Unlock Top Customer Retention Strategies for 2023

One of their very first push notifications got a 15.2% click-through rate. When they implemented the variation to all traffic, it increased their total sales by 14%. The new option removed excess scrolling from the experience of a typical customer, so they were ready to put it to the test. It’s one of the leading retailers in the Netherlands for replacement parts for computers, cell phones, power tools, and other electrical equipment. This experiment gave Northmill another effective channel for reaching their customers and prospects. They used A/B testing extensively to improve their checkout experience, removed unnecessary items, and made it easier and more effortless to use.

They were unhappy with the completion rate of potential customers that added products to their cart and started to check out. Customer satisfaction (CSat) is quite similar to NPS tracked by owners and experience optimizers. While NPS signals the loyalty quotient of a customer with respect to the brand, CSat helps gauge how satisfied a customer is with their product/service. ECommerce businesses can set order value thresholds that must be met before you include a gift or handwritten note. That way, you start relationships with potential high-value customers off on the right foot.

Net promoter score (NPS) helps analyze the likelihood of a customer recommending your products/services to their family, friends, and peers. Crafted by Bain & Co., NPS has turned into one of the most critical metrics to track customer retention rate and gauge the customer-centricity of a brand in the market. You don’t need to implement complex strategies or use expensive tools to create better customer relationships. But, improving customer experience and getting more satisfied users don’t have to be an expensive, high-tech endeavor. Implementing a simple customer feedback loop can help find and apply insights that improve your retention rate. Such data helps marketing teams take the guesswork out of the picture and create marketing campaigns that are sure to convert more customers into loyal customers.

Customer lifetime value shows how much profit the customer contributes to the company during their entire time doing business with the company. CLV is an important metric because https://www.xcritical.com/ it points to whether your company needs to encourage customers to make additional purchases. If CLV is low, you can invest in loyalty programs to stimulate repeat purchases.

Aside from the ability to execute conversational sales and support strategies, it also creates a better CX for clientele. When businesses offer omnichannel support, customers can chat with a person on the platform of their choice and receive faster resolutions. Customer lifetime value measures the total revenue you can expect from a customer during their lifetime and helps a business discover its most loyal customers. The longer a customer remains loyal to a company, the higher their lifetime value becomes.

75% of consumers expect consistent experiences across multiple channels, and 73% are likely to switch brands if they don’t get it. Even if you sell a consumer product, following up with basic instructions, top tips, or even recipes, can be a powerful way to start building a meaningful relationship with that customer. When it comes to customer retention solutions, a huge mistake made by companies, regardless of their industry, is that they stop communicating with customers as soon as the sale is made. Successfully personalizing your loyalty program can lead to a 5.2X lift in word of mouth mentions, and a 3.5 lift in spending caused by the program[17]. Treating each customer as an individual is a key to retaining the maximum customers.

Product

A community leads to a feeling of belonging that customers might not get from other companies, making them loyal to yours. While well-known in the retail world (grocery stores, beauty retailers, and clothing stores all commonly offer these programs), SaaS companies are also hopping aboard the rewards train. If there’s an issue, customers want to contact you right away—in a way that’s convenient to them. If it’s easy for them to get their issue resolved, you’ll likely gain a customer for life.

Dave realized the users who added recurring expenses during the onboarding process showed a higher retention curve than the ones who didn’t. So they revamped the onboarding process to focus on