Improve Customer Loyalty – 12 Customer Retention Strategies You Should Try
Customers are the most important part of any business. Without them, there would be no business! This drives a lot of businesses to focus so much on winning new customers. There is nothing wrong in a business trying to win new customers, the problem is that businesses often lose sight of the existing customers in the process.
So much effort and resources are invested in getting new customers, with little being done to nurture the existing customer base. Various studies and research have revealed that it is more profitable for businesses to worry about ensuring the existing customer base stays loyal. To buttress this point, consider these statistics:
Acquiring a new customer can cost five times more than retaining an existing customer
Increasing customer retention by 5% increases profits 25-95%
– Bain & CompanyThe success rate of selling to a customer you already have is 60-70%, while the success rate of selling to a new customer is 5-20%
– Marketing Metrics
Having a high customer acquisition rate and a low retention rate is like filling a bucket with holes in the bottom — If you don’t figure out a way to patch the holes, you will always lose customers to competition.
Hopefully, you understand the importance of retaining customers and you’re now wondering how you can improve customer loyalty or what customer retention strategies you can apply to your business.
12 Awesome Customer Retention Strategies For Your Business
Here are 12 powerful customer retention strategies you can apply to your business to improve customer loyalty and increase retention rates.
#1. Set Clear Expectations
Some businesses aggressively “hype” their products and services with exaggerated capabilities to draw in prospects. While this strategy might work in the short term, such businesses will eventually be unable to meet the unrealistic expectations customers have, and this would lead to disappointment and distrust in the brand.
Setting clear customer expectations will help your business win the customers’ trust as you will be able to consistently meet and even exceed these expectations. As a result, the business enjoys a long relationship with customers, some of whom will become your advocates. (Check out these tips for setting realistic customer expectations)
#2. Make Business Convenient for Customers
Making it easy for customers to use your products and services will give you a massive edge over your competition. Can you make it easier for customers to buy your products? Can the products get to them faster? Is your product manual simplified and easy to understand? There are a lot of ways to make things convenient for your customers.
Perhaps you could give customers the ability to order products online, or even get the products within two days of placing their order. If customers find doing business with you convenient and the rest of their experience is positive, they will flock to patronize you and continue to return.
Take time to identify areas where customers might be experiencing friction and come up with solutions that eliminate or reduce the friction. Does your business need to close by 5 pm or 8 pm? Would having a mobile app make things more convenient for your customers?
3 Ways To Make Things More Convenient for Customers
- Offer In-Store Pickup Option For Online Shoppers
Just because you sell your products online, it doesn’t necessarily mean that you’re obligated to ship them directly to their buyers
- Open Up Communication Channels
Offer customers different communication channels through which they can reach you. There is no commandment stating customers must reach you via telephone or email. Social media and Instant Messaging apps like Whatsapp for business are very viable communication mediums
- Offer Free Shipping
If your business can offer free shipping it would not only help boost your online sales, it would make things even more convenient for customers as they get what they ordered directly at their doorstep without any extra charges.
#3. Personalization
Personalization is more than just welcoming back a returning customer, or using their first or last name in addressing them. The goal of personalization is to create a compelling experience that leaves a positive impression and encourages the customer to come back again.
Personalization can be achieved through various mediums; email, social media, in-person, call center or even your website. A good place to start is by creating personas for your customers, this gives you better insights on what their interests are, and empowers you to make recommendations or create content relevant to the customers.
#4. Customer Education
Your business can reap immense benefits from educating customers. If it fails to do so, the customers will make effort to find the information themselves anyway, but you lose valuable points you could have scored with the customers, or worse – lose them to a competitor that empowers and teaches them how they can get the most out of the product.
When your customers know and understand a product, it’s features, capabilities & limitations, it gives them realistic expectations on what they can achieve with the product. This deep understanding of your product or service is very important for building trust. Without this trust, loyalty will not be possible.
#5. Keep Your Customers’ Engaged
Your customers will value helpful recommendations on new products or services that will help them achieve better results. Take advantage of this and improve customer loyalty by creating content that not only helps the customers but keeps them engaged.
If you abandon your customers after they buy your products, or only communicate with them when you’re trying to market or cross-sell a product, you are doing it wrong. Providing your customers with quality relevant content will make them see your business as a go-to resource when they need information or help on products or services on offer.
This increases their trust for your brand which increases customer loyalty ensures they continue to patronize your business.
