash and profits.

Implement the following actions quickly to maximize cash on hand and focus on generating additional cash to build and maintain your cash cushion. 

  • Monitor the cash flow weekly with a system to show actual receipts and disbursements tracked at least weekly and continually update the cash forecast for 12 months to anticipates any problem periods.

Obtain debt at favorable fixed rates and establish credit lines to ensure cash availability with reasonable lender covenants. Be aware of their liquidity options. Businesses that line up capital sources before they need funding often receive more favorable terms. Funding sources may include revolving credit lines, owner infusions, alternative financing, and private equity. 

In a downturn, revenue and cash availability always fall faster than expenses. Sources of capital dry up and as inflation accelerates, costs climb faster than you can raise prices, reducing your available cash.   

  • Put together a list of expenses you can reduce to minimize your cash burn rate and identify sources of additional cash and when they may be required. The longest recession in the past fifty years was 18 months; most recessions last less than 12 months. Your goal is to have enough cash, including capital reserves, available to make up the difference between the potential gap in cash flow, so that you can maintain operations for twelve to eighteen months and take advantage of the opportunities that will be presented during such times to build your business. 
  • Manage your supply chain proactively by keeping your suppliers informed with your forecasts and requirements. Anticipate how your customers and suppliers will react when you are projecting your cash requirements. 

In a recession, understanding the financial situation of your customers and suppliers is critical. It’s important to be realistic, not optimistic. Assess customers to identify which ones might slow down their payments or become unable to pay. These customers can double your working capital requirement during a downturn. Meet with your key customers and suppliers to review your forecasts and anticipate their problems by understanding their challenges, too. Negotiate payment plans with suppliers while offering incentives to customers for early payments or bulk orders. 

  1. Evaluate your parts and equipment inventory to reduce capital employed       and increase turns.
  2. Develop a program for recruiting and training employees. Plus, expand ways to retain your employees proactively. 
  3. Track all sales and marketing programs with a return on investment. Cut programs that are not generating a return that you can document.
  4. Forecast and plan, don’t wait and react. Without planning you are put in a position of reacting by quickly cutting spending, firing employees, and putting your equipment inventory and assets out for auction at steep discounts. Reacting rather than plan can destroy your ability to recover during upturn that will follow at some point. 
  5. Track and invest in marketing programs with the highest ROI. Compare spend for customers who were exposed to a marketing activity versus those who were not. For example, if you have an email program in place to alert your customers of specials and services you offer, compare the spend for customers with an email to those who aren’t receiving your emails. Are you calling customers regularly? Compare the spend to those you’re calling to those you haven’t called. What about contacting customer for follow-up surveys? Are the ones you talk to spending more than the ones you haven’t contacted? Below are some comparisons for a dealer over a 12-month period, as an example.

 

Marketing Transactions Revenue Cost ROI times
Program /Customer /Customer /Customer Active Customers
Telephone
    Called         24 $128,440 $28 1231X
    Not called     37 $93,965 $0     – 
Emails
  Emailed               30 $134,270 $35 2378X
  No email                 4 $51,0443 $0     –
Surveys
  Surveyed               16 $82,423 $35 966X
  No survey                 7 $48,616 $0     –

 

Next Steps

Zintoro.com has developed a forecasting program that is updated monthly with your results. Just download the last two years of your invoices, plus invoices from the current year to date, and send them to Zintoro to upload into their password protected portal. They will schedule a call to review where the forecast shows you are headed and what steps you can take to change those numbers. Contact Steve Clegg at csclegg@zintoro.com for additional information.

To get started with marketing programs that you can count on to increase sales and deliver an impressive ROI, contact Debbie Frakes at dfrakes@winsbyinc.com. 

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The Key to Equipment Dealer Marketing: Use the Right Lead Sources

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The Key to Equipment Dealer Marketing: Use the Right Lead Sources

Guest writer Debbie Frakes reviews the importance of generating leads in multiple ways in this week’s blog post, “The Key to Equipment Dealer Marketing: Use the Right Lead Sources.”

