smallbusiness.co.uk: Helping your business think big

Small businesses dealing with the public rely far more on customer loyalty than larger competitors, the government's business support agency has claimed.

Winning new customers can be significantly harder than keeping an existing customer and SMEs can undertake various measures to ensure customers return to their business over and over again, according to Denis Palmer, a spokesman from Business Link.

As well as simply talking to customers, Mr Palmer suggests small businesses introduce realistic schemes, such as customer clubs, as a marketing sales tool to maintain the loyalty of their customers.

'Talk to the customers – that’s a very important point for a shop. Don’t just serve the people, talk to them, ask them what’s good about what you’re doing, what’s bad, what can be done to improve the service,' Mr Palmer advises.

'There are lots of different things you can do, [such as] customer clubs, bringing customers together in a novel way [through] discussion boards and interactive elements on a website,' he adds.

Research recently published by the Chartered Institute of Marketing revealed that it costs up to ten times as much for an SME to win a new customer as it does to retain an existing one.