Click for Source

$199 for Existing Customers

$99 for New Customers

 

 

 

 

 

 

 

 

 

Have you ever been in the market for a new product or service, and found that your current provider offers a much better deal if you’re a new customer than an existing customer?  I recently bought a new smart phone from Sprint, my current provider, and was discouraged to find out that I’d be paying $100 more simply for being an existing customer.  The lowest price I found for my phone was about $200 at Radio Shack, while Amazon sells it for $100, with the condition that you must open a new line of service.

As an entrepreneur and small business owner, I truly believe that retaining customers is much more important than getting new customers.  When potential customers decide to make their purchase with a different vendor, the cause may be attributed to a number of factors: marketing, pricing, quality, value, differentiation of products or services, etc.  When customers decide they no longer want to be your customer, it’s usually because they don’t feel valued as a customer.

That is to say, most customers will continue to purchase from you if they believe you offer better customer service and value them as customers.  Most customers will even pay a premium for your product or service if they find value in the relationship you’ve established.  More importantly, they will recommend you to their friends and family, which is likely to result in more sales to more loyal customers.

As far as my Sprint dilemma is concerned, I decided to stick with them for two more years, but only because my plan is $20 per month less than their competitors.  Therefore, switching services would be much more costly in the long-run. However, their “better pricing to new customers strategy” does not make me feel valued as a customer.  They have yet to gain my loyalty.

 

Advertisements