Customer Retention: A Smart Strategy For Business Growth
by Abdul Aziz Mondal Business 11 April 2023
Customer retention is key for business growth – in fact, a 5% increase in customer retention can boost revenue by 25-95%. It’s also cheaper to keep your existing customers, and 6 to 7 times more expensive to acquire new ones. With customer retention, you’re basically making money off the customers you already have, rather than spending money on acquiring new ones. So, by implementing smart customer retention strategies, you can successfully earn customer loyalty, improve your bottom line, and grow your business.
Create A Memorable Onboarding Experience
Once a customer makes their first purchase from your business, it’s important you leave a lasting positive impression. Your customer onboarding process should therefore be carefully crafted and focused on providing excellent customer service every step of the way. If a customer’s earliest interactions with your brand include mistakes (such as long response times, information overloading, or neglecting data privacy), their experience may be soured – even if you’re quick to solve any problems. In fact, 82% of customers say they’ve stopped buying from a company due to a poor customer service experience. To create a smooth and effective onboarding process for customers, establish a comprehensive workflow featuring automated follow-up emails, a self-serve customer service library, and engaging celebratory messaging once customers completed their onboarding.
As you retain customers and grow your business, it’s also important to reassess your chosen legal structure to ensure it’s still the right fit. A limited liability company (LLC), for example, is beneficial as it provides personal liability protection – that means your personal assets like your home, car, and savings, are protected if your business defaults on a loan or is sued. To form an LLC, you need to use a registered agent service; Northwest Registered Agent, for instance, provides LLC formation in every state. By taking time to read this in-depth Northwest Registered Agent review, you can determine whether this service is the right for your business.
Ask For Customer Feedback
Customer feedback is essential for learning what is and what isn’t working for your business. By making changes to provide customers with an even better service, you’ll pave the way for future growth. When it comes to collecting feedback from customers, you’re not limited to any single method. A customer survey, for example, is a common method businesses use to identify ways to change and grow, as well as build an overall stronger relationship with their customers. By asking a range of specific and open-ended questions, you can create a clear picture of how customers perceive their interactions with your brand. So, for example, your survey may ask questions like “How satisfied are you with your purchase on a scale of one to “How can we improve your experience with our business?”, and “What can we do better?”.
Then, once you’ve collected your data, it’s time to analyze it – focus on looking for trends in customer habits and opinions. You can then share this information with relevant people within your business, so improvements can be made as needed. So, for example, if you’re looking at product reviews that draw attention to problems with product design, you can pass this feedback on to your development team to resolve these issues. Ultimately, by implementing this step-wise system to gather, share, and act upon customer reviews, your business can address both negative and positive criticism and strengthen the customer experience.
Communicate Regularly With Your Customers
Regular communication should be the foundation of your relationship with your customers. So, be proactive in your communication efforts. If customers haven’t interacted with your brand for some period of time, try reaching out to them to renew the connection – this way you can better stay at the forefront of their minds. In fact, you may want to keep a communication calendar to keep on top of your customer communication history, while simultaneously creating new sales opportunities. The calendar can keep track of the last interactions you had with your customers, and you’ll also be notified when a customer hasn’t interacted with your business for a while. Essentially, a communication calendar can make it easier to attract and retain customers and eliminate potential problems – for instance, if a customer subscription plan is coming to an end, you can simply send an email informing them about the need to renew their account.
Moreover, you can also consider launching a company newsletter: a simple, affordable, and effective customer retention strategy. Newsletters can strengthen your brand’s credibility, and remind customers of your brand whenever they check their emails. In fact, for every $1 you spend on email marketing, you can expect an average ROI of $45. And, with email automation, you can easily blanket-send updates or offers to your entire customer base.
Customer retention is essential to thriving in the long term. By creating a memorable onboarding experience, asking for customer feedback, and communicating regularly with your customers, you can earn customer loyalty and enjoy greater business growth.