The only way for equipment dealers to achieve consistent success is by having a steady stream of new leads coming in through the door. If an equipment dealership doesn’t have that, then your business will slow and eventually cease to be successful. That means you have to find productive, reliable lead sources for your sales reps to focus on. 

The most important lead sources for equipment dealer marketing and sales 

When it comes to determining the best lead sources for your sales reps, the key thing to remember is that it’s not all about new prospects. You also have a wealth of leads for your reps to reach out to from current and past customers. Here are a few of the ones you should focus on to improve your sales and equipment dealer marketing.

Email open reports 

Emails are essential for any marketing strategy, because they remind customers and prospects of all your products and services, and they can encourage them to purchase. When it comes to lead sources, emails are also a very valuable tool. Your sales reps should be reaching out to recipients who have opened and clicked on your emails. They can even tailor their sales message to what the customer or prospect may be interested in, based on which section of the email they clicked.

Last purchase reports 

Last purchase reports are an excellent resource for sales reps to find leads to contact. They should be regularly calling anyone who hasn’t purchased something from you in an average time period for your industry and market. 

Customers from different parts of the dealer business 

Equipment dealers are actually several different businesses rolled up into one. Critical for your success is to link them together and make sure your various departments are sharing leads with one another. For example, if one of your customers comes in for parts, they can become a lead for the service, rental, and equipment sales sides of your operation. Your sales reps should be reaching out and offering to fulfill all of your customers’ needs! 

Your website 

A lead generating website is important for equipment dealer marketing strategy. Your site should make it simple for leads to give you their information, ask you a question, or sign up to receive emails. Once they have the lead’s contact information, a sales rep can then reach out to them, answer any questions they asked, and ask them if all of their equipment needs are currently being fulfilled. 

Lead generation should be a constant activity 

Your business requires new leads, and using the most productive lead sources is the best way to bring them in. At Winsby, we help equipment dealers develop and implement successful lead generation plans using proven strategies. By combining effective emails with professional, easy to use websites, email list verification, calling, and reporting, we can help ensure a steady stream of new business. 

Contact Winsby Today.

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Your Customer Retention Rate Is Your Future Growth

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Your Customer Retention Rate Is Your Future Growth 

Guest writer Debbie Frakes tackles the all-important topic of customer retention in her blog post this week, “Your Customer Retention Rate Is Your Future Growth.” We are often encouraged to attract new customers and can overlook the value of keeping customers for life. At Learning Without Scars, we can’t emphasize this enough. It’s so important to us, we have an entire class on the subject!

Finding new customers is great for business—they help you boost your sales and generate more revenue. However, retaining existing customers is even more important. Machinery dealers know that it is far more expensive to locate new customers than it is to keep the ones they already have. Although we all understand the concept, not all dealers actually use programs designed specifically to keep and develop their customers. 

In this post we’re going to cover the six key retention drivers for growing your business: 

  1. Retain Customers with a Satisfaction Program for continuous improvement 
  2. Customer Internal Referrals more than double transactions each year 
  3. Lead Flow with the right customers in the markets and industries you support 
  4. Convert prospects predictably by selling what they purchase most often and saying “Yes” 
  5. Engage your customers with consistent contact 
  6. Measure and Forecast results

What is a customer retention rate? 

Customer retention refers to the rate at which customers stay with your company for a specific period. The average customer retention of an equipment dealer business is 95.5% per month. Although that may sound very high, what that number actually means is that you are losing 4.5% of your customers each month. Over the entire year, you lose 54% of your customers! 

On average, equipment dealers lose 51% of their customers each year. Only 29% of customers are retained for 3 or more years. Even though it looks like you are retaining most of your customers each month, you’re actually losing more than half of them throughout the entire year. And that pattern just makes business more difficult long term. 

