Customers are naturally drawn to the business that offers them the lowest price. So how can you expect to compete against a price-cutter — without slashing your own profit margin?

The best way to consistently outperform your competition is by cultivating and maintaining loyalty among your customers.

Buyers get what they pay for

You know that adopting the sell-cheap approach unravels in the long run.

Short-term strategies like cutting costs or offering freebies might bump up the short-term numbers a bit. But the honeymoon will end quickly when customers soon discover they’re paying for those lower prices in other areas — through poor quality or follow-through.

Keep ’em coming back

There are three steps to drive customer loyalty:

1. Exceed expectations. Get a delivery there a day early. Enclose your business card with the next transaction, along with a “call me anytime” offer. Ask customers to complete a short survey on how well you do your job. Then share the results — and the changes you’re making to address any shortcomings.
2. Make an emotional connection. Customers no longer want to just be satisfied with their purchases. They want to feel like they have a business partner who’s taking care of them. Salespeople who develop a loyal following go that extra mile to show customers that help is available whenever it’s needed.
3. Put the needs of your customers first. Make it clear to customers that you’re seeking to meet their needs, not tell them what they need. Instead of focusing on your prices, credit requirements, etc., congratulate the customer for choosing you, and pledge to meet their needs.

Info: “Three Loyalty Selling Tactics That Drive Maximum Revenues,” freshrevenues.posterous.com

Tags: compete, credit, customer loyalty, loyalty, price-cutter, prices, profit, quality