November 2, 2014
Customer retention is undervalued. I’m not the first person to say this, and I certainly won’t be the last, but sadly many businesses aren’t taking heed.
According to the book ‘Marketing Metrics’:
“the probability of selling to an existing customer is 60 – 70%. The probability of selling to a new prospect is 5-20%”
which would go some way to explaining why it costs 6 times more to attract a new customer, than it does to retain an existing one (Bains & Co).
These statistics should be a lightbulb moment for businesses, should make them think about diverting some of their time and budget into a solid customer retention strategy, and rightly so.
But where do you start? Whether you’ve a strategy in place that just needs freshening up, or you are starting from scratch, the tips below should get the ball rolling.
Get to know your customers…and stay in touch
The wonderful thing about existing customers is that most of the guess work is taken out of your marketing. You know who they are, where they live and what they bought from you. You possibly hold even more detailed information like how old they are, marital status, how frequently they buy from you and how recently they last bought from you.
All of this information together helps you paint a pretty detailed picture of your customers which, in turn, can help inform your strategies for keeping them. From targeting ‘we miss you’ emails to customers who have gone a little quiet, to sending through offers that are relevant to them…understanding who your customers are is key to retaining them.
And don’t forget, if you know who your existing customers are, it will give you valuable insight into who your prospective customers are too.
The best way to get to know your customers is to collate, store and use their information via a CRM system. From profiling customers to better understand them, to scheduling workflow so that you can keep in touch with them and never miss an opportunity, there are many ways that a CRM system can help you.
Make it personal
Personalising and targeting your marketing campaigns has been proven to yield more positive results than mass marketing broadcasts. On one hand, you are giving your customers that personal touch, making them feel valued and letting them know that they are more than an order number.
On the other hand you are delivering them relevant information…it doesn’t matter how well they know your brand or much they like it, if you don’t offer them something they need at a time when they need it, they they won’t buy from you.
Give something back
Nobody is happy in a relationship that is all give and no take, and that includes your relationship with your customers. They have given you their time, trust and money and if you want them to keep coming back, they have to feel that it is worth it.
There are so many options available to you when it comes to giving something back; you could invest in a loyalty scheme to incentivise repeat custom, give your important customers (i.e those who return multiple times) special discounts, or even by just making sure that you are delivering service that makes them go wow.
Often it isn’t price or product that keeps customers coming back, it’s the service they receive.
Build relationships online
In the age of online shopping and social media, your customers are nearly always online, so it stands to reason that you should be too. There are so many tools at your disposal to establish and build upon customer relationships online, Facebook, Twitter, Instagram…to name just some of the big players.
Social media is not only a marketing channel or another branch of your customer service department, to respond to questions, complaints and praise, but it also offers an opportunity for you to speak to your customers on a more personal level and show them who you are as a company.
It is this humanisation of your company that will help create bonds with your customers, and give them a reason to keep coming back.
Ensure you treat social media with the respect it deserves; have a plan, be consistent and remember it should add value to your relationship with your customers.
Ask for feedback
Stop guessing what your customers want; ask! Customer satisfaction surveys, polls & feedback forms are all ways for you to monitor your service, find what worked for your customers and what didn’t, and ask what they’d like to see in the future.
Make sure you listen to what they tell you, take it on board and then refine your processes so that your customers not only know that you care, but are given a reason to come back (or rather, don’t give them a reason to not come back!).
Don’t be shy about asking for feedback, or about shouting about it when you make improvements, “you spoke, we listened” campaigns are a great way to let your customers know that you’re constantly striving to offer the best service to them.
The bottom line is that customers shouldn’t be ignored, they are your bread and butter – the lifeblood of your business. As long as you remember this, always put them first and use the tools available to let them know that you are putting them first, then customer retention will come naturally.
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