Translation :
Priority Dispatch ’ s customers stick with the company and account for a big chunk of the company ’ s growth . Cultivating those “ sticky ” customer relationships is vital to the company ’ s regular strategic planning process . “ Every three years , we revise our strategy to meet many different objectives ,” says Thomas . “ There are three pillars of our strategy that we work on . One is finding ways to deepen customer loyalty . We have a dedicated team in my organization whose job is to better understand what deep customer loyalty means and what we must do to cultivate and support it . It may or may not have anything to do with the pickup and delivery . It has a lot to do with taking the friction out of the relationship . It could be an invoicing innovation or smoothing a million other customer touchpoints , resulting in a more trusting relationship . Culturally , these discussions drive a lot of our decision-making . I think incorporating this into our strategy has been extremely helpful . It incentivizes organic growth ( i . e ., growth from existing clients ) over market share . That ’ s important to understand because , culturally , we value more business from existing customers over having more customers . Our whole team is incentivized to prioritize deepening relationships with existing customers . We have embedded this idea of creating sticky customer relationships in everything we do .”
The Idea of cultivating “ sticky ” relationships with customers was introduced in 2000 by Jay Abraham in his book Getting Everything You Can Out of All You ’ ve Got : 21 Ways You Can Out-Think , Out-Perform , and Out-Earn the Competition . He defined the sticky customer relationship as one built on solid and lasting connections that encourage repeat business and loyalty . The concept resonates with Thomas : “ We define the stickiness of a customer relationship as a measure of how likely that customer is to continue buying our services over time , even if the market becomes more competitive . What ‘ sticky ’ ultimately means to me is finding ways to cement those relationships , so they stay with us over a period of time . They are loyal . They grow with us .”
He points out that building that loyalty has many components that can change over time , ” Sticky , for me , is situational because you may have components that are attractive temporarily , but those components aren ’ t static . I think of it like a marriage . You can have a tough time , but you evolve and find ways to succeed together .”
Why Sticky Beats New
Priority Dispatch ’ s numbers prove that sticky customers stay and account for growth . Cultivating them ultimately is better for the bottom line . “ I think we all know that a new customer development is three to five times more costly than organic growth ,” he points out . “ It ’ s expensive to bring on a new piece of business . In addition , when you bring on a new business , you often do it through an RFP process . And that RFP process dilutes any value proposition you bring to the market . It often just boils down to price . The RFP process dilutes your ability to communicate and share what ’ s special about your company and its people . There ’ s no way in that process to bring in our passion . Or how our culture supports the idea of long-term relationships .
summer 2024 I customized logistics & delivery Magazine 17