Retaining old customers is as necessary as acquiring new ones! As a lot of time, effort, and patience goes into customer conversion, the last thing a business would want is to lose them. Hence to succeed in the digital space, having strong customer retention strategies is essential.
In this blog, we will discuss about 10 effective customer retention strategies and its necessity for the long-term success of your business.These methods will help you increase customer loyalty, reduce churn rates, and ultimately, drive revenue growth.
So, whether you have small startup or a large brand, read on to explore the top customer retention methods that can help your business thrive.
Why Should Customer Retention Be A Priority For Your Business?
Studies show that a 5% increase in customer retention in business can maximize profits up to 25% to 95%. Can you now understand the necessity of customer retention and how much it can be profitable for your business?
Let’s look at the top advantages of customer retention to understand its necessity for most businesses.
Helps In Easy Revenue Generation
To generate profitable revenue, you need to retain your loyal customers – the ones that stick with your company for a long period of time. Bain and Company explain, with data, the advantage of loyal customers sticking with your brand. According to them, the average repeat customer spent 67 percent more in months 31-36 of his or her shopping relationship than in months zero to six. Hence a repeat customer is three times more likely to help you generate more revenue than a new customer.
More Economical For Companies
Customer retention is more economical than customer acquisition for most businesses. While you should equally retain both your old and new customers, experts opine that it usually costs five times more to acquire a new customer than to retain an old one. Hence, keep strategizing with your team to retain your old customers to make the business more economical for the company.
Creates Brand Ambassadors
Loyal customers can be valuable assets to your company and indirectly vouch for your brand or product. These customers act as brand ambassadors for your company and help in indirect promotion in several ways. Such customers help promote the brand through recommendations, sharing reviews, and word-of-mouth. And, what’s better marketing for a company than its customers promoting them?
10 Powerful Customer Retention Strategies Your Business Can Try
1. Build Brand Loyalty
Building trust in the mind of the customers comes with a sense of reliability and brand loyalty. This trust can be built over time by consistently delivering on your brand promise, making it easier for the customers to rely on your brand. Consistency and vigilance influence customer brand loyalty and make them return for more purchases therefore strengthening your brand name.
Hence, keep working on customer feedback actively to strengthen their trust and retain them. Research says that 81% of customers believe that trust is important for making a purchase decision. However, this trust is not built overnight! Hence be patient and consistent with delivering your brand promise to make the customers loyal to your brand.
2. Ask Customers For Constructive Feedback
Discuss with your team members and develop a process for taking customer feedback. You will never be able to retain your existing customers if you don’t address and acknowledge their problems. Ask your team to keep track of all the positive and negative feedback, resolve these complaints in no time, and create a process to avoid negative feedback in the future.
You can also ask your customers for their genuine feedback after every purchase. Besides, you can conduct an online survey of customer purchase experience by allowing them to express their concerns (if any) through these forms. Consequently, gather the data, analyze them, and share them with your team so that they can work towards enhancing the customer experience.
For example, keep a process in place to collect product reviews from customers after every purchase. If there is a significant number of negative reviews, share them with your team and decide on making changes to your product accordingly. Implementing customer feedback will improve your product and lead to greater customer retention.
3. Encourage Word-Of-Mouth Support From Customers
Word-of-mouth advertising helps gain new customers and retain the old ones. There are more chances of acquiring new customers with the help of old ones, as they will recommend your brand in their in-person channels.
Start actively encouraging word-of-mouth marketing for better customer retention. Encourage your customers to give feedback and share their thoughts on your product. Acknowledge their efforts and opinions, and, most importantly, make them heard and valued. The more they feel important and valued, the more they will keep sharing and recommending your product on various social media and in-person channels.
4. Invest In Customer Loyalty Programmes
Every business should take the initiative to develop customer loyalty programs to make their loyal customers feel important and valued. These loyalty programs can be of multiple types and should be crafted as per the customer’s choices. Surveys and feedback can be a great way to know what loyalty programs your customers may like.
Think! Why would a shopper purchase from your website when they can get the same product from a mart near them?
To make the customers prefer your website over a mart, entice them with such loyalty programs. Start by sending the customers special invites, asking them to sign-up for the programs, offering rewards, discounts, and free shipping, and letting them enjoy certain special benefits of a new product before making it available to a larger audience. Additionally, you can also give them free gifts and club memberships to make them feel precious.
Besides, leverage social media monitoring for analyzing customer behavior to understand which loyalty program works best for them. Make changes to your program accordingly to keep them engaged with your offers and to keep coming back for more incentives.
