To simply focus on attracting new business alone is counterproductive, especially as, according to Marketing Metrics, it’s actually 50 per cent easier to sell to existing customers than to brand new ones.
What’s more, Gartner Group statistics tell us that 80 per cent of a company’s future revenue will come from just 20 per cent of existing customers. Many are fooled into thinking that if a business has a great product or service and provides an outstanding customer experience that customer retention will naturally follow. Which is true… but perhaps only for a while. Customers don’t owe you their loyalty – you have to earn it.
So how can businesses crack customer retention? If you can answer these four questions, that’ll give you a head-start.
Why are your customers leaving?
The first step to increasing customer retention is to understand why your customers are leaving in the first place. You can’t solve a problem, if you don’t understand to what extent it exists or why it is happening.
That’s where customer exit surveys come into play. Feedback surveys are invaluable for learning how the business is performing in relation to your customers’ expectations. While implementing customer exit surveys can open you up to negative feedback, it will also provide you with insight as to how you can improve your product, service or overall offering in the hope of reducing churn and fixing any issues which might be hindering customer loyalty. By carrying out these surveys anonymously, customers will be encouraged to voice any issues that they may have otherwise not wanted to mention.
Are your employees happy?
In most cases, it’s the employees who will have the biggest effect on customer satisfaction. Unhappy, frustrated workers have little reason to put in the effort if they’re not being respected, appreciated or rewarded at work. Why should they? If employees don’t feel valued, work becomes a chore and customers are simply seen as part of the daily grind.
Check in with your employees regularly to make sure they have what they need to do their job successfully. Giving your employees the right resources, training and support improves their ability to provide customers with the service they expect. An appreciated employee is a happy employee. And happy employees translate into happy customers and bigger profits for your business.
Read more about making your staff happy:
- How Alton Towers keeps its staff happy
- The ideal equation for a happy and harmonious workplace
- Top 10 benefits that will keep your employees happy
Are you nurturing the customer, or the sale?
Building strong relationships with your customers is the most important driver when it comes to customer retention. If your customers feel as though they are just ‘another sale’, they will go somewhere else without a second thought. However, if they feel as though you understand their needs and they have built a positive relationship with you, they are more likely to come back time and time again.
It’s important that businesses make the effort to continue relationships with customers after the initial purchase stage. Customer service shouldn’t just be to help answer queries when customers have an issue, but to help customers achieve their objectives. Businesses should make the effort to get in contact regularly with their clients, without being promotional. Do they require more training, advice or after sales support? It is details like these that demonstrate an interest in your customers and this will go a long way in building and maintaining long lasting relationships.
Are you utilising your customer data?
Working with different customers everyday can generate a huge amount of data for businesses. By utilising this real-time data, companies can gain a better understanding of their customers. From their ongoing purchase history to a recent conversation with a customer service advisor or account manager, ultimately, if used in the right way, analysing this information can help to fine tune business strategies and marketing efforts.
What’s more, by listening to what customers are saying on social media, marketers are able to implement positive changes, based on their current customers’ wants. For example, holding monthly webinars and events to discuss issues that customers want to hear about. By doing so, marketers will be providing customers with insights that they may have not been able to find out elsewhere.
Do you work to a “one size fits all” model?
When it comes to your customers, a ‘one size fits all’ approach will not work. Customer strategies have to be personalised to meet the needs and requirements of each and every client.
Customers today are aware of the things they want, and they will only choose those companies who are able to provide them with what they’re looking for. If they feel that their requirements aren’t being met and they are receiving generic products or service offerings, it’s likely they’ll take their business elsewhere. The moment a company tries to apply the same rule to two different customers, the personal touch is lost. While implementing a customer retention strategy may mean making the extra effort initially, low customer turnover will definitely save your business both time and money in the long run. It’s important to remember that making the sale is only the first step, and to compete in business today, it’s never been more important to create long lasting relationships with your customers, making retention a top priority.
Gregg Hollister is area director UK of media and social intelligence agency Meltwater.
Meanwhile, complaint handling is often a tricky area for businesses and can be the difference between a customer returning or not – a vital issue for SMEs.