When kids plead their parents for a new puppy it generally comes with plans and promises to take great care of it. “I promise I will walk it, feed it, clean up after it, etc.” Parents finally relent and the new puppy arrives. Its arrival is generally followed with squeals, hugs, expressions of gratitude, charming words, lots of close attention, and eagerness to do all the important puppy duties.
Brand new customers often get similar treatment. There is an eagerness to get a new account, lots of gratitude, charming words, TLC and close follow-up. But, if you have ever been the parent of a child with a new puppy you know the “puppy stage” is short lived. Cute puppies become ordinary dogs. And, the glee of walking the dog and cleaning up after him or her becomes an uninteresting, got-to-do chore. Interest can wane; attention can be reluctant. Kids sometimes only want the joy side and not the task side of dog tending.
My business partner walked into his UPS store where he gets his corporate mail. They were promoting three months free rent for all new customers who would sign a one year contract on a mail box. “I have been with you for three years,” John told the clerk on duty. “Do I get a nine month credit?” The clerk was confused and completely missed John’s point.
The lesson is an important one. Research shows the cost of acquiring a new customer can be five to ten times the cost a keeping a long-term customer. And, as new customers become long-term customers their worth increases—they buy more, spend more, advocate more, and generally are less expensive to serve since they do not require customer training when they deal with you.
The excitement of getting a new customer can be thrilling, especially in a super competitive market. And, like getting a new puppy, they can bring the joy of getting a new friend. But, long-term customers, like a loyal dog, can bring worth and special value. Take care of your seasoned customers and they will take care of your bottom line and marketplace reputation.