Treat your customers well, your repeat customers better

An example of really bad customer service…

I had to purchase some hard drives for a server few months ago. Due to the nature of the setup, I needed to get the exact same drive models that were currently being used in the server. I went to one of the companies that I routinely purchase products from and placed my order for 2 hard drives. The next day I received an email from the company stating that they could not ship my order because my Paypal address was unconfirmed. Having moved 1 suite down the hall (about 75 feet) in our office building I explained to them that we were in the next office down, and that I didn’t want the drives to get delivered to the previous suite…

Well, it didn’t matter that we have bought thousands of dollars in server and computer hardware in the past few years, or that the address was 1 suite number down the hall, or that I actually called them. They would only ship to a confirmed address which lost them my order and possibly my future business.

This cost them $10, and they probably lose 20 more orders from me over the next 5 years.

An example of really good customer service.

I own a number of fish tanks, and I purchased some supplies including a very low cost automatic timer from a well know online pet supply retailer around the same time as the hard drives. The timer didn’t work properly, and in the midst of a busy schedule, 9 birthdays, 2 business trips, and 2 vacations I forgot to contact them about getting it replaced. Finally getting around to it, I read their return policy and it understandably said I needed to return the dysfunctional equipment to them. Since the shipping would cost about the same as re-purchasing the item, I gave them a call and asked if I really needed to send it back… Ah, I found out that I was past the refund point by a month and a half…

Even so, they decided to replace it for free and they didn’t require me to send back the broken one. This is what I call above and beyond customer service, and it’s guaranteed that next time I need something for one of my aquariums, they’re the first place I’ll stop.

This cost them $10, and they probably get 20 more orders from me over the next 5 years.

These are polar examples of a very important concept… Your existing customers are not and should not be treated like a your new ones!

It’s a well accepted principal in marketing and business in general, that your existing customer is easier and cheaper to sell to than a new customer. Additionally for ecommerce, selling to your existing customer poses a significantly lesser security and fraud risk than any new customer, especially in a case like this where the customer has placed several orders over several years.

If you want to create a remarkable online business, create the best experience for new customers, and make it even better, easier, and more efficient, for repeat customers.

There’s no reason to assume all customers should be treated the same. The majority of shoppers only place one or two orders with a website (Unless we’re talking about someone like Amazon). For this reason, you should make it as easy as possible for repeat customers to order from you, and you should give first time shoppers reasons to come back. It’s significantly cheaper to entice an existing customer to make another purchase than to go out and find a new customer.

If you think you’re significant enough that most of you shoppers wont go somewhere else if the price or service is much better, think again.

The real reality check…

Sure my business is insignificant in the long run. Ewiz may have only made a few hundred dollars in profit from me over the past few years. However, assuming that this blog gains no popularity or traffic over the next year, somewhere around 150,000 people will have the opportunity to read this article on my insignificant little ecommerce blog. 150,000 people will know that Drsfostersmith has outstanding customer service and ewiz’s customer service absolutely sucks. That’s 150,000 people, possibly current customers that could decide to shop somewhere else, or in Drsfostersmith’s case, 150,000 people that could decide to make their first purchase…

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  1. Mike Millan 25 Mar, 2010

    One thing i wanted to add was that in recession customers (even the repeated ones) get choosier and sensitive. It is therefore very important to not only retain but also expand the customer base.

  2. Tula 25 Mar, 2010

    I think part of the blame for the first problem can be placed on Paypal. They have very restrictive policies for covering payment problems and one of them requires shipping to a confirmed address. If someone ships to an unconfirmed address, they receive no Paypal protection for it.

    Now, the company could override this for a repeat customer, but I find I can’t fault them for complying with the policies of their payment service provider.

  3. Redspell 3 Apr, 2010

    Very interesting post.

    As Tula states, the issues regarding payments received via paypal always puts online sellers on their back foot. There are so many instances where e commerce stores can lose money when using paypal you can’t really blame one for being extra meticulus (even if it was for a $10 sale).

    Fair play to the online retailer in your second example, a good example of customer service.

  4. Online Bidding 7 Apr, 2010

    The subject “your repeat customer better” is the most important subject in regard to the Business Development opportunities. Now We need to analyze what strategies we need to adopted to get the potential customer on our website and the customer will become our repeating customer.


  5. Chris Q 23 Apr, 2010

    Nice article, and some good points. It’s very true that word of bad customer service spreads much further than that of good service.

  6. Paul 23 Apr, 2010

    Customer Service is very important, even some of the bad customers you need to treat good, as word of mouth can be damaging to buisness, the ” customer is always right” attitude is i think crucial for any successfull buisness.

  7. Hey first thnaks for sharing the article. Really the word of bad customer service spreads much further than that of good services.

  8. E-Ticaret 24 May, 2010

    This is an interesting post, mostly true. i think that, any company should make their each and every customer feel that they are one and only one customer of the company. it doesnt matter new or repeat.

  9. Online Store Coach 19 Jun, 2010

    Agreed. Not enough online retailers focus on their current customers. Too bad because that’s where all the profit is.

    I’l like to add to this conversation the concept that not all current customers are created equal. So, if you are to focus on driving repeat business, then make sure you’re focused on the best customers (best lifetime value or affulent) vs. a broad approach to go after all repeat customers.

    Keep up the good posts.


  10. I think you are absolutely right. Repeating customers will trust transactions however you should always develop your site with usability and security in mind. Studies show that over 70% of visitors that leave with no transaction left because of failed checkout pages or they feared giving out their credit card information because they did not feel it would be protected. Security and Usability go a long way with eCommerce sites. Thanks for the post.

  11. Peter Harrington 3 Sep, 2011

    In our business – http://www.alwaysriding.co.uk, we make use of a nice open source system called http://www.mailbeez.com, which allows us to send loyal customers personalised email offers after a certain number of orders – certainly helps us to reward loyalty, and our customers seem to really appreciate it.

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