What's better than acquiring one new customer?
It sounds like a trick question, but the answer isn't "acquiring two customers." It's actually retaining an existing customer.
While there's a certain allure that comes with capturing new customers, keeping customers coming back will continually result in a greater ROI — and it costs 5-25X less.
But how do you create a customer retention strategy that keeps your current customers engaged and happy?
We've broken down some of the most applicable customer retention strategies that the biggest brands are currently using to inspire loyalty. From leveraging convenience to prioritizing personalization, we’ll cover all the must-haves that any customer success or marketing team can test out today.
1. Track and analyze churn metrics.
You can't fix what you don't understand. Companies should be diligently tracking and analyzing the number of customers who churn, alongside the reasons that they may decide to churn.
To help you with that, we created a Customer Churn Analysis Template. Use this template to store and analyze qualitative and quantitative feedback to better understand and reduce your churn rate – and increase retention.
2. Implement a customer feedback loop.
It's hard to improve your business if you don't know how your customers feel about it. To start retaining customers, you need a process for obtaining customer feedback and sharing that information with the rest of your organization. This is where a customer feedback loop comes in. It provides a system for collecting, analyzing, and distributing customer reviews and surveys.
There are a few ways to collect customer feedback. The most common way is with a survey, or you can ask customers to participate in user testing and focus groups. Using a few of these methods regularly should provide your team with ample and relevant customer feedback.
Once you’ve gathered them, you should analyze your survey results by looking for trends in customer behavior and other areas to enhance user experience. Then, share this information with teams that will benefit from it most.
For example, product reviews should be distributed to engineers and development teams so they can address flaws in your product's design. By using this system to collect and share customer reviews, your business can efficiently address criticism and improve the customer experience.
3. Maintain a customer communication calendar.
Even if your customers aren't reaching out with feedback, your team should be proactive in communicating with them. If customers haven't interacted with your brand for a while, you should reach out and re-establish your relationship. Consider adopting a communication calendar to manage customer engagements and create opportunities to upsell and cross-sell.
A communication calendar is a chart that keeps track of customer communication. It tells you the last time that a customer has reached out and alerts you when existing customers haven't interacted with your brand. This makes it easy to launch promotional offers and proactive customer service features that remove roadblocks before customers know they're there. For example, if a customer's subscription is set to expire, you can send out an email letting them know they need to renew their account.
4. Send a company newsletter.
A company newsletter is a simple and cost-effective way of retaining customers. You can use email automation to send updates or offers to all of your customers at once. And, you can send the email using an RSS feed on a designated frequency, so you don't have to manually update the content or remember to click "send." Even though it's simple, newsletters can remind customers of your brand every time they open their inbox.
5. Start a customer education program.
A customer education program demonstrates a long-term investment in your customer base. Under this initiative, your business creates a variety of customer self-service tools like a knowledge base and a community forum. Then, customers use these features to locate solutions to service problems before reaching out to your support team.
This program can extend beyond your products and services as well.
6. Build trust with your customers.
Two things are true when it comes to building trust between your company and your customers:
Don’t assume they trust you because they buy from you.
Trust takes time to build.
When deciding to make a purchase, 81% of customers say that trust is an important factor in their decision. Building trust isn’t a one-size-fits-all tactic that any business can implement overnight. After all, the definition of trust is the “firm belief in the reliability, truth, ability, or strength of someone or something.” Reliability is a key factor in building trust, so your company should be consistent in delivering value to customers.
Consistently following through on your brand promise and doing what you say you’ll do over time will have an impact on whether or not your customers perceive your brand as trustworthy.
7. Offer unique services.
Offering a product or service that’s superior to your competitors' in the eyes of your customers is no easy feat, but the reward is worth it in the long run. If you’ve developed a niche for your business that solves a critical customer pain point, you’re on the right track to retaining customers.
People ultimately buy what holds value to them. Eliminating a bottleneck, removing a kink in a workflow, or automating a process in a way that no other company can is a strong reason for a customer to commit to your brand.
8. Start a customer retention program.
A customer retention program is an amalgamation of several types of tactics. There’s a program for just about every business case. Below, we define customer retention programs, explain the most common types, and show you examples of how to implement them within your organization.
"A customer retention program is a specific initiative designed to encourage customer loyalty. Customer retention programs can be company-led, such as instituting a customer onboarding process, or customer-led, such as downloading and using a mobile app to make purchases."
Client Retention Program Ideas
There are several types of customer retention programs you can start for your business. If you're not sure which is right for your company, here's a list of client retention programs you can implement to delight your existing customers.
1. Onboarding Program
Onboarding is a customer success function that teaches new customers how to use your product or service. Rather than learning by themselves, customers are taught by a company representative who personalizes the training according to their needs. This way, customers not only save time but also understand how the product can help them achieve goals.
Onboarding is an effective customer retention tool because it prevents churn with new customers. When users are first working with your product, they may get frustrated if they don't understand how to use it. Customers have deadlines and they can't afford to spend time learning how to master your product. Onboarding ensures customers know how to utilize your products or services so they can complete their goals on time.
2. Customer Loyalty Program
While it's important to focus on customers who are at risk of churn, you shouldn’t forget about your loyal customers in the process. After all, what will these customers think if they see you putting all this effort in for users who don't love your brand yet? It doesn't seem too fair, does it?
A customer loyalty program should reward customers for their continued commitment. The more they shop and interact with your business, the more they're rewarded. This keeps customers happy because they're getting more from the experience than just your product or service. And, since the top percentile of your customers spend much more than the rest of your customer base, you'll want to make sure these users are more than satisfied.
3. Customer Advisory Board
As we mentioned above, your most loyal customers are also your most valuable ones. Not just because of the money they spend, but also for the information they provide. They tell you why they love your brand so much and make suggestions as to where you can improve it.
Creating a panel of these customers can help you fine-tune products and services at your business. Additionally, you can increase customer advocacy by encouraging participants to publicly share their reviews. Customer testimonials are an effective method for building rapport when attracting and engaging potential leads.
4. Corporate Social Responsibility Program
Your company is more than just a product or service. Customers look at everything your business buys, sells, and advertises to its target audience. If they sense any inconsistency between your brand's messaging and its actions, they'll be quick to recognize the ingenuity.
Instead, it's important to get involved with your customers beyond product and services. Think about their values and create a Corporate Social Responsibility (CSR) program that pursues a moral goal. While your initiative doesn't have to be as ambitious, getting involved with your customers' communities and personal goals is a great way to demonstrate your commitment to their needs.
5. Beta Testing Group
Similar to the feedback loop, customer beta testing groups serve a dual purpose — they provide your business with specific, actionable observations from the customer’s POV and they keep customers invested in the new feature your company is beta testing.
Beta testers are usually an exclusive group since every customer isn’t asked to give their feedback on a new feature due to bandwidth limitations. The exclusivity alone is usually enough to entice customers to commit to the process for a few weeks or months, but incentives like swag and gift cards can sweeten the deal.
Ideally, different customer retention programs work hand-in-hand to create a customer experience that cultivates loyalty, positive sentiment and makes customers more willing to continue purchasing.
By retaining customers, companies can help them derive more value from a product, encourage them to share feedback to influence potential new customers, and start to build a community of like-minded customers or users they can connect with. Below is a list of strategies you can start executing this week.