A good marketing strategy will direct you on how to improve customer retention. Great marketing strategies involve a deep analysis of the following points:
- your target market,
- what your audience wants,
- how your products can benefit them, and
- how to achieve the ultimate goal of customer satisfaction to retain customers.
Does your marketing analysis show that existing customers aren’t coming back to you? If so, it’s time to improve your customer retention strategies! Keep reading below to find out some of the best approaches for businesses to increase customer retention.
What Is Customer Retention?
Retention: The ability of a company to keep its customers, rather than losing them to competitors – Cambridge Dictionary
A business’s customer retention rate measures the number of loyal customers returning for its services and/or consumables.
When customers use a brand repeatedly, it shows a business that its customers are satisfied with its goods or services. Obtaining a high level of customer acquisition means your marketing strategy, along with many other methods such as
- loyalty programs,
- customer engagement,
- customer service,
- and good-quality products
are rated higher when compared with your competitors.
The goal is to improve customer retention if you’re in the market to strengthen your brand identity and improve brand awareness.
Customer retention is one of the most important key performance indicators (KPIs) to measure the success of your business. A 100% retention rate is impressive, while a 15% retention rate is not a great result. So why is customer retention so crucial for your business?
Why Is Customer Retention Essential For Your Business/Brand?
If a customer tries your products and isn’t satisfied with the results, they will go to your competitors. They will also tell their friends, who in turn will also go to your competitors. Of course, it’s great to have first-time customers. But it’s retaining customers that speak volumes about your business, services, and products.
Here are a few reasons why loyal customers are essential for your business:
. Free Advertising And Brand Ambassadors
Loyal customers will likely become brand ambassadors who promote your brand and your goods and services.
Brand ambassadors produce free word-of-mouth marketing which 64% of marketers agree is the most effective marketing strategy! A study by Nielsen showed that 92% of consumers believe suggestions from family and friends over advertisements.
Retaining existing customers is cheaper than attracting new customers! When repeat customers are already familiar with your brand and are happy with the quality of the services and products, they are likely to come back to your business without having to see any advertising.
That means you don’t have to spend as much on your marketing budget and customer support.
. Improved Brand Image And Brand Awareness
Brand awareness for startups comes from a great marketing regime. Brand awareness for businesses that have been around for a long time comes from repeat customers who share their experiences with others.
A strong customer retention rate improves a business’s brand image and encourages people to shop with them over its competitors. If their family and friends keep returning, it must be good, right?
Did you know 81% of consumers need to trust a brand before they buy from it? A good brand image can help give consumers the nudge they need to buy from you.
Strategies To Improve Your Customer Retention
Suppose you’ve noticed a decline or a loss in your business’s customer retention rate or want to enhance customer satisfaction. In that case, there are some strategies you can implement to improve customer retention.
Personalise The Customer Experience
Personalising your approach to existing customers can help to make them feel more comfortable with your business. It’s a nice touch when staff remember names, ask how the kids are doing at school, and remember what they came into the store for the last time.
Collect customer feedback and implement changes to reflect that you value how your customers feel. Managing customer expectations is key.
It also helps to take this approach online too. One example for small businesses is to directly use names in their email campaigns. 78% of marketers who participated in a survey by Evergage said that a personalised marketing approach has a powerful impact.
Design A Loyalty Program
You might have a coffee card in your wallet that permits you a free coffee for every 10th coffee you purchase in the store. That makes you a loyal customer!
Businesses like Coles and Woolworths have loyalty programs such as Flybuys and Everyday Rewards that save loyal customers money when they earn enough points. A loyalty program gives customers a reason to return to your business.
Create Unique Promotional Products
Promotional products like custom water bottles, personalised desk calendars, and customised mugs, to name a few, are great ways to encourage customer loyalty.
Promotional products make your brand stand out amongst competitors. They can be used alongside loyalty programs and add excitement to your brand when given away in competitions and as freebies in return for customer loyalty.
Build a Brand Worth Coming Back To
If you’re yet to focus your attention on effective customer relationship management, you might find it highly beneficial to do so.
Attracting new clients and customers is essential. However, it may be time for you to enhance your brand image and boost your customer lifetime value by retaining your existing customers.
We’ll finish with this last important statistic: Just a 5% increase in your customer retention rate can improve your profitability by up to 75%. Start focusing on a customer retention strategy today to reap the rewards.
Lynn Martelli is an editor at Readability. She received her MFA in Creative Writing from Antioch University and has worked as an editor for over 10 years. Lynn has edited a wide variety of books, including fiction, non-fiction, memoirs, and more. In her free time, Lynn enjoys reading, writing, and spending time with her family and friends.