Where once customers might have only bought from one brand – and have defined themselves by that brand – or felt an allegiance to one store and the people in it, today the market has fragmented to the extent that ‘shopping around’ is now the norm.
Has this more canny approach to purchasing found its way into the print market, too? Well, Matthew Peacock, director at consultancy Active PPP, says the need to retain customers is nothing new, but it has got more complex.
“It is an old sales adage that it is much cheaper to retain an existing customer than find new ones, so in all cases I would expect printers to make an effort to encourage repeat business,” he says.
Nick Devine, The Print Coach, explains further: “There are in fact four levels of customer loyalty, not just one as most people assume.
“First, you have unhappy clients who will leave you. All companies have these if they have a busy operation, it’s unavoidable. However, you cannot afford to have any of your tier-one customers in this group – ie the top 20% of your business. Secondly, you have the happy but not loyal. These are the clients that most people assume are loyal. They may return to you on a regular basis, but they are equally open to competitive bids from alternative suppliers. They like you, but they don’t love you. For most printers this is where the majority of their customers currently sit. Then you have loyal customers. These are the companies who keep buying from you and don’t take calls from competitors. Finally you have the advocates. These people love what you do and pay premium prices because they value you. They will promote you behind your back, give you great referrals and compelling case studies.
“Your mission is to get your tier-one customers from the second level to the fourth level of customer loyalty.”
That’s easier said than done – retention is not an exact science. Whether it be loyalty cards, repeat customer benefits, persistent low pricing or great customer service, or none or all of these, working out what is right for your business – and what will work consistently – is difficult.
“The way printers look to retain customers should depend upon the nature of their business,” says Peacock. “A traditional craft printer may rely on personal service between customer and printer. In contrast, a highly automated web-to-print business producing personalised greeting cards will minimise human-to-human interactions and may include automated repeat-business discounts in the pricing system.”
Traditionally, the print industry loyalty strategy has been good products at good prices in good time. And occasionally a good jolly for the really important clients.
To some degree, that basic approach is still valid, says Lesley Graham, production manager at Wirralco.
“We have not needed to offer loyalty schemes or discounts on repeat work,” she says. “We have found most of our customers are not only loyal but recommend us to others. Mostly because of the way we operate. We have always been open and honest with our customers and they know this.”
Is that enough today? Graham admits some customers have gone to competitors chasing lower prices, but she says they did eventually come back. She explains, though, that by going the extra mile beyond the above standard print offerings, you can limit wandering customers to just a small proportion of your client base.
“We offer to help our customers by way of helping with things like artwork,” she says. “Also if they are sponsoring a charity and supply the artwork we usually offer to cover the cost of print even though we know our name cannot be added as we are trade only. We have found our customers really appreciate this help.”
The extra mile
No matter what sales business you are in, ‘free assistance’ like this is increasingly important to customer loyalty. John Lewis is a prime example. Its very successful business model is to not just provide a product but to provide an advice service for that product too. People go back to buy things at John Lewis as a result. Print’s increasing adoption of a much more rigorous and broad customer service offering is moving towards performing the same trick. Wirralco’s extra help is a prime example, as is the GI Solutions approach.
“Our customer loyalty is built on putting customers first and considering their needs when it comes to investments and improvements in products and services. Constantly improving how we support customer communication requirements keeps our customers happy,” says Matt Lawrenson, marketing executive at GI Solutions. “Also, we provide as much help and support as we can to develop new ideas. For example, offering a free resource showing format ideas and we also run monthly and ad hoc seminars to address training for subjects like direct mail in addition to subjects like Mailmark where we run a joint seminar with Royal Mail.”
It sounds expensive, but as Peacock said, it is not as expensive as having to go to market to try and tempt in new customers. So is there more printers could be doing?
It is useful to look at what the kit manufacturers are doing in this area. As the market for new machines has got ever tougher, those selling equipment to printers are arguably further along the retention strategy road than the printers themselves.
Peter Bray, managing director of Durst UK, says the shift his company has made is to be more reactive to the customer – not just the customer is always right about a product, but the customer gets to determine what the product actually is.
“During all our engagement, right from the start of a sales process, we play close attention to customer applications so we ensure that our system meets their exact needs,” he says. “Gone are the days when you did a sale and moved on the next. We closely analyse our customers’ needs with strong UK back-up service to ensure they can grow their business opportunities. It’s this sort of approach that helps us gain repeat orders.”
Mark Hinder, Konica Minolta’s head of market development, Europe, warns that it is this close attention to customer need, not discounts, that produces loyal customers – so those 15% off vouchers for repeat customers should be scrapped.
“We should not just give away additional discounts,” he advises. “We should consider the true meaning of value, which in turn will deliver loyalty. People recognise that all customers are now used to loyalty schemes, such as those prevalent in the retail industry, to entice customers to continue to purchase from them. But are we not in danger of fuelling the debate that print is just a commodity and that the only choice for customers is getting additional discounts in a loyalty scheme? I believe that loyalty can be earned by focusing on customers’ needs and providing them with value that is delivered in the form of innovation. That, in turn, will create a new wealth of opportunity in itself.”
