Love & Profit: 10 Ways to Transform Customers into Lustomers

Love & Profit: 10 Ways to Transform Customers into Lustomers

Turning customers into Lustomers™️, building a relationship that’s loyal and lasts, is more challenging in a technology-first world. The number of choices available for any one product or service makes it easier for customers to switch providers without giving it much thought. How can you generate customer ❤️, build loyalty, and grow your business?

Fill the emotional piggy bank

Creating long-lasting relationships, with customers or in your personal life, starts with curiosity, then time to act on what you learn. Stephen Covey, in his seminal The 7 Habits of Highly Effective People, shares the concept of an “emotional piggy bank” to build strong relationships. Be proactive to build trust, and you’re making deposits into the piggy bank. Do something that decreases trust and that’s a withdrawal. Your goal is to make more deposits than withdrawals to an open and positive working relationship.

How does this happen? Start creating Lustomers early in each customer relationship by demonstrating gratitude.

Treat each customer relationship with care and intention

Take the world of B2B Software as a Service (SaaS), for example. Solution providers sell their solutions to customers paying monthly or annually, essentially renting the technology. Customers don’t actually own anything, and risk being less invested in their vendors’ corporate health. Solution providers better accept the burden of generating customer love and loyalty, because switching costs are low until the technology is widely used.

If this is your market, the first step is to create an onboarding process that makes it easy to begin using your technology. Good onboarding alone has multiple parts—

  • A straightforward training program for new users
  • Support to answer questions — whether it is live support or a customer-only video library
  • Opportunities to give feedback on the process

If you onboard successfully, you increase the odds that people will not only use the technology but use it often and well enough for it to become second nature.

After successful onboarding, the second step is to expand the scope for each user over time by gradually increasing the functionality of the technology. This way, customers are continuously receiving additional value, giving them a reason to stay.

Keep customers longer and you’ll be rewarded exponentially over time. Especially in the world of SaaS, where you can’t generally increase the frequency of transactions (typically locking in clients to monthly, quarterly, or annual renewal cycles), you must increase revenue with the other two levers in the Customer Lifetime Value equation–amount per payment and longevity of customer relationship. Payments increase as the quantity of users grows and when those users deploy additional functionality. And since increased payment in this case is a proxy for receiving value (why else would you add users or increase the work they do with the solution?), there is a highly positive correlation between increased use and increasing tenure as a customer.

This is best illustrated in the chart below which shows customer churn reducing as utilization increases. (Note this is a smoothed and anonymized chart based on actual data–it is not an exact representation of any organization’s real results.)

For sure, keep hunting for more customers. But for the customers you already have, get them activated, excited, and expanding the benefit they are paying for to increase the value of each and every customer. Growing customer ❤️, turning customers into Lustomers, is the least expensive and surest way to increase sales and profits.

Build around happy customers and reap the rewards

How do you add more useful capability over time to increase the scope of your service? The answer: talk to your customers. Find out what they want or need, and any other feedback they have about your product and their experience with your organization. By starting a conversation, you can find out what they are doing with your product, and what they find difficult. By continuing the dialogue and maintaining an ongoing relationship, you increase the likelihood of a long-lasting and loyal relationship.

The payoff for staying engaged with a customer over time? In addition to their business and their loyalty, you may also get referrals, references, and more. Referred prospects have a higher close rate, at a lower customer acquisition cost, than leads generated through other sources.

Customers who began as referrals tend to stay with you longer, possibly because they are already part of your community thanks to the customer who referred them. And engaged customers are more likely to leave reviews, give you good press on social media, attend conferences as part of customer panels, be in webinars, and attend customer events. They are more willing to come to sales kick-offs or internal events and motivate your teams. Engaged customers are the ones who will tell it to you straight when you have questions, whether direct, in focus groups, or in formal advisory councils.

Are you ready to increase customer loyalty and retention but not sure where to start? 3C Communications offers half-and full-day workshops to help your teams communicate better and build solid, lasting customer relationships. If this could be helpful for you, contact us for a consultation.