Customer retention is a key part of any business, as it leads to the growth and sustainability of the company. You need to understand your customers’ needs and determine how to provide them with the best experience possible.
Companies often focus on customer acquisition and neglect the importance of retaining them. If you want to grow your company, you need to retain your customers. Why? Simply put, it’s more expensive to acquire a new customer than it is to retain an existing one.
According to Harvard Business Review, onboarding a new customer is 5 to 25 times more expensive than retaining current. You can grow profit from 25 to 95 percent by just increasing retention rates by 5%.
What is customer retention?
Customer retention is retaining customers and reducing the churn rate or lost customers. Churn occurs when a customer leaves a service provider. They may leave for many reasons, such as dissatisfaction with the product/service, switching to a competitor’s product/service, or personal circumstances. The degree to which a company can retain its customers is called customer retention rate.
You need to maintain the retention rate because it means you are getting repeated business, and as a result, your financial situation will improve. It is a crucial aspect of business strategy and can help you gain a competitive advantage. It is an important metric for any business to consider, not just retail outlets.
Customer retention aims to maintain your current customer base and increase loyalty by improving service. You can employ various methods to keep them for longer, including loyalty programs, discounts, freebies, special offers and targeted marketing campaigns.
Customer retention techniques
Gift vouchers and discounts
The importance of customer loyalty is becoming more and more significant in today’s world, with customers demanding better service and experience. As a company, if you aren’t incentivizing them to stay loyal to you, your revenue will decrease.
As a company, it’s important to make sure that your customers are satisfied and happy. One way to do this is by rewarding them for their loyalty with various discounts or gift vouchers. Giving out these rewards will make them feel appreciated and valued, which will increase the likelihood of them coming back again.
Customers respond favorably to incentives like vouchers and discounts, but what you offer them should align with your brand values. So don’t offer it just because you think you will lose them otherwise.
Excellent customer service
A key factor in customer retention is ensuring that they are satisfied with how you provide them with service. A good way to do this is by providing quick responses and being attentive to their needs.
You can also use social media as a means of interacting with them and getting information about their opinions on your products and services. This will provide you with more opportunities to improve retention rate by catering more toward what they want or need from you.
Excellent customer service can improve your public image and fix any problem before it gets critical and increase your customer retention rates.
Smooth onboarding process
The best customer onboarding process is the one that captures the attention of your customers and makes them want to come back and stick around. A well-designed onboarding process will help you anticipate their needs and make it easier for them to find what they’re looking for.
The first impression is important, so you should ensure it is flawless. You can use methods like emails or tutorials, but the best way is usually live chat which allows the customers to ask questions without any delay and is more personalized.
It takes a lot of time and understanding on the company’s part for customer onboarding to be successful. It would be best to have a dedicated team that can work on onboarding and is available for any questions or problems during the process.
Keeping customers in the loop.
By keeping them in the loop, you can increase the retention rates. Customers want to know what is going on with their orders, and they appreciate it when companies keep them updated with the process.
It’s important to be transparent about your business dealings, whether related to prices, policies or other matters. Keep them informed, and they will be more likely to stick around.
There are many ways you can try to keep them in the loop, like sending out monthly newsletters, emails with deals, discounts, and special offers. Hence, updating your customers about any changes you make will keep them loyal and happy and show them how much you care about them.
Automated customer engagement
Automated customer engagement is the use of technology to optimize customers’ experiences. It is a cost-effective way of providing great service and can also help you maintain high retention rates.
The first type of automation is self-service technologies that help customers perform tasks for themselves. This reduces the need for customer service representatives, who are often at odds with customer satisfaction.
The second type of automation is using a software that simplifies interactions between you and them through artificial intelligence. For instance, you can automate your customer feedback process, emails, text messages, etc. and trigger an automated response to them.
It is always beneficial to keep your customers happy. The more satisfied they are, the more likely they will continue their patronage with your company. Moreover, buyers who stick around tend to be happy, becoming a hub of referrals. Hence, it could be beneficial if you adopt ways to increase your customer retention rate.
In order to automate your customer engagement process you can use a call automation platform like FreJun and make the process hassle-free. You can try FreJun for free for 7 days and see if it’s the right fit for your business.