Any customer that you inspire to buy from your business should be a significant growth opportunity, not just one purchase. By successfully retaining your customers, you can ensure the time and money you spent trying to make them come to you in the first place is well invested. Even though it’s important to bring in new customers, it can be just as important (or even more so) to keep your current ones happy.
Smart businesses understand the importance of keeping their current customers buying from them, rather than spending with a competitor. Unfortunately, not all businesses see this and can sometimes lose sight as they focus their efforts on generating new customer leads. But, creating new customer interest can mean a significant marketing cost. You would need to attract your customers into buying and then actually get them to part with their cash. In comparison, retaining an old customer can cost up to 30 times less than getting a new one. After you’ve gone through that process, wouldn’t it be wise to ensure that investment gains the most capital possible and take care of those customers and their every need?
Why is retaining customers important
Besides making financial sense, retaining customers can also increase the amount your customers spend with you. Research conducted by Yotpo, a user generated marketing solution, shows that a customer who’s previously bought from you will spend 2.92 more times the amount a one-time shopper will. This is because loyal customers will start to trust the brand after repeatedly purchasing, and feel more confident spending larger amounts of money as they’ve already seen positive results.
Not only will customers spend more if they’re a returning customer, steady customers are more likely to spread the good word about a company they like. Their family, friends, and work colleagues will be exposed to the brand, even if it’s as simple as their delivery arriving at their workplace with obvious branding on the packaging. Therefore, it’s important to remember that any customer-facing employee is representing your business; they represent the company every time they interact with someone, whether that be a customer or client.
Collect and act on NPS-powered customer feedback in real time to deliver amazing customer experiences at every brand touchpoint. By closing the customer feedback loop with NPS, you will grow revenue, retain more customers, and evolve your business in the process. Try it free.
Adobe Stock / ikonoklast_hh
Of course, you can’t rely on every customer coming back to make another purchase. The time of year, the customer’s demographic, and the product itself, are all factors that will affect whether a customer is likely to spend with you again. But if you want to make them consider spending with you again, you need to treat them right.
How to retain customers successfully
“How do I get my customers coming back,” you ask? There are many methods of keeping consumers loyal to your brand, some of which will only work for specific sectors. We’ve put together our favourite methods that can work for all, no matter how big or small your business is:
– Respond to every interaction
With so many channels of communication available to businesses these days, ensuring you cover them all is vital. Responding to any customer engagement is a great way to show customers you care about their input. Even if it’s as simple as the customer commenting on a post of an offer you’re hosting for the next month, you need to be on that. If you give them the chance to become attracted to a competitor’s post, you may have lost their interest.
– Respond fast
Fast response rates are common amongst most businesses, with many of the businesses on Facebook now advertising if they respond in under one hour, two hours, etc. Because of this, customers can become annoyed if they don’t get a response.
Fast responses aren’t just for social; all channels need appropriate response times to ensure your customers aren’t expecting more than they will get. Set estimates for your business on each channel and make them clear; someone emailing won’t expect a reply as quick as they would on webchat.
Adobe Stock / Karen Roach
– Treating high-performing customers
It’s not uncommon for businesses to treat customers who spend frequently and spend lots! ASOS have their own A-List that allows you to build up your points (£1 = 5 points) in exchange for money-off vouchers. The more points you have, the higher level of A-List you are and the more treats you have open to you (think free next day delivery, early access to sales and further discounts). You don’t have to be a giant in the clothes industry to implement something like this. Work out who your highest paying customers are and add them to a mailing list. Alert them to special offers they have open to them, very clearly mentioning you appreciate the loyalty they have for your business.
It doesn’t end there either! You can introduce customers who may not be at the high-flying level you’re looking for, and offer them a selected range of discounts. Explain how they can gain access to all the special offers and you’ll see the sales roll in. After the ‘club’ has been live for a while, advertise its presence so other customers can aim to be in it. Remember, the aim is to keep this exclusive and treat those who are incredibly dedicated to your brand (we all know that person in our office who orders from a store at least once every week…)
– Show strong employee loyalty
Your employees are usually the face (or name) that your customers interact with most, so if they’re not happy, it can affect the service you’re providing. If companies are good to their employees (giving them the tools they need to do the job well and treating them with respect), that will come across in their work and they’ll be happy to go the extra mile for consumers. A study by HealthStream Research has shown that companies who show appreciation for their staff see three times more return on equity and assets than businesses who don’t. So why wouldn’t you invest that time into making both your staff and customers happy?
– Involve the customer
If a customer is invested in a business, they care about it. Ask for feedback on your business (whether it be on the website, customer service, product, etc.) so you can learn honestly what’s working and what’s not. Send out questionnaires about products once they’ve purchased them so you can get specific responses for different ranges, and even add it to your website to advise others! If you’re piloting a product, invite your most valued customers to trial and test it. They’re your target audience, you should be asking them for advice, no matter how brutal.
It’s important to keep bringing new customers in but it’s equally important to keep your current customers interested and buying from you. Don’t waste the money invested in getting them to the checkout in the first place when they could be spending lots more than new customers on their initial purchase.