#6. Be Present on The Right Platforms
It is important that your business meets customers where they are. To do this, the first step is to identify who your audience is, and you have to be as specific as possible.
- Who is your typical customer?
- What’s their gender?
- How old are they?
- What’s their education and income level?
- What are their interests?
Without knowing the answers to questions like these, it will be difficult for your business to create an effective strategy to engage and retain these customers.
When you have created personas for your customers, the next step is to determine what platforms your customers use by looking at the demographics (age, gender, location etc). Check out this persona creation tool by Xtensio
You should also consider how active customers are on these platforms. For instance, if a majority of your customers are between 18 – 30 years of age, they are very likely to be on Facebook and active Instagram.
This means your business should be present and visible on both platforms, engaging and providing support for customers if they decide to reach out to the business on these platforms.
#7. Create a Community For Customers
Consider creating a discussion board or forum on your website. It will give your customers the opportunity to discuss important topics and ask questions about your products and services, and interact with other customers as well.
An online community can quickly become an innovation hub and a source of customer feedback as challenges, questions, and new ideas are raised. With both customers and your support actively involved, your business will be able to provide solutions to customer issues and ideas.
You can make things a little more fun by giving perks such as a status badge, discounts or branded merchandise to the most active members of your community. This would encourage more active participation and in turn build your customer’s confidence to trust in your brand.
#8. Use Positive Reviews & Testimonials
About 92% of customers will regularly or occasionally read customers’ reviews first before they make a purchase. Use customer testimonials and review to attract new customers and also convince existing customers to upgrade their products or try a different one.
Showcase loyal customers and their stories on your website or on social media. These testimonials don’t have to be 100% positive, but they must be real (from actual customers).
Making use of customer reviews and testimonials will help you build trust with your customers as they read reviews from other customers who have used your product or service. Such unbiased reviews also help set customer expectation as they read about your product’s capabilities and limitations.
#9. Reward Advocates
A study from the Wharton School of Business states that referred customers are between 16% and 24% more loyal on average. Most customers will simply use your products or services to meet their needs and goals. A few will go out of their way to share their positive experiences with your product on their blogs or social media.
If you spot a customer making such recommendations for your business be sure to appreciate them. Consider that each new referral from ab advocate represents one customer that you didn’t need to spend a dime to acquire. Even better, you can implement a referral program to reward and appreciate customers who refer new customers to your business.
Rewarding your advocates doesn’t have to be expensive, you can offer a nice discount, free products, gift cards, free shipping on next order or even raw cash. Rewarding your advocates shows you pay attention and that their referrals mean something to you.
#10. VIP Treatment
Make your loyal customers feel very important to your business. You can do this by offering such customers exclusive access to things no other customers have access to.
This can be as simple as giving them a sneak preview of your latest product, using them as beta testers, access to company events or giving them the chance to order such products first before anyone else. If you make these customers feel valued, they will not only stick around, they’ll advocate even more for business.
#11. Customer Appreciation
People will feel taken for granted when they are not appreciated for things that they do. Customers feel the same way when a business fails to show appreciation for their constant patronage.
The easiest way to make a customer feel valued and part of a two-way relationship is to continually thank them for their business and loyalty. You will be glad you did, you may even create a couple brand advocates
– Alex McEachern
The more your customers feel good about their experience with your business they are more likely they are to come back and make referrals.
Read: Why You Should Thank Your Customers Always
#12. Get Customer Feedback
Customer feedback can help your businesses identify any problems with employees, products or processes, making it possible to fix such issues. Feedback can also be the source of the next innovation that gives you an edge over your competition.
Don’t look at complaints as a burden or pain, they’re a great source of raw feedback. The complaining customer is a good source of valuable unbiased feedback, his complaints point out areas where you need to make improvements. Customer surveys are another great tool to determine how customers feel about a brand & its products or services.
Read: 7 Important Tips For Creating Awesome Customer Surveys
It is not enough to get feedback, what do you actually do with them? Act on the feedback & give the customer updates when it is done. This proves to the customer that taking the time to share the feedback with you was worthwhile. Working on the feedback leads to changes which will improve customer satisfaction, trust and loyalty.
Bonus
These customer retention strategies when implemented will yield positive results for businesses of any size from huge multinationals to small startups.
If you would like to learn about more loyalty strategies that work and how you can apply them in your business, check out this online course on
How to Build Customer Loyalty
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