Working on customer retention is very important when it comes to growing a sustainable business. Research has shown that increasing customer retention rates by only 5% can increase a company’s profits by up to 95%. In addition, retaining existing customers costs much less than acquiring new ones, and both are valuable when it comes to your bottom line.
So before you start focusing on tactics that will help you attract new prospects, consider using the following 6 customer retention strategies that will help you keep your existing customers engaged, happy, and inspire loyalty.
Image source: Forbes
1. Provide Excellent Customer Support
Every business has different customers with different needs. Some of them have basic problems, whereas others have very complex issues that cannot be solved with one response.
For these customers, you need to ensure that some kind of task management tool is built into your customer support system. When it comes to customer satisfaction and retention, getting issues resolved in a timely manner is vital. And for that reason, there is no time to bounce between your support software and a separate task management tool.
Incorporating an employee task manager into your customer support software will streamline collaboration and provide responses to customers much faster. Agents will not be in conflict by working on the same ticket or the same area of a ticket and they can keep departments informed when help is needed with a specific task. Moreover, full task visibility will make it easier for leadership to track ticket progress and follow up as needed.
2. Use a Failed Payment Recovery Service
Did you know that half of all churn is caused by failed payments? Even worse, over 85% of clients don’t respond to automatic dunning emails.
Payments can fail for a variety of reasons including inaccurate information, spending limit on the customer’s card, or insufficient funds on the card. And while eliminating failed payments altogether isn’t possible, the good news is there are ways to minimize it.
There are numerous strategies and tools you can use, and one of the most effective ones is working with a specialized failed payment recovery agency. A specialized failed payment recovery agency will assist you in recovering payments that would otherwise be lost and provide detailed reporting, helping you save the invaluable customer relationship and grow your revenue.
3. Create a Customer Loyalty Program
New businesses and startups being launched on a daily basis—all of them fighting for the audience’s attention and a share from the market pie. Having something distinct about your company can help you rise above your competitors and that’s where loyalty programs come into play.
A loyalty program rewards customers for their loyalty. The more they buy from you and interact with you, the more they are rewarded. This keeps shoppers happy because they are getting more from than just your products or services. And considering the fact that the top ten percent of your customer base spends 3x more than the rest of your customers, you will want to ensure that these users are satisfied.
By offering rewards to loyal customers, you are showing appreciation and this appreciation will return to you when these customers become brand advocates.
4. Take Advantage of Personalization
Your brand’s overall success depends on your ability to offer a personalized journey for every customer. Research has shown that nearly 80% of consumers are willing to share information about themselves in exchange for personalized interactions in which they feel valued and known.
One way to achieve this is by getting shoppers to create an account. This is an excellent way to find out more about them and provide a more personalized experience. Another simple but effective way to add some personalization is by offering product recommendations based on past purchases and customer behavior.
5. Use Email
Research has shown that one of the most common reasons why companies lose customers is the lack of communication and not investing enough in building relationships. In other words, businesses aren’t doing enough to stay in touch with their clients and that results in declined customer retention rates.
Email is an easy and cost-effective channel that can help you improve your customer retention strategies. In fact, more than 55% of marketers consider email marketing to be the most effective channel in generating revenue. That’s because email is easy to personalize and even easier to track.
Use email to stay in touch with your customers, send personalized messages to specific groups of customers, send friendly reminders, create personal one-to-one relationships with customers, send special promotions and customer feedback surveys, etc.
Image source: Crazy Egg
6. Offer Easy Returns and Fast Delivery
If you sell physical products, one of the most effective retention strategies you can incorporate is fast shipping and hassle-free returns. In fact, studies have found that companies that make the return process easy appeal to 80% of consumers. Customers expect online retailers to offer easy returns, exchanges, and refunds for items that are damaged, defective, or different than expected. Retailers that don’t have a liberal return policy risk losing customers to competitors who offer free returns and a 100% money-back guarantee.
By combining fast, free shipping with easy returns, you set yourself apart from the competitors, give your customers peace of mind, and encourage them to do business with you again.
Your existing customers are the best asset your business has. They are already familiar with your brand, know your products, and appreciate your service.
Focusing on improving the experience for them instead of constantly trying to come up with ways to attract new customers can help you speed up the growth of your business and boost your revenues.