5. Engage With Customers On Social Media
Engaging with customers on social media is a powerful way for brands to enhance their customer retention efforts as it is the best place to advertise a business. Social media creates an opportunity for you to build stronger relationships with your customers by providing a platform for customers to interact with your brand.
Customers feel heard and valued when brands regularly engage with them, building trust and loyalty. Using social media automation tools to optimize the engagement process, brands can increase customer service response time and provide more personalized customer experiences. This ultimately leads to higher customer retention rates.
6. Top-Notch Customer Service Support Is A Must
Providing exceptional customer support is important for retaining customers and maintaining effective customer experience management. Brands prioritizing customer service and personalizing their interactions are more likely to build strong, long-lasting relationships with their customers. In fact, research shows that 86% of consumers are willing to pay more for a great customer experience.
To ensure top-notch customer service, firstly, you need to acknowledge customer queries promptly across all customer review platforms and resolve them soon. Secondly, be polite and assign executives who are the best in the process to help customers personally. Finally, offer multiple reach-out channels to increase the communication spectrum and monitor them regularly.
Following these will surely increase customer retention and loyalty in the long run.
7. Brand Personalization Helps Greater Retention
Every customer query is different; hence, you must deal with each query individually, as a general query redressal system won’t be fruitful.
With so many options in the market, your customers will need a strong reason to be loyal to your brand for any purchase. This is where personalization comes in. Research says 76% of customers prefer sticking to brands that offer them more personalized shopping choices. Hence, brands offering personalization have a greater chance of retaining and attracting customers.
Online reputation management is a crucial strategy for retaining and attracting customers through personalized shopping choices. By studying customer purchase behavior and conducting surveys to understand their pain points, brands can offer personalized solutions to retain customers.
Implementing online reputation management as part of your marketing strategy can help track people’s perception of a brand, build brand image, and ensure that customers keep coming back to your brand for more.
8. A Smoother Onboarding Process Builds The First Impression
Customers are more likely to repurchase from brands with whom they had a smooth first purchase experience. Hence, a good onboarding process is absolutely necessary for making your customers repurchase from your brand and increasing sales. The better the onboarding experience, the more your customers will purchase again from your brand.
To make them keep coming back, ensure to avoid communication blockers initially and give them detailed information on the point of contact during any purchase difficulty. After their first purchase, keep in touch with them through emails and follow-ups, providing them with customer support details if need be. This will portray your brand in a positive light and develop a sense of reliability.
Moreover, you can provide a detailed demo video to guide them on product usage. Additionally, you can also add tutorial links and images for better clarity and to entice your customers. Thus, ensuring a smooth onboarding will lead to a great first purchase experience, and your customers will be more likely to start spreading the word about a smooth user experience.
9. Avail The Benefits Of Email Marketing
Email marketing is great for targeting customers and creating personalized messages to build strong relationships with them in the future. Email marketing is much more beneficial than other direct marketing campaigns as it enhances the customer response rate.
Start by dividing your email list into smaller groups based on customers’ interests, behaviors, or demographics. This will allow you to tailor your emails and offers to their specific needs and preferences.
You can give your email list of old customers a reason to stay with your brand for longer by offering them exclusive promotions and discounts, making them feel valued and appreciated, and encouraging them to keep coming back.
This effective customer retention strategy lets you cement your brand presence in the customers’ minds, as they are more likely to come back to avail of these benefits.
10. Utilize Data To Understand Customer Requirements
Leverage the data at your disposal to understand your customer’s requirements and their pain points regarding your brand or product. This will help you understand customer perception of your brand and make changes to the product accordingly.
To gather this data, you can start by collecting and analyzing product reviews and customer feedback. Take the help of sites like Google My Business, Yelp, TripAdvisor, TrustPilot, Consumer Reports, or social media to learn about customer experience, preferences, dissatisfactions, and opinions. Using tools like Sprout or Hootsuite you can manage various social profiles from a single platform. But they can be a little costly, in that case you can look for sprout or hootsuite alternatives that help you manage customer engagement and social publishing effectively. Considering and actively working on customer feedback will improve your product and boost customer retention, as they will feel heard and valued.
Customer relationships take a lot of effort and time to build and yield results. If you want to retain your loyal customers, be patient with the process. Keep focusing on enhancing the customer experience to retain the current ones while also attracting new ones.
Follow the above-mentioned strategies, be consistent and understand the function of each customer retention strategy and start planning accordingly to gain a competitive edge and grow your profits and revenues.
