For most businesses, your most valuable (and least expensive) customer is the one you already have. Your existing customers have been through the sales cycle, understand your offering and require less to convert, both financially and from your team. Customer retention is an important piece to creating a profitable business.
Here are seven low-cost tactics that you can implement to help keep your existing customers on board longer.
1. Monitor your customer retention rates.
You can help improve customer retention by understanding the numbers. This means figuring out how many of your customers are new versus returning and tracking their progress for an extended period of time.
One way to do this is by implementing a customer relationship management (CRM) system. A CRM system is a tool that captures customer data as they interact with your company. You can track who your customers are, how frequently they purchase from you and the marketing channels that brought them in. Having this data can help you serve your customers better by identifying opportunities to respond to their needs faster.
There are a variety of CRM systems in the market that can match your company's needs and budget.
2. Look for trends and adjust your marketing strategy accordingly.
Once you understand who your customers are, you can start to look for trends. One way to do this is by evaluating segments of your customer base that have commonalities. For example, if you find a particular demographic making more purchases than others, see if they represent a new persona to explore. You can then share the data with your marketing team so they can create targeted campaigns for the newly identified group.
If while evaluating customer segments you find that a group who all came from a particular campaign (or marketing channel) have low retention rates, it may be an indicator that those marketing efforts are not working. You can then share this information with your team so they can make adjustments.
3. Offer a great customer experience.
Customers decide not to return to a business for a number of reasons, but a negative experience is one of the more common ones.
To help repair a bad customer experience, first ensure your customer support team is trained and empowered to resolve customer concerns quickly. Make sure they have access to an updated knowledge base, products/services training and the latest details on new releases.
Second, consider adding support reviews to your customer service process. During these reviews, you can have a member of your team analyze customer feedback (surveys, support tickets, calls, etc.) and report issues to the cross-functional leadership team. This review can happen as frequently as needed, but I recommend having one at least quarterly.
Once an issue is resolved, you can reach back out to the customer(s) who reported it and let them know. This reminds them that you're there and that you care.
4. Give your customers a personalized experience.
According to a 2016 study by Accenture, where more than 1,500 consumers between the ages of 18 and 60 across the United States and United Kingdom were surveyed about their online shopping behavior and preferences, customers prefer companies that offer them a personalized experience.
For example, 56 percent of surveyed consumers were more likely to shop at a retailer in-store or online that recognizes them by name, and 65 percent of respondents were more likely to shop at a retailer in-store or online that knows their purchase history.
In this day and age, personalization not only matters—it is expected. And businesses may want to include some form of personalization in their marketing and operational efforts to keep up.
Consider adding automated communications based on your CRM data (such as birthdays) to send out notifications—for example, a birthday discount code. You can also send targeted emails based on where the customer is in the purchasing process.
5. Provide value to your customers.
One of the reasons why customers return is because they find value in your offering. Think about what you're selling. Does your offering provide value? Does it work properly? Does it meet your marketing promises? Is it a competitor in its space?
If the answer to any of these questions is no, then it may be time to reevaluate what you're selling and make adjustments that may help increase demand. If the answer to these questions is yes, then consider reevaluating your marketing materials, and making sure you're communicating your product's value proposition appropriately.
6. Invite them back.
Immediately after a customer makes a purchase, consider inviting them back. It can be as simple as saying: “Thanks for coming. We're looking forward to seeing you back next week." Or you can give them a specific reason to return, such as the dates for an upcoming sale, a discount off their next purchase or a personal invite to an event.
7. Stay in touch.
Some customers may be interested in returning, but have forgotten about you or lost touch. Staying top of mind means keeping in touch. Consider sending out a regular newsletter, blogging about topics that interest them and keeping your social media channels up to date. This can help remind your customers about you when they're ready to buy.
Read more articles on customer relations.