Star performers, rejoice. This is your year. More than three-quarters of human resources executives polled recently by Challenger Gray & Christmas report that they are struggling to fill open positions—and 91% say that if the economy keeps expanding at its current rate, the war for talent will worsen. Unemployment is in fact expected to continue its slow creep downward in 2015, to 5.7% from 5.9% this September, according to the Philadelphia Federal Reserve’s most recent forecast.
That means bad news ahead for employers but good news for top producers, who will have real leverage in the coming year. Turnover costs are especially high for positions that are significant contributors to revenue—sometimes 200% of a worker’s salary. So it’s no wonder that 57% of the 4,700 companies surveyed in PayScale.com’s recent “Compensation Best Practices Report” cited keeping high-performing workers as a top business concern, up from 20% in 2010. “Just about every HR department should be discussing talent retention,” says David Card, director at the Center for Labor Economics at the University of California at Berkeley.
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One of the most common mistakes small-business
owners make is to focus so much time on attracting new customers that they skimp on the effort it takes to create loyal customers. That’s a mistake, because it’s more expensive to get new customers than to retain them. To develop and nurture a relationship with your customers, you have to communicate regularly and, above all, provide consistently over-the-top service.
For a story for Entrepreneur.com, I took a look at how three small businesses are keeping the customers they worked so hard to attract. One business uses a low-cost online service to send automatic emails to some 400 customers at any time, whether it’s to wish them a happy birthday, congratulate an anniversary or simply thank them for their loyalty. Another lets their customers watch the progress of their work in real time online. And the third uses Cardagin, a mobile loyalty and customer retention program, to send special offers to customers on their smartphones and reward them with loyalty points.
Other small businesses can mimic these smart customer retention ideas in order to keep their customers coming back. They all involve use of new technology, and for that, these small business owners should be applauded for their innovation.