For many companies, growth is about attracting new customers. All kinds of tools are being developed for this. However, what is the long-term benefit of a one-time sale? For constant growth, companies do not need to attract new ones, but to retain regular customers. We will show you how to do this.
What is customer retention and why is it important?
This term refers to a set of measures aimed at educating and involving customers. The main goal of those is to retain the user for a certain period. The longer it is, the better. This means not only the presence of the client but also the stimulation of purchases of the company’s products and services.
Retention is a necessary strategy. It provides a host of benefits and business opportunities. Including:
- Less marketing. By interacting with a customer, you are not developing, but improving communication. For example, often reminding yourself. Retargeting, A / B tests, and personalized email newsletters require significantly less time and money.
- Better conversion. First, the person who bought the product already has some level of trust in the business. Second, the company owns information about human user behavior. This allows you to create more effective and personalized messages, as well as predict customer actions.
- More profit. When buying for the first time, price is one of the key decision factors. However, existing customers are more loyal. The interest of such a person in a new product line, for example, will be much higher. Cross-selling and up-selling work well with existing customers.
- Reviews as an opportunity to improve. Just by reading them, you will see weaknesses in customer interactions. Accordingly, you can eliminate it. Find out if the product/service met expectations? Does the price match the quality? Did the customer like the service and why? All of these are colossal growth opportunities that loyal users provide.
- Reduced costs. Customer retention is cheaper than customer acquisition. The latter will cost 5-25 times more. In contrast, even small retention efforts (5%) can significantly increase profits (by 75%).
How to get a customer back with a retention strategy?
Set realistic expectations
When making a purchase, a customer has certain expectations. They relate to quality, service, delivery, and more. Negative experience is a consequence of the unjustified expectations of the user.
Therefore, it is necessary to devote time to this. Setting realistic expectations is perhaps the key secret to retention. Think about the quality you can guarantee. Perhaps I would like to deliver in a day. However, due to the location of the company, the number of orders, or other factors, they are actually capable of delivering in three days. Set the term by anticipation.
Are you worried that the company’s real capabilities will scare customers away? There is always an opportunity to develop another scenario that will help keep. Using the example of the same delivery, you can notify about order packing, shipment, and transportation status.
Identify signs of leaving
Notice the client’s fading signals, take action and the person stays with you. Analyze customer behavior. If you look closely at the process, you will notice certain signals that appear before the client leaves.
To determine them, it is useful to know the purchasing behavior of users. Define its variables. For example, the way or duration of product use, purchasing patterns, and more.
Also, pay attention to support calls. It is not difficult to obtain this information. The CRM system will help with this. Once you’ve identified the customer exit signals, develop measures to help prevent customer loss.
For example, one of the signals is the absence of purchases for a long period. These customers can be sent an email reminding about the company, products, or providing a discount.
Keep in mind, however, that your messages sent to customers should not contain mistakes. The presence of typos can severely damage the company’s image. In order to avoid such situations, use marking services, Grammarly, ProWritingAid, etc. This will help to improve the quality of content, and hence the level of trust in the business.
How can you find them? Download information about all purchases from the site. On a separate list, add people who have not made an order in the last 6 months. Now you can work with these clients. For example, by sending an email or asking about the reason for the refusal.
Comments full of indignation are not the most pleasant reading. However, such reviews speak of things that reduce customer satisfaction. And it determines whether customers stay with you.
Therefore, approach negative reviews constructively. Each comment speaks about the area in which the company should develop. When you receive a complaint, try to respond to it as quickly as possible. If you can remedy the situation (for example, by replacing the product), then do so. This will eliminate the negative customer experience. In each review, try to highlight key points, draw conclusions, and improve the corresponding stage of the service.
Automation software often runs on machine learning or artificial intelligence. Therefore, it does everything faster and more accurately than a person. Tasks are performed independently. You don’t need to waste time on this. Also, automation tools make service and communication with customers timely, operational, and personalized.
What can you do to retain customers with automation?
- Personalized newsletter.
- Creation of relevant and interesting content.
- Informing about the status of the order.
- Personalized recommendations for every customer.
- Fast service.
Customer retention is a strategy every company should use. It takes time and good user understanding. However, by increasing your customer retention rate by even 5%, you will increase your profit from 25% to 95%. And to make it possible, there are the above recommendations.