John Corrall, managing director and founder of inkjet integrator IIJ, agrees: “Customers want us to provide expertise and effort into helping them work out whether a new idea is feasible. Often this means doing a lot of print sample work. Testing to see if we can print what he wants where he wants it at the speed and cost-per-print to make it economic. To me this is a lot more valuable than a discount. Opening up new markets for new business opportunities for our customer has huge value.”
Valued service
While the revelation that massive discounts will not be forthcoming from manufacturers may be disappointing, most printers will appreciate the point made: you don’t want hundreds of loyal customers paying below the print price, you want hundreds paying what the job is worth and sticking around because they value the whole service the printer is offering.
“Gimmicks and even dishonesty can be effective in the short term but not in the long haul. In the end, customers loyalty is gained and retained by honesty, value for money and good service,“ says Peacock.
“Good service” is, however, a very ambiguous term. One printer’s good service will look woeful to a different customer. That may well depend on the market the printer is operating in: different sectors have different customer expectations. So how do you know what your customer wants?
“Knowing what adds value for customers is fundamental to business success but I’m constantly surprised how little effort companies make to understand their customers,” says Peacock. “Usually the printer’s understanding is based upon intuition and experience but often includes false assumptions.”
He explains that one way of becoming better informed is a customer survey.
“Customer satisfaction surveys are notoriously difficult and if done badly can actually irritate customers, as well as waste time. But well designed surveys with some subtle incentive, such as offering money for a respectable charity if surveys are returned, can work. Following up orders with a quick, tactful and courteous call to ask whether the customer was satisfied can be illuminating and appreciated – but it depends upon the nature of the business.”
There is another way, and it is one increasingly popular with high-street retailers. It is also something Sarah Crumpler, Duplo UK marketing manager, says her company advises customers to get up to speed with as soon as possible.
“I’d encourage people to use a customer relationship management (CRM) system to monitor as much data as possible,” she says. “This will help log and track customer journeys from the initial interaction be it in person or online right through to the point of purchase and buying patterns. There are also a number of website analytic and tracking tools (or marketing automation tools) so that printers can see where traffic is coming from and the customer journey, whether it feeds through to a sale or they get lost at a certain point, this can then guide marketing decisions. There’s software for everything. The important criteria is knowing what you want to gain from using it and how you’re going to interpret and react to the data.”
OpenCRM is a company providing such software to the print industry already. “If the printer can preempt the buying rhythms of its partners then it means they will be better educated for their customer demands and also ‘in the right place at the right time,” says managing director Graham Anderson. “We do have some printers in our client base, both trade suppliers and end-user organisations.”
Tharstern also offers a CRM system and global sales director Lee Ward says just having the software is not enough, printers have to use it properly, too.
“The hard bit is working out exactly what it is that your customers value,” he says. “The easiest way to do this is obviously just to ask them. If you have a sales team, give them some key questions to ask and then get the answers in your CRM to be used later. This is actually one of the main reasons why we added custom fields to our CRM module; you can record any extra information you like about a contact – why they chose you as a supplier or what kind of loyalty reward they’d prefer, for instance. You can even record more personal details to help your sales team maintain their relationship with their contacts, perhaps which football team they support or where they went on holiday.”
He says this should be a tool referred to throughout the sales process, not just by the customer relations person or team in the office. “Mobile CRM apps are great for your sales team, it means they won’t forget to ask key questions and the answers can be input while on site.”
You then have to use all this information properly. “Once you’ve collected this information about your customers, you can use it to create targeted loyalty schemes that are rewarding your loyal customers in a way that they appreciate,” says Ward. “If you wanted to take this to the next level, then you’d need to consider using marketing automation software like Hubspot, Marketo or Pardot, which allows you to track how an individual engages with your website or emails, right down to the web pages they’ve been on or which links they clicked on in an email. Then you could really create something powerful by integrating this type of software with the CRM in your MIS. So, for example, if a prospect visited your pricing page or clicked on a particular link on an email you sent out, you could use the integration between Tharstern and Hubspot to have an automated alert sent to the relevant account manager, asking them to get in touch with the prospect.”
Peacock also advocates CRM systems, but he does have a word of warning. “They can be powerful but often fall into decline because they take a lot of work to keep up to date and may not integrate well with the company’s other computer systems, leading to the mis-matched database misery. It is more important to have simple effective sales records than a comprehensive but possibly muddled record of every conversation,” he says. But he adds: “Careful analysis of quite simple sales records can be illuminating and reveal useful patterns associated with markets, timing, sales people and so on.”
That message of careful consideration and everything in moderation is a good lesson for all the retention tips listed here. Yes, there are general things that could apply to every printer, but making them work effectively in retaining customers will require individual companies to try methods out and find out what works best for their customers. You’ll know when you get the right blend, as you will suddenly find yourself much busier than you were previously. And as it will be based on solid loyalty management strategies, you will have that joy of knowing that it is not a short-term, but rather a long term boost.
