When you have invested the time and money to acquire a brand-new customer, you lose on the full revenue capacity of that individual if they leave, or churn, earlier than preferred. By minimizing the rate of churn, companies prosper and grow quicker.
When most companies think about how to speed up growth, generally their first thought is to pursue new customers.
While customer acquisition plays a significant part in profit growth, a less readily considered, yet crucial aspect is consumer satisfaction, as realized by high customer retention rates – research has shown there to be a 60-70% likelihood of making a sale to an existing customer, compared to 5 – 20% for those with no previous purchases.
Online reviews and consumer feedback shared on review websites and forums like PissedConsumer.com, BBB and QuoraQuora can have a major role in not only developing a businesses’ reputation, but also in the success of a customer retention scheme.
Customer loyalty schemes and insider benefits
Rewarding customers for their commitment is a fantastic way to incentivize repeat custom – hence it’s among the most effective customer retention strategies.
Businesses can employ a multitude of tactics to achieve this, including:
● Multi-buy offers;
● perks such as seasonal gifts;
● customer rewards;
● value-adding subscriptions.
While these methods are well-established and time-proven, businesses build their most effective client advantages through creative thinking and offering up new, novel incentives, so consider the unique wants and needs of your customer base when devising your customer retention strategies.
After-sales support implies interacting with customers about their purchases after the deal has been done. The best method to deliver after-sales support differs depending upon the type of product and brand name. Commonly utilized methods include:
● Calls through a customer care phone line to guarantee the consumer is having an excellent experience with the product;
● direct mail, including discount vouchers, promotions;
● customer service e-mails teaching the client how to get the most out of the product;
● free delivery and returns.
Some industries offer more thorough after-sales support, through methods such as webinars and training sessions to assist consumers in getting the most out of the product or service. This is specifically common among companies that provide subscription services.
A good way to reveal reasons for churn is customer feedback. A company might be informed by multiple customers that they are unhappy with a certain element of a product that didn’t satisfy their expectations, or it might emerge that there has been a sticking point in the purchasing experience, such as slow delivery or unprofessional customer support.
For this reason, having an effective mechanism for promptly addressing customer concerns and complaints is paramount. If you don’t lend your disgruntled customers an ear, they may very well choose to express themselves through online reviews on a public platform, In fact, 2.4M consumer complaints left just on Pissed Consumer evidence that customers often are neglected by the business.
Personalization and targeting consumers who promise to become repeat customers
Personalization has become an essential marketing concept. It indicates making marketing particular to each customer. It is crucial for a business to synchronize its understanding of its customer base at an individual level. Each customer, although similar, may demand a different approach.
Emails are the go-to for businesses focused on maintaining their current customer base, with 55% of companies employing direct mail strategies, but there are several alternative approaches that can be used in combination also. For example, 63% use social media as a customer retention marketing tool, and 49% make use of online marketing.
The basic personalization strategies are implemented through approaches such as mail merge, which can instantly modify marketing emails so that they utilize the consumer’s name, instead of a generic salutation.
Determine the reasons for consumer churn by looking thoroughly at client behavioral data
If a business has an online store, it might observe that returning consumers typically abandon their cart at a certain point during the sales procedure. It is highly advantageous to identify why this is and consider what can be used as a ‘hook’ to keep the customer on course to completing the purchase.
Some consumers are naturally more inclined than others to purchase repeatedly from a service. This can result from a wide variety of individual aspects, consisting of propensities towards brand name commitment and regular behavior, personal requirements, and how much money the consumer has offered to spend on the sort of products or services the business offers.
More advanced personalization strategies
A business can tailor which products are promoted to a consumer based upon their purchasing history and optimize the marketing communications provided to a client according to their behavior information. These methods improve customer retention by making clever usage of the details a company already has about each consumer.
Companies should beware not to focus too greatly on certain customer groups at the cost of others. With that said, it makes good sense for a service to concentrate its marketing on those who are considered likely to become repeat customers.
Recognize the factors for consumer churn
Churn is the phenomenon of customers purchasing from a business, and after that rapidly exiting the business-customer relationship. This is the opposite of customer retention and is obviously something to be avoided.
Customer retention is as crucial as enticing new customers, yet it is typically overlooked by small organizations. Understanding the reasons behind customer churn isn’t complex, but trying to identify them can be laborious.
It simply comes down to investing some time and effort into identifying the wants and needs of your customers, doing what you can to ensure they are satisfied with your product and service, and keeping them interested in your future offerings.