On the other hand, an improvement in your customer retention rate of just 1% each month represents a 12% increase in annual growth. The question is, how can you make that improvement? 

How to boost your customer retention rate: a customer satisfaction survey

One of the best ways to improve your customer retention rate is to conduct customer satisfaction surveys. When they are conducted by a third party, these surveys allow you to learn about your customers and determine any issues before they turn into big problems. It’s important to have them completed by a third party, because customers tend to be more honest about a company if they’re not talking to someone from the company.

A customer satisfaction survey will help you understand your customers’ perspectives, why unhappy ones are unhappy, and how to serve them better. Plus, you’ll impress them by showing how proactive you are. 

Using Winsby’s customer satisfaction survey program, our clients have seen 20% higher retention, 49% more customers, and 123% greater revenue growth over 5 years compared to those who are not using the program. 

Customer internal referrals 

Focusing on customer referrals means making sure your customers are buying everything from you—parts, service, rentals and equipment. Equipment dealers have multiple departments that are almost like different businesses. The good part about that, though, is that a customer can come in for a part, and then they become a potential customer for the service or equipment. The more they purchase from you, the better your customer retention rate will be. 

How can you increase internal referrals? 

  • Understand customers’ expectations— turnaround time for parts and equipment deliveries and service protocols. 
  • Then, you can meet expectations, or manage them if meeting them isn’t possible. 
  • Always call the customer with updates before they contact you.

Ensure you have a consistent lead flow 

Another critical piece of improving your customer retention rate is properly managing your lead flow. Your sales reps need to identify customers at risk consistently, then contact and engage them. At risk customers are current customers that you’re in danger of losing. These are people who start purchasing less and less from you, and eventually they could go to one of your competitors. Customers that are at risk typically haven’t purchased from you in over eight weeks. By reaching out to them, you can encourage them to come back to you to fulfill their needs. 

Engage your customers and convert prospects

You should also be regularly sending out emails to your customers and prospects. In our experience, customers on an email list buy two to three times more often than those who are not receiving marketing emails. By putting your brand, products, and services in front of customers, you’ll stay top of mind and your retention rate will increase. 

First, call customers and prospects to confirm decision makers’ emails to expand your list and keep it current. Then, send emails at least twice a month and show all your capabilities: parts, service, rentals, new and used equipment. It’s also important to identify your website visitors. Distribute leads who engage with your emails or website to your sales reps automatically to reach out to and determine what they need. 

Plus, when you engage with customers, always answer your phone and always say “YES!”. 

Measure and forecast 

It’s important to look at your past to predict your future. When it comes to improving your customer retention rate and achieving consistent growth, you have to have an idea of where you’re at and where you’re headed. At Winsby, we forecast the growth of Active Accounts for the next 12 months, based on patterns during the past 36+ months, by branch and by department. You’ll learn:

  • Expected losses and gains of Customers
  • Expected number of transactions
  • Expected revenue

You can then use the forecast to develop a plan of the action to take to improve your customer retention rate.

Conclusion 

Retaining your existing customers is just as important (if not more important) than gaining new ones. Use all the tools at your disposal: customer satisfaction surveys, internal referrals, email marketing, consistent lead follow up, and always trying to say “yes” to your customers. 

If you want to increase your customer retention rate and take advantage of all your possible tools, then contact Winsby today! We’ll help you implement a plan quickly. Contact Winsby Today.

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Why Customer Satisfaction Surveys Are Important For Equipment Dealers

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Why Customer Satisfaction Surveys Are Important for Equipment Dealers

Our new guest writer, Debbie Frakes, is the Managing Director at Winsby Inc. where she has been helping Business to Business (B2B) companies grow for over fifteen years. What works is constantly evolving, but Winsby is always testing new concepts to determine the most efficient and most cost-effective ways of generating business. Today she shares why customer surveys are important for equipment dealers.

