How to keep your customers, even as they cut back on spending

The buzzwords come out in force during a recession.

Forget buzzing — they hum.

Community. Relationship. Trust. These are the words that dominate conversations about how businesses can best weather a recession.

In other words, customer service becomes king. Business owners will tell you: The relationships forged with customers can go a long way when consumers cut back.

Steve Kropf, co-owner of the bookstore and coffee shop A Gathering Grove in Everett, can attest to that. He minds the store during the day while his wife works her day job at a bank in Seattle.

From behind his coffee bar, he sees the same faces return again and again — and he thinks it’s largely because of the personal connection some customers develop to a favorite businesses.

“There’s such a community here in Everett,” he said. “People want to support small business.”

After all, an owner-staffed bookstore still in its first two years of operation isn’t generally the place you find a great bargain.

That’s what Amazon.com is for, Kropf said.

The trend to improve service isn’t specific to small businesses — or even medium-sized companies. Experts put it this way: If customers are going to spend the same amount as before, they want more for their money.

In 2008, amid profit declines and ramped-up competition from less-expensive coffee companies, the Starbucks Corp. closed 7,100 stores nationwide for a three-hour training session meant to teach employees how to create a better “Starbucks experience.”

The focus was on making a better cup of coffee. And customers reported cheerier baristas for months after the training session.

But when recession strikes, layoffs often mean customer service falls down companies’ priority lists. With fewer employees and sinking morale, that personal touch can be difficult to maintain.

Brand loyalty suffers when consumer spending drops, according to a study released this year by Catalina Marketing Corp. Regardless of a customer’s preference for a certain brand or service in the past, they’ll opt for generic brands and cheaper services when layoffs and pay cuts come calling.

Mike Bickford, co-owner of Bickford Ford in Snohomish, said maintaining a reputation for good customer service is key to weathering economic slumps — especially in the recession-plagued auto industry.

“It is very much a relationship business,” he said. “It really is about taking care of your customers.”

Read Amy Rolph’s small-business blog at www.heraldnet.com/TheStorefront. Contact her at 425-339-3029 or arolph@heraldnet.com.