You might have come across this blog searching for ways to improve customer retention at your organization. Before we dive into the topic, let’s ask some basic but important questions…
What is the most vital asset for your company?
There are many good answers to this question; however, considering the theme of the blog, your customers are one of your company’s most important assets. And that’s quite evident from the time and resources businesses spend acquiring new customers. Although new sales are vital, smart companies focus majorly on retention.
What is customer retention?
Customer retention is keeping the clients you already have. Seems pretty simple, right? Also, you know how difficult and costly it is to get new customers. It costs a lot less to keep existing customers as compared to going out and acquiring new ones.
Why should you take care of your existing customers?
Companies that forsake retention do so at their own risk. The risk boils down to affecting profits. According to Harvard Business School, a rise in customer retention rates by 5% can improve your profits by up to 95%.
Why is customer retention important?
Customer retention generates increased profitability in the following ways:
- Better Conversion Rates
- Fewer Marketing Requirements
- Scope for Improvement
- Lower Operating Costs
- Increased Sales
Lots of research has been conducted that proves loyal customers spend more than new customers. Moreover, those profits amplify with each repeat purchase over time.
Since we have answered many crucial questions, let’s dive into the main topic and look at some strategies to improve the retention of customers.
The Customer Retention Recipe!
So, what is the recipe for keeping your existing and precious clients loyal to your company? Designing the right customer retention strategies can help your company improve customer experience (CX) and reduce churn.
These strategies include improving onboarding, great customer service, utilizing customer feedback, optimum change management, and more.
Customer Experience Management (CXM): A Vital Customer Retention Tool
There are many ways to propel and enhance customer retention. Most are centered around a robust customer experience management system, more commonly known as CXM.
A robust CXM has all the data about your customers. Then you utilize that data to augment customer retention management. A robust CXM will leverage the power of automation and integrations to help you leverage that data and turn it into action.
Optimize Your Onboarding Process & Experience
It’s one thing to acquire a customer, but to keep them is another game altogether. To do that businesses need to deliver value in terms of customer experience (CX). Your onboarding experience is your first opportunity to dazzle your new customer and inculcate loyalty at the beginning, and you should take advantage of it. Following are some things that you should practice while onboarding new customers:
Educate New Customers Regarding Your Product or Service
Newly onboarded customers have a lot to grasp. You should ensure they get the knowledge to optimum use of your product and service. Education can be active or passive, synchronous or asynchronous, formal, or informal. However, keeping a personalized approach while doing it always does wonders.
Deliver Value ASAP
Focus on providing immediate and effective value. Analyze your customer journey to identify what KPIs predict customer success and drive customers to those activities from day one.
Offer “Quick Start” Guides and Tutorials
Making your customers’ lives easy always adds to the value provided. It becomes easy for your customers to succeed by providing the tools they need to hit the ground running. Produce content that spotlights those key predictors of success and makes that content easily accessible.
Provide Contextual Onboarding
Bombarding the customer with every piece of information can generate confusion. Not every customer needs every feature of your product or service right away. Contextual onboarding can provide the right information at the right time for each unique scenario.
Listening to Your Customers is a Virtue!
Most of the time customers have strong opinions, and you can benefit from those opinions to bolster retention. Social media makes it easy for customers to express themselves and what they desire from a particular product or service. However, turning those feedback into valuable data can be achieved using a robust CXM Platform.
Smart businesses set up a customer feedback loop using the Customer Experience Framework to help them find out what their customers like and do not like to take advantage of all they have to offer.
1. Collect Data
Use polls, surveys, and other feedback techniques to know what customers think of their experience with your company. They also help you understand what customers care about and expect from your products or services. Basically, you should have a sense of what makes customers happy and what makes them angry.
2. Learn from Customer Complaints
Complaints can drive effective service in the future. They are so crucial because most customers don’t complain; they just leave!
In fact, for every complaint you receive, there are around 26 others out there who are dissatisfied but not complaining. So those complaints should be considered as a commodity. Customer complaints offer you a clear path to what you need to work on to improve your Customer Experience Framework.
Make sure to offer avenues for customers to lodge these valuable complaints. You should be aware of the preferred communication channels of every customer. Make sure your company is analyzing, resolving, and learning from this important feedback.
3. Concerns Should be Addressed ASAP
It is evident that you can’t do everything all at once; however, executing the most important things first always works. Once again, data can be your biggest ally here. Utilize all the resources at your fingertips (and in your CXM) to pinpoint what is most important, and then make a plan of action.
Optimize Change Management
Your products and services keep evolving; however, new products and features mean change and change can be hard on customers. It’s frustrating when you open your app and things aren’t where you left them.
It is overly critical, how you manage change. You can either leave your customers to figure it out themselves—and maybe quit trying to do so—or you can walk them through this crucial moment systematically. Offer effective and punctual resources to foster customer success. Following are some strategies for keeping customers updated about the inevitable change and growth in your company.
Asynchronous resources in your knowledge base are crucial to any updates or transformations to your products or services. The point is they need to figure it out right away when they see the new icon. Generate knowledge base personalized videos that can enable the customers to get a heads-up about the change.
You should reach out to your customers via their preferred channels about the planned changes in advance and at the time of the change, so your customers are aware of what’s going on. After all, nobody wants to log in and find their favorite feature is gone. Amplify the value of communication by using links to resources and webinars. That way your customers are ready with instant support and don’t have to go searching for help.
Personalize Customer Interactions
Do you know?
One-third of customers leave a business because of a lack of personalization. So, it clearly makes sense to keep personalization on the top throughout the customer journey. Again, an effective CXM platform can help you to personalize every interaction and help you utilize profiles to store data so you can customize each communication touchpoint with ease.
The 101 rule of personalization is using the customer’s name, but you can take it to the next level. Analyze their specific issue or problem, and check if your product or service is helping to resolve them. If you’ve added this data to your CXM, it becomes a cakewalk!
Create a frequent communication calendar or a programmed order of events, phone calls, exclusive offers, and more. Once again, your CXM will come in handy to help you map your customer journey and find the major moments to connect.
Automation Tools can Make Your Life Easy!
As we have talked about so many techniques to optimize customer retention management, it is quite clear that executing the process is labor-intensive. After all, you can’t create a personalized message for each of your customers. That’s where the concept of automation comes in. Take advantage of the wide variety of CXM tools to help you retain every hard-won customer and keep sight of prospective customers.
Identify Signs of Churn
Your CXM can hint about customer churn. Make sure you’re keeping a track of the KPIs that depicts engagement. You can then utilize customer behavior and triggers to take action. Haven’t heard from a customer in a while? Are purchase patterns changing? All of this data is at your fingertips.
Re-engage with Customers
Automation can be a powerful tool to re-engage with customers that you have lost touch with. We all lead busy lives; however, this doesn’t imply you should let your leads go in the freezer. Most CXM tools can notify account managers when it’s time to reach out.
Chatbot implementation on your website is also an efficient way to re-engage with customers. These bots can utilize IP addresses and browser cookies to provide personalized conversations along with returning chances the moment they visit your site.
These interactions are going to become more common. It is stipulated that chatbots, voice assistants, and interactive voice response (IVR) will propel around 95% of customer interactions by 2025, therefore cutting the workload on your representatives.
On Your Way to Reduce Customer Churn Rate
Customer retention is the required supplement for a thriving bottom line. Luckily, the right CXM platform contains all the data you require to develop an effective retention plan. Data is everything and it gives you a clear view of customer habits, patterns, and more. This helps you analyze customer behavior. Combined with sales and marketing automation, the platform can help you avoid customer churn and ultimately boost your share of your wallet.