The best way to improve your heavy equipment dealership is to understand what you are currently doing well, what is satisfactory but could use improvement, and what areas need to change in order to retain more customers. The easiest way to gain this information is through customer satisfaction surveys obtained by phone. A phone call assures that they are being thoughtful in their responses, rather than clicking through an email survey without reading the questions carefully. Plus, you receive excellent feedback about what went wrong and what went right in recent transactions. It’s important, too, to ask specific questions relevant to the type of purchase that was made—parts, service, new or used equipment, and rentals. You will have insights on how customers perceive your business and where you need to improve.

How phone surveys improve your service for heavy equipment

  • Increase your customer retention by 30% – 40%
  • Identify any problems quickly
  • Show your customers that you want to know what they think

If you’re wondering whether your dealership should conduct customer satisfaction surveys, take a look at the numbers. For dealers that conduct surveys regularly, compared to those who don’t, customer retention rates are about 30% to 40% higher. The reason is simple: those dealers receiving feedback on a regular basis can improve every part of their business, from heavy equipment service to sales to rentals to parts, because they discover what is wrong with their business, and they can react quickly.

With phone surveys your company can solve problem areas and issues before your customers take their business elsewhere, because they quickly become aware of the problems. If customers have issues with your services or process consistently, most of them will just leave without saying anything. When called for feedback on the most recent transaction, customers invariably are generous with compliments, which employees appreciate, and give honest reactions to any subpar performances, with details.

Why are phone surveys more reliable?

The feedback in customer satisfaction surveys should be obtained by phone, because customers typically provide more reliable answers, compared to email surveys. At Winsby, our team will usually reach a customer over the phone on every third call. And then once we are talking to them, about 97% agree to take the phone survey. This rate is much better than responses for email surveys, for which a good response rate is 2% of recipients. The other benefit of phone surveys is that they are interactive; your customers can fully explain any issues and the caller can ask follow up questions. For email surveys, we really aren’t sure whether they even read the questions!

It is more effective to use a third party to handle the surveys rather than someone from your dealership. The reason is that most customers are more honest with an outside person and will be more comfortable explaining problems to them instead of an in-house employee or someone they have worked with before.

How phone surveys work

The first step in developing a survey for an equipment dealer’s customers is to develop an effective calling script. Ask relevant questions covering what your customers care about and what is most important in your business. Key areas for dealers are typically heavy equipment service capabilities and availability, parts turnaround time, rental equipment availability, and new machine inventory.

Once you have your script, it’s important to speak with about 10% of the customers who were invoiced during the prior month. Record all the responses and follow up on any negative responses or negative scores immediately. Any departments or employees that are complimented need to hear the positive feedback. And any departments or employees that are named in negative comments should be told details as soon as possible. It is always better to contact the customer and apologize. Ask what you can do to make it right. Invariably, those customers are grateful that you cared enough to contact them and correct what the problems were, and they become extremely loyal customers. Had you not known about the problem, though, you would have probably lost them as customers.

How does your dealership benefit?

Customer satisfaction phone surveys make it possible to improve every aspect of your business, from heavy equipment service to parts to rentals to sales. These surveys help you understand what your customers think about you and your processes. The information you gain will allow you to fix problems fast and prevent any negative word of mouth or posting of online reviews.

Winsby compiles the 1 – 5 star scores and publishes one overall rating online, along with the individual scores and comments, providing feedback from actual, verified customers. Many of the online review forums, like Google, allow fake reviews to be posted from people who are not even your customers, and they make it difficult to have them removed. The compiled scores that Winsby sees for the equipment dealers are invariably over 4 stars. The reason is simple: anyone who is surveying their customers regularly cares deeply about how their customers are treated . . . and any problems are corrected quickly at the dealership. The result is retention of your customers increases by 30% to 40%.

Did you enjoy this blog? Read more great blog posts here.
For our course lists, please click here.

 

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