How To Improve Customer Retention
TLDR: Customer retention is extremely important for any business because it provides a reasonable guarantee that you have patronage regularly. By tracking your retention rate you can more accurately predict customer churn rate, then directly influence it. Utilizing a personalized onboarding experience for customers, developing trust and transparency with said customers and maintaining regular communication, retaining customers is a simple way to ensure regular business.
There is massive value in retaining customers. It means you can reliably remarket to them at a lower cost while preserving a steady return on your initial investment. We compiled this all-in-one guide to make retaining customers easier. But first, let’s take a deeper look at what customer retention is and how you can calculate your retention rate more accurately.
Finding Your Customer Retention Rate
To start off, let’s properly define customer retention. It is a common metric that businesses use to measure their customer’s loyalty, which is directly tied to their overall experience interfacing with the company. Specifically, customer retention analyses the number of customers gained in a period of time versus how many are churned.
Protip: Customer churn is a fancy way of labeling customers who drop off from your service for one reason or another. It is essential to know what your churn rate is in order to know your retention strategies are working.
Thankfully, there is a simple formula to calculate your retention rate:
(Total # of Customers at the end of the Period – New Customers Acquired)/(Customers at the Start of the Period) = Customer Retention Rate
Once you have your current retention rate, you can begin to employ the following techniques to drive that percentage much higher!
How To Retain Customers
It’s time to look directly at some of the strategies that have proven successful in developing more customer retention! All of the things we are going to cover work best when used together but you may find that you are already doing some things well but need to focus on other areas more!
Have A Strong Onboarding Experience
The process starts right at the beginning! When a customer makes a purchase from you, this is your initial opportunity to make a great first impression. What we mean by this is that you need to make sure that the onboarding process is as smooth and simple as possible!
Some things to avoid are:
- Mishandling or mix-ups of information. Customers shouldn’t have to give you anything twice.
- Multiple points of contact. Talking to two or three people who all ask for the same information is frustrating and portrays a lack of organization.
- Badly timed follow-ups. Keeping to a timeline that is transparent and set out ensures that the process keeps moving forward.
You can enhance the onboarding experience by using automated workflows for triggering emails, self-service knowledge base access, and celebratory communication. Utilizing a CRM platform like CHIIRP is a surefire way to wow and impress new clients while easily managing automated onboarding!
Personalize The Customer’s Experience
Every customer is looking for something unique when they approach you for services. Anticipating those needs and personalizing their service guarantees that they have a good experience and come back for more!
Carefully examine each client’s problem to find a solution that makes the most sense for them. Crafting one-size-fits-all solutions that ignore the preferences of the client are detrimental to their experience and will cause them to churn over time.
This may sound simple but it is also an important aspect of customer retention. The amount of trust a client has in your product or service takes time to grow and is primarily affected by:
- How reliable is your service
- How consistently do you uphold your brand promise
- How transparent are your actions and operations
Don’t be afraid to show your clients your process and communicate with them openly about what you are doing for them. Creating a timeline and adhering to it no matter what is another great way to build trust. Make sure that you can meet expectations regularly and exceed them whenever possible.
Invite Customer Feedback
Knowing how your customers feel about their time with your company is a valuable tool. How can you improve their experience if you don’t know what they liked or disliked? Having a feedback loop in that you invite your customers to participate shows that you care about their experience and are actively trying to improve it. It also shows potential customers that you are willing to earn their loyalty!
Surveys are a great way to accomplish this. Utilizing CHIIRP, you can automatically send surveys to someone who just purchased your service and compile them all in one place for review and implementation!
Make sure that you are actually making changes based on what feedback you receive. Inviting criticism is pointless if you are not committed to listening to it, and becoming better!
The importance of customer retention in business is huge. You can influence it by having a tight and easily navigated onboarding experience, personalizing your services to each client, and building trust with consistent service and feedback implementation!