Every company’s main priority is to find new methods to bring in more revenue. More profits translate to growth, and growth is what all ambitious entrepreneurs look for.
But even though raking in more profits means selling more, one should never place all their focus on acquiring new customers. Focusing all your efforts on customer acquisition means neglecting an equally important aspect – customer retention.
It can work wonders for a business looking to grow, and it is always cheaper to retain and maybe upsell the current clients compared to acquiring new ones. If this sounds attractive, keep reading and learn about handpicked customer retention strategies that you should have under your belt.
Importance of customer retention
Customer retention is the effort (or a group of actions) taken to encourage customers to do business with your company over and over again.
Customer retention is cheaper than customer acquisition simply because the reach is narrower. A business does not invest in reaching new people and grabbing their attention, but instead, it tries to cater to the current customers’ needs to entice them to come back and buy more.
Logically, a company needs both customer retention and customer acquisition to succeed. But the more a business grows, the higher the need to place special emphasis on customer retention becomes.
Let’s move on to some of the best retention strategies.
Consult a business coach
When working on your customer retention efforts, one of the best things you could do is to hire trusted business coaches. A mentor who is an expert in the world of business can help you make better decisions that will, in turn, increase your customer retention.
The decisions a business owner makes are the main factors that determine further success or failure. This covers each business process, customer retention included.
An experienced business coach can help an entrepreneur approach customer retention the best way possible in a given situation. So, have a good mentor by your side when reflecting on what the client is doing and see if you can spot a few new pain points that can be used to persuade the person to lean back to your business.
Keep in mind that you may not spot these on your own. However, when there is an experienced coach by your side that has guided dozens of companies through similar situations, the chances for success increase.
Rely on a good analytics tool
To know what exactly you need to do to boost your customer retention efforts, you should first evaluate the current state of things regarding that business area.
In other words, it is important to track customer retention rates. This metric describes the portion of clients your business has retained over time. The retention rate is the opposite of the churn rate, which indicates the number of clients your business has lost over time.
A wise move, in this situation, would be to use Google Analytics to track this important metric.
- To do this, log on to the Google Analytics website. Click on the name of your website (the website you want to evaluate).
- Find the Audience section and click on it. It is located on the left side of the Analytics Dashboard page.
- The Visitors Overview report shows up in your web browser and indicates the aggregate number of visits to your business’s website for the current month, aggregate unique visitors, overall page views, bounce rate, page views per visit, and new visitors.
- Once you see all the figures, try to estimate the aggregate new visitors.
- This number (new visitors that have checked in for a given period of time) will offer you a percentage of the aggregate number of new people who checked into your website in the present month or a pre-defined time period.
- Then, divide the estimate by the total number of visitors. Also, click on the Behavior button if you want to learn more about the behavior of people that visit your website (how long they stay, how many times they visited, etc.).
- Finally, check the rate of returning users. This can be done when a user clicks on Frequency and Recency that is located on the navigation pane. A report shall be generated.
- Higher percentages mean that the website has great retention rates. Lower percentages, on the other hand, indicate the opposite.
Prepare special offers
To prepare the best possible offer for your customers, you have to know them well first. So learning more about your customers is a prerequisite for this tip.
To go through the whole process smoothly, check a selected customer’s purchase history and find out what kind of offer might be the most appealing. Then prepare an offer that is attractive and relevant enough to keep your business on top of the customer’s mind.
Identify what you need to do to spark their interest and convert that into a purchase. Offer a discount if you have to.
For instance, there may be some customers that have displayed an active interest in your product but haven’t purchased anything for quite some time. In that case, create a list of all customers belonging to this category and compare it to the subscribers’ list for your newsletter.
Once you do that, you will see contacts that are actively interested in your product, but they have not shown any activities for a while. Prepare and send them a special offer deal or a discount on a new product and make them feel appreciated and valued. They have to know that you still remember them.
Reward VIP customers
Take a look at the customers that are your best buyers. The people that are willing to spend a lot on your business are the ones you need to place a special focus on.
The VIPs bring you the most revenue, and you should return the favor by focusing your time on them and thinking of a way to repay them for their loyalty.
For example, if you have a number of incentives to give away, use them to reward the VIP customers. This will not only show them that you care, but you will also improve their loyalty, and they will be back in no time to buy more from your business.
Create a list of these customers, follow up with them and let them know about the rewards and incentives to make them feel special. When you do this successfully, they will remain your most profitable customers.
Develop a frequent communication calendar
A well-built communication calendar is what businesses use to keep in touch with their customers at regular intervals. The calendar you should make is a predefined sequence of events, phone calls, emails, special offers, handwritten notes, and so on, that you should send to your customers.
If you don’t want to make this calendar manually, you can probably find a good program that will make the process easier, such as Microsoft Excel.
The sequence of events is great for pre-sale, sales, and post-sales processes. On top of that, businesses that have a communication calendar usually engage their customers easily. The essence is that frequent communication eliminates post-purchase doubts, improves trust level, and persuades the customer to come back again.
Frequent communication will make customers feel valued and important. You are keeping them informed, and they feel as if they have a say in your business decisions, which is a great customer retention booster.
Final thoughts
These strategies have worked for many businesses already, and there is no reason why they shouldn’t work for your business too. However, it is important to implement them properly. Keep in mind that none of these guarantee quick success.
It is necessary to be patient when implementing them. So, do your best and don’t give up even if you don’t see instantaneous results.
