Top Customer Retention Strategies to Grow Your Business
Announcing our conversational customer experience platform.
Announcing our conversational cx platform.
Get the scoop
Announcing our conversational customer experience platform.
Announcing our conversational cx platform.
Get the scoopDoes your business focus more on lead generation or retention? The most common answer is lead generation; the right answer is retention.
But What is Customer Retention?
Customer retention is a process aimed at increasing the lifetime value of a customer and thereby turning them into a company's evangelist.
Retaining customers should be a top priority for your company, no matter what the industry. Think of it this way: is a farmer’s success measured by the number of seeds they plant, or by the weight of their final harvest? Collecting leads can be thought of as planting seeds. Customer service as the tending and watering, and retention as collecting an abundant reward come the end of growing season.
With an average of 68 percent of sales coming from an existing customer base, businesses should focus on keeping their current clients near and dear. But how? Customer service is the best place to start—89 percent of customers say that a company providing poor customer service damages their impression of the brand. And with so many social media channels available—allowing people to express their opinions to a wide audience—you don’t want any damaged impressions floating around unanswered.
To keep the math simple, let’s say Company A has a yearly revenue of $100,000. Every product they sell costs $1. With their existing customers making up 68 percent of their sales, we can see that $68,000 of their annual revenue is thanks to retention.
But if they lose focus on retention and experience a 20 percent cut in their client base, they stand to miss out on nearly $14,000 in expected sales. Put simply, good customer service leads to retention. Retention leads to higher sales. Higher sales lead to growth. It’s the ideal business growth cycle.
Are you facing a high churn rate? Check out these 11 proven strategies (validated by experts) to reduce customer churn rate. Learn More.
If you’re ready to make customer retention a pillar of your marketing and growth strategy, zeroing in on the customer experience is the first step. Several factors go into creating great customer service.
Before turning your focus to customer retention, take some time to go through each factor of the customer service experience using data or focus groups, along with any customer feedback available. Be honest with your criticism. Where can you improve? What goals can you set to create a better customer experience? What matters most will vary from customer to customer, but when you’re truly committed to delivering an exceptional experience and meeting customer needs, it shows.
Consider the following suggestions when developing a strategy to deal with all the different customer interactions with your brand
So many businesses abandon new customers before they’ve even put down their pens after signing a contract. That might be a slight exaggeration; but if you're aiming to impress new customers, develop an intimate onboarding process.
It’s important that you engage new customers right from the start and the best way to do it is through a robust onboarding program. This is your chance to train them on how to make the most of your product and maximize return on investment, turning them into satisfied customers.
Example: Create an automated email series that introduces new customers to your brand, provides instructions, and opens the door for communication. You can also explore live chat, as well as video and voice chat solutions to improve new customer support.
Out of all the factors that influence customer experience in today’s market, personalization is easily one of the most important. If you’re overly focused on uniformity and perfection during customer interactions with your team (i.e rote and mandatory scripts such as the classic “do you want fries with that?” at fast food restaurants), you’re likely to create the kind of cold and uncomfortable environment that breeds unhappy customers. Instead, treat every customer as the unique individual that they are, catering their experience based on their history, concerns, and preferences.
Example: The basics of personalization should always be there in your business, like personalized greetings. Take personalization up a notch by learning as much as you can about your loyal customers and recording the data you acquire in CRM software. Then analyze your findings to create personal and unique marketing campaigns that are far less likely to be seen as spam.
As a customer, there’s nothing worse than hearing the following sentence.
We’ll get back to you.
Putting off resolving issues is damaging to your customer experience, as 72 percent of consumers find it frustrating when they have to explain their situation to multiple customer care staff. Empower employees to handle and resolve any issues as they come up. Keep in mind that every situation is unique and having a one-size-fits-all approach to finding resolutions will create impersonal experiences devoid of empathy.
A training program can help equip your customer service team with the resolution options they need. Giving them the power to decide on the fly how to use them will result in confident employees and satisfied customers.
Example: If you run a coffee shop, allow baristas to hand out complimentary drink cards to customers experiencing long waits. If you deliver a service, provide your call center employees with a small list of resolution options to choose from when handling complaints, such as a discount for future services, additional services for free, or full or partial refunds.
A lot of companies only focus on the front line when trying to develop their customer service retention strategy. Instead of training only those who see or speak to customers, get everyone on board. This includes stockers, product developers, and anyone else who’s typically behind the scenes.
Example: Warehouse workers rarely see or speak to customers. If you’ve been receiving complaints about damaged boxes, make sure the information reaches the warehouse. If everyone works together to exceed customer expectations, you’re more likely to achieve higher levels of customer satisfaction and retention.
The power of automation opens up a whole world of possibilities when it comes to re-engaging customers. The savings on time and resources makes it possible to reach out to huge numbers simultaneously, while at the same time keeping things relevant and personalized based on preferences and website browsing behavior. This ensures you stay front of mind with your customers while providing them with information they want.
Example: Customers are often willingly provide their email address and agree to receive newsletters. Use this opportunity to re-engage them, personalizing the newsletter content based on the data you have about them. Include tailored relevant offers as well if possible. The optimum frequency of these newsletters may vary depending on the industry you operate in.
If you want to really get on top of your customer retention strategy then you need to make sure that you’re measuring the right things. Using the relevant KPIs gives you the understanding you need to see whether the strategies you implement have the desired impact. KPI performance also helps highlight areas that might need addressing or optimizing.
Example: A company that believes its customers are satisfied, but they need hard data to back this up. That relies on tracking relevant KPI metrics. Putting out a NPS survey to its customers helps shine a light on the true situation. It may show that, in fact, there are fewer promoters and therefore customer satisfaction is lower than the company believed. Addressing these customer concerns then helps to mitigate the danger of churn on the horizon.
The modern customer is a busy sort. They don’t have time to wait around on the phone, queuing to try and get through to one of the few operators on duty and have their inquiry dealt with. They want answers and they want them right away. Self-service customer service tech empowers your visitors to get the answers they need whenever they need them.
Example: A customer comes to your website to try and get in touch and resolve an issue they are having with your product. The issue itself is quite common and easily solved with access to the right information. Instead of waiting around to speak to an agent they can go to your well-signposted knowledge base where they are able to find exactly the right article to immediately resolve their issue.
Customers really appreciate it when you help them solve their problems. One of the best ways to do this is through producing high-quality content that adds tangible value. A content strategy based on a thorough understanding of your customer personas is a fundamental part of a good customer retention strategy as it positions you as an authentic voice for useful information.
Example: Customers may be looking for information on how they can grow their own business. A well-written blog can keep them in the know with the latest strategies providing a host of useful tips and tricks to help them succeed. This builds repeat visits as they look for more relevant content and as the customer comes to trust you, customer retention then follows.
There is no better way of showing customers that you value their business than by rewarding them for it. Customer care and customer retention go hand in hand. It’s also a win-win as while it provides the opportunity to customers to take advantage of special offers it also provides you with the chance to cross- and up-sell different products and services.
Example: Customers who have been loyal to your company for a long time may feel neglected if you don't show any appreciation. An email, or even better a call, on the anniversary of their subscription with you and an offer to upgrade to a better package based on their previous usage habits at a discounted rate shows you really care.
Great customer service strategies take time to implement. Just like the aforementioned farmer, you must wait a while to harvest your reward: in this case, a growing, successful business.
However, higher retention rates (and boosted profits) will soon follow as you find the best ways to improve customer service in your industry.
For more information, take a look at our collection of whitepapers, ebooks, and factsheets.
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