Friday, February 28, 2014

Increasing the Lifetime Value of Your Customers

The easiest way to grow your business is to increase the average lifetime value of your customers. That's the focus of this final part in our three-step marketing plan to get and keep customers. There are three things your marketing plan should cover to increase the average lifetime value of your customers :
  • Increase the number of trips per year
  • Improve the average profit per trip
  • Keep customers active longer
Increase the Number of Trips

The easiest way to increase the average number of trips is to talk to your customers and ask them, "Where should you be this month"? Those words are carefully chosen.

Most business travelers will admit that there are customers they really ought to visit in person; or suppliers they should see face-to-face; and company facilities they ought to visit more often. The reason they don't go is that the trips are so time consuming and such a hassle that they routinely postpone trips until some crisis arises and they can't put it off any longer.

So instead of asking the customer if she has any upcoming trips which she has already decided to take, ask instead if there are any places she really ought to be and why not use your service to conveniently get there and back?

Stop talking and wait quietly while your customer thinks about the answer to your question. After a few minutes, the customer will give you a trip he or she didn't even know they were planning to take!

Improve the Average Profit per Trip

Surprisingly, this has nothing to do with raising your prices. This is all about an add-on sale. If you were selling suits, you'd know all about add-on sales. Man comes in to buy a suit. Walks out with a suit, two shirts, three ties, a belt, six pair of socks. Average profit per sale just grew sky high.

But what can you add-on to a jet charter? How about a stop along the way? How many times do you take a customer round trip from here to there, non-stop? Most of the time, right? In fact, non-stop travel is one of your best selling features.

But on the way back from that morning meeting, are there any customers, suppliers, prospects, or employees the client might want to stop and visit? Not only would your revenue go up, but so would your margin on that extra leg. 

The next time a customer books a round trip, why not ask them if there's anyone they'd like to stop and visit on the way out or back? Then watch your average profit per trip soar!

Keep Customers Active Longer

Quick story. I took three charter trips with an operator over a 2-year period. Operator never once called me and thanked me for my business. I never got a card, letter, email, anything. (Well, to be honest, they did send me receipts for my credit card payments.) I was pleased with the service and had no complaints. But I also felt no loyalty! The fourth time I needed a trip from that market, I called one of their competitors.

Some customers stop flying with you because their circumstances have changed and they don't need, or can't afford, business aviation anymore. It's more likely, however, that the majority of the customers who have gone silent have switched to your competitors.

To keep customers flying with you, and away from the competition, you need a way to stay in touch. Use whatever works best for your skills and your budget. Call 5 customers a day. Send them a personal note. Put together an email blast. But for heaven's sake, stay in touch with them and let them know you value their business and would be honored to have more of it.

In Case You Missed It

This was part three of our series on writing an effective marketing plan for your air charter business. Part one was all about getting customers to raise their hand and say, "I'm interested. Tell me more." Then in part two, we had ten suggestions for getting customers from "Hello" to "Sold."

I'd welcome comments and questions on any of these three posts. Thanks for reading them!

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