The Green Sheet Online Edition
May 14, 2007 • Issue 07:05:01
All-star processing â€“ Part II: Retaining your MVPs
Baseball season is upon us. And your favorite team's most valuable player (MVP) may make the difference between a winning and losing year. It's no different in our industry. Finding and nurturing MVP accounts is the best way to grow your revenue line.
Let's face it: We work in a "you're as good as your last sale" industry. The emphasis on bringing in new accounts is ubiquitous.
Whether they are walking the floor at the Electronic Transactions Association's annual expo or sharing drinks at the trendiest local bar, all merchant level salespeople (MLSs) tell stories about winning difficult-to-close merchants or signing up thriving new referral partners.
Merchant acquirers offer serious short-term financial incentives - from sign-on bonuses to loan programs - for salespeople who bring in major new accounts. There are enough books on how to bring in new business to fill a library or two.
Smart salespeople are constantly on the hunt for merchants who could use a new processing partner, as well as new, growing industry segments that would benefit from accepting credit and debit payments.
Balance is key
But in the hunt for new customer accounts, many ISOs and MLSs miss out on the guaranteed profits and financial security that come from keeping current customers highly satisfied.
If you devote resources to winning new business at the expense of servicing existing clients, you risk losing your bread-and-butter accounts: retailers that know your company, understand the services you provide and will boost your profit margins with residual checks for years to come.
For long-term success in our industry, it's essential to strike a balance between prospecting from new leads and growing organically from plus-selling and servicing your core merchant base. These are the MVPs on your processing team.
Here are four simple ways to retain customers by keeping them happy.
1. Be honest
It's been said that integrity is its own reward. But it can be very lucrative as well. Everyone likes to do business with people they trust. A solid reputation for ethical behavior and fair dealing will get you further in the long run than any number of hit-and-run sales strategies.
Resist the temptation to get a big payout from a new customer by charging hidden transaction, processing or cancellation fees that your customers are not aware of when they sign their merchant agreements. The moment merchants find out you've taken advantage of them, they will switch processing partners.
While fear of a large cancellation fee may trap customers into staying with you for a short time, they're sure to find a better deal elsewhere with a processor that will save them enough money to pay that cancellation fee and still profit _ leaving you high and dry.
Also, make sure you don't offer benefits and services your company can't deliver. It is shortsighted to gain merchants with false promises only to lose them six months later when they learn you have misrepresented the customer service or technical support your company provides.
It may be difficult to focus on a customer's long-term revenue-generating potential rather than the instant gratification of signing up a new account. But the rewards ultimately will speak for themselves.
2. Find the right program for each customer
Everyone likes customized service - from "hold the pickles" to "take a little off the top." Retailers are no exception. A reliable way to keep merchants satisfied is to provide them with processing plans specifically tailored to their business needs, capabilities, competitive advantages and vulnerabilities.
The best way to sell merchant processing plans that fit like a glove is to spend time getting to know their businesses.
You won't need to put on a uniform and work behind the counter. Spend an hour or two pouring over financial records. This effort should provide all you need to know about how and when a given merchant accepts electronic payments and how the merchant's system can be improved by your company's services.
By developing a processing system that works well with your customers' businesses - and doesn't sign them up for services or equipment they don't need - you can ensure happy partnerships that will guarantee long-term financial success for you and your customers.
3. Offer referral bonuses
Studies have shown that word-of-mouth or personal referrals are by far the most persuasive means of getting customers to sample new products or patronize new shops. Why not mobilize your current merchant base by offering referral bonuses for every merchant lead who ends up signing with your company?
Referral bonuses are extremely cost-effective. Since referrals require little time investment from merchants (they provide only a name and phone number), they will welcome a couple of months' free processing as a reward.
You'll quickly make that back in processing fees when new referred customers are boarded and accepting credit cards.
In addition to bringing in a stream of new business, referral bonuses enhance merchant satisfaction. There's no greater incentive to keep merchants processing with you than putting them on your payroll. Referral bonuses are a simple, inexpensive way to do just that.
4. Keep in touch
Another way to boost customer retention is the simplest yet most frequently overlooked: Keep in touch with your retailers, and not just when there's a crisis or when you have something new to sell.
Simple cards and letters at holidays, birthdays or even processing anniversaries are an easy and surprisingly effective means of strengthening the bond between you and your clients.
When you have breaking news, such as a new product or service, send information to your best merchants with a handwritten note indicating you are offering the new product or service to them first.
Drop in to remind merchants about your referral program. Retailers are always happy to receive visitors who can help them make more money.
A simple rule to remember: If your merchants only see you when things are going poorly, they will associate you with negative events and crises. If they also see you when business is booming and their processing is going well, they'll think of you in a much more positive light.
A longtime partner is there in good times and bad. By following these tips, you'll ensure long-term, big-league success from the MVPs that are already the cornerstones of your processing portfolio.
Marcelo Paladini is the President and Chief Executive Officer for Cynergy Data, a merchant acquirer that distinguishes itself by relying on creativity and technology to maximize service. Cynergy offers its ISOs: Vimas, cutting edge back-office management software; Vimas Tracking, a ticketing system that makes responses to customers fast, accurate and efficient; Brand Central Station, a Web site of free marketing tools; plus state-of-the-art training, products, services and value-added programs, all designed to take its ISO partners way beyond their competitors. For more information on Cynergy, e-mail Mike Grossman at email@example.com.
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