Repeats Repeats Repeats

　　It takes a lot of investment in promotion, product design, operations, and lots of other stuff to attract and be ready to serve a new customer. Then, when you actually attract a new customer, you may have to educate him or her about your products, sales, and business policies. You may have to do a credit check, set up a new account for the new customer, create a new file with a new label just for that new customer, and gather lots of information about that customer in order to provide them with the service they expect.

　　Add up all that effort, and you can see that adding a new customer to your business can take quite an investment in time, money, and energy. Business experts who study this kind of thing figure that it costs something like five times more to serve a new customer than a repeat customer.

　　Here are two very important truths about why creating repeat customers through outstanding service is worth the trouble:

　　1.Repeat=Lower Expense

　　Most organizations spend much of their time and energy acquiring new customers. They advertise. Certainly, a business can grow by adding new customers. But it might be much more profitable by spending more energy encouraging existing customers to buy again and again.

　　Here's why. Existing customers already know your company. They have an idea of what it stands for. They have sampled the quality of its merchandise. So it should cost far less-maybe even nothing-to encourage satisfied customers （you did satisfy them, didn't you?） to return time and again. To attract great masses of the uninitiated to try your company for the first time costs far more. They don't know about your business and they certainly don't care about it. So in order to get their attention and motivate them to give you a try, you often need to buy ads, send countless mailings, offer steep discounts, and increase sales compensation.

　　Would you rather spend $10 on ads, mailings, special discounts and the like to attract a new customer for their first $50 purchase, or 50°E to mail a customized reminder letter to your repeat customer who may well make two or three additional $50 purchases with nothing more expensive than some heartfelt words of encouragement and appreciation?

　　2.Repeat=Revenue

　　Supposing a customer goes every morning to the same convenience store for a large coffee. He spends about a dollar on it. To the clerk completing the transaction on any given morning, this is a $1 customer.

　　But this same customer also makes a habit of returning at lunch and buying a prepared sandwich, a soda, and a snack for the afternoon, about a $6 transaction. Sometimes he brings his friends in the store and they each spend a few dollars for lunch, too. Then, on his way home at night, he often stops at the store for another cup of coffee and maybe picks up a half-gallon of milk.

　　So in an average week, this “$1 cop of coffee customer” actually spends somewhere around $30 to $50 in that convenience store, not to mention whatever his buddies spend on their lunches. So in an average year, this $1 transaction guy is actually visiting the store two or three times a day, about four days out of the week, and dropping upwards of $1,500 per year! Imagine if this same customer continues to return day after day, year after year for as long as he lives in the area （like 15 or 20 or more years）, That $1 cup of coffee customer may be worth some 20 grand to that store.

　　If you owned that store, wouldn't you want each of your employees to understand that each $1 customer could represent a whole lot more potential revenue? And wouldn't you want to made sure that mo $1 customer, potentially worth 20 grand to you, was ever driven away forever by a sour cup of coffee or a sour employee?

　　And while the products and the numbers are different for your business, isn't the principle of creating a repeat customer equally true and important for your business?

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