How to Improve Your Customer Retention Rate?

December 4, 2020

Retaining your customers is an important factor to help your business succeed. Gaining new customers is good, but retaining existing ones is even better. When customers keep purchasing from you it means that they are loyal to your brand and enjoy your products or services. But along with the performance of your products or services there are many other things that count. Customers like to do business with companies that make them feel valued and provide them with a great personalized experience. In this article, we will discuss some strategies that can help businesses improve their customer retention rate.

Customer retention is important because it ensures that your customers stay loyal to your businesses and continue to have a long-term relationship. This can help businesses improve their ROI and reduce the cost of acquiring new customers. Existing customers have more potential to bring in revenue.

Let’s take a look at how customer retention is important for your business.

What is customer retention?

Customer retention is the process of engaging your existing customers so that they continue to invest in your business. Customer retention rate is the metric that measures the number of customers a company continues to do business with over a certain period of time.

Benefits of customer retention

  • Customer retention rate can help you see how satisfied your existing customers are with your products or services.
  • The cost of acquiring new customers is high. Retaining existing customers is more cost-effective.
  • According to HubSpot, increasing customer retention by 5% can help increase a company’s revenue by 25-95%. This means you can increase your return on investment or ROI.
  • Retained customers are more likely to keep buying from your company and are willing to spend more.
  • Customers who are happy with your business will bring in more referrals. They will be delighted to share your company’s reference with their friends, families and colleagues.

Here are some strategies that can help your customers stay loyal to your business.

Strategies to improve customer retention

Personalize your customer’s journey

Personalizing a customer’s experience makes them feel valued. Every customer would have different needs and you need to cater to them accordingly. Customize the content you send them. You may send customers emails or newsletters often, ensuring that it is something that they enjoy engaging with is important.

Customers like engaging with content that educates them. Sending them informative blog articles, newsletters or emails can help you provide value to them and also keep in touch with them regularly. Create and share posts on social media that are interesting to your customers. Customers are more inclined to do business with companies that educate them.

Onboarding Customers

Onboarding customers helps them learn how to use your products or services. Customers are provided personalized training by companies as per the needs of the customers. This can provide customers more knowledge and help them use the product or service efficiently for success. Onboarding can show customers what they can expect to gain throughout the relationship with your company.

Customers can run into multiple problems while using your products or services. This can interfere with their daily business and can put things on hold. Onboarding can enable them to discuss all their queries and problems early on to avoid any delays later. It will ensure smooth functioning of their business and help them achieve their goals. This increases their trust and confidence in your products even more.

Use case studies during sales process

Using case studies during the sales process can show your customer how your product and service can solve their problems. By looking at how you have helped other customers, potential customers can trust your products to help their business. It is a good way to share the positive results your previous customers achieved with your help. Case studies also show customers how your team works with their clients.

Along with case studies, you can also share testimonials from previous customers. This can influence new customers to make their final decision. When you set their expectations early on, customers will understand your plan to help them and this will create a good experience with your brand. It will increase their trust in you and assure them that you will deliver on the results.

Discuss progress regularly

Customers will continue to invest in your products or services when they see that it has given them positive results and ROI. Once customers see how you have helped them achieve a certain goal, they are more likely to continue business with you. Following up with them to discuss progress every step of the way is a good practice. This shows them that you care about the progress of their business.

Even if the results are not as expected, you can discuss where there is room for improvements. You can also provide them with further inputs that can help improve their results. Looking at the progress made can make customers more confident about using your products.

Upsell and cross-selling

Cross-selling and upselling are strategies to gain more revenue from existing customers. Cross-selling is purchasing anything that will pair well with the primary product. Upselling is influencing customers to purchase anything that would make the primary product more expensive. This can be an upgrade that would create a better experience for customers. These are good strategies to help increase revenue. As discussed above it is more expensive to gain new customers. With these strategies you can gain more from a single existing customer.

To encourage this, you can provide customers with more information on other products apart from the primary one. When customers are going through any products on your website, you can place these additional items to cross-sell. This can show customers which products work well together. To upsell you can show them how you can upgrade an existing tool to make it more efficient. These strategies can show customers the benefits of using two or more of your products or services to complement each other.

Use a CRM system

Customer Relationship Management or CRM tools help you manage your company’s interactions and relationships with your customers. CRM systems are designed to improve customer relationships. It helps you store your contacts as your customer base grows. With the help of a CRM system, it becomes easier to track all your communications with customers. You can see when a particular customer was contacted last. This will help you stay on track with communications with your customers.

With the help of CRM tools, you can also automate your emails and send them to the list of people intended. These emails are sent out automatically based on the actions you set. This will make the entire process of sending emails efficient. You don’t have to spend time sending emails manually to each contact. It will also ensure that you send follow emails to the people already contacted. With a CRM tool you will not miss out on any leads and communicate with each one to nurture them.

Improving your customer relationships can contribute to retaining your customers. Maintaining a regular conversation with them can help your customers feel valued and they are more likely to keep purchasing from you.

Click here to find out more about how customer realtionship management system is beneficial for your business.

Ask for their feedback

Feedbacks are beneficial for your business in many ways. It can help your customers feel valued and you can attract new customers. By asking customers for their feedback, you show them that their opinions are important to you. When customers feel like they are important to your business they would want to continue their relationship with you. This can also show you where there is room for improvement. If customers feel like some areas can be improved that is a good opportunity for you to learn more about their preferences. And this can be useful to your relationship with many other customers.

Having a positive testimonial on your website can help your brand build trust and credibility. Consumers always look for testimonials or reviews to help them with their buying decisions. These testimonials can help you gain the confidence of many other potential customers.

All these strategies can help you create a great experience for your customers. Great customer experience will mean a long-term relationship with your present customers. This can help your business increase customer retention rate.

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