The main priority for businesses and brands is to promote sustainable growth to help increase revenue. At the end of the day, it’s all about your ROI. As a result, it’s expected that most companies’ resources are invested into strategies that will help them acquire new customers.
However, the truth is that converting a lead into a customer requires a lot more resources than investing in customer retention strategies. You are 70% more likely to successfully sell your product or service to an existing client than you are to a new customer.
With this in mind, it becomes very clear that if you are unable to put together a successful retention strategy, more customers will churn and more money and resources will be wasted.
It’s wrong to say that customer acquisition should not be a priority for an agency or brand as the success of the business will rely on both customer acquisition and customer retention strategies to promote healthy and sustainable growth. But, knowing that customer retention can get you better results with a lower investment, a large focus should be put towards building a killer retention strategy!
What Is Customer Retention?
Customer retention is the combination of actions your company takes to encourage existing customers to keep coming back. In other words, this will boil down to the level of trust and loyalty you build with a customer that will deter them from sourcing the products or services from another agency or brand.
Let’s take a look at a few benefits of implementing a successful retention strategy:
Loyalty: Providing your customers with a good experience with your agency or brand is a great way to increase customer loyalty. A loyal and happy customer will always want to recommend and promote your brand. This is especially important for industries that rely on word-of-mouth marketing, such as digital marketing agencies.
Data: Data collected from new and existing customers can provide insights that companies can use to generate more effective strategies and increase their overall profit. Returning customers will help build a more complete profile with every interaction. This will give you a better understanding of who they are, what products they tend to buy the most, specific patterns to their behaviors, and more. All this data can then be used to help provide a more personalized experience for your customers.
Increase Profits: As briefly mentioned above, you will be more successful convincing a returning customer to buy from you again. This type of repeat business consists of a large part of a company’s profits. One study showed that by a customer’s fifth purchase they had spent 40% than their original purchase. This means that the more purchases a returning customer makes, the more likely they are to spend more money on each interaction.
4 Customer Retention Strategies
The retention strategy you pick should directly reflect your business goals. For example, if you are focusing on increasing loyalty, the strategies you pick should revolve around building trust and appreciation between the brand and the client.
Common goals could also include:
- Increase client engagement on social media
- Increase brand awareness
- Encourage customers to complete purchases
- Encourage a sense of community
Now that we have briefly looked into some of the benefits of focusing on customer relations let’s go over a few simple strategies that can make all the difference in your business’s success :
1. Customer Service
This one may seem like an obvious one, but a big focus should be put towards providing excellent customer service. The biggest mistake that many companies make is to assume that clients are perceiving the current level of service as excellent. This gap in perception often means customer service gets overlooked as a retention strategy.
Ensure that with every client interaction the client will always get the same level of care and attention. This consistency will help customers feel valued and appreciated.
Here are a couple of points that can help you improve your customer service:
- Provide multiple channels of communication. Make sure your client is also aware of the different ways in which they can reach out to your agency and brand.
- Focus on matching the client’s needs with the correct skill level. Always route a client to the right agent by assessing their needs and current issues. For example, if a client is having a very technical issue, route them to a more senior agent who has more knowledge of the technology.
2. Unexpected Gifts
Everyone loves free things and what better way to make your client feel appreciated than by giving them a gift! Gifts can include:
- Special discounts for being a loyal customer
- Store vouchers
- Discounts on specific products the client purchases frequently
- VIP discounts or care packages
Depending on the gift you decide to send your client, this is a great way to make them want to keep them coming back. Gifts and discounts are also a great way to increase brand awareness and credibility if your customer decides to share their gift on social media.
3. Communication
Consistent communication is a great way to make customers feel like they are part of your “family”. Through the use of weekly newsletters, you can update clients on new products, partnerships, exciting new product ranges, company news, and more!
4. Personalization
The more data you have on a customer, the easier it will be to show them you are adding value. Anytime you initiate a conversation with a customer make sure that you have gone over their customer profile. Focus on information that will help you understand their needs. To narrow this down you can ask yourself these questions:
- What did their previous interaction with our product/service look like?
- Have they contacted the support team before?
- What products have they previously purchased?
The reality is that no one wants to feel like they are talking to a robot and customers might feel very frustrated if they have to explain the same issue over and over again. The background research will help you show the customer how smooth and easy an experience with your brand or agency can be!
Start The Building Blocks For A Successful Retention Strategy…
Customer retention should be the main focus of any agency or brand that is looking to promote better growth and higher ROI. Now that you have a better understanding of what customer retention is and a few simple strategies, it’s time to start putting the building blocks together to build the best strategy for your industry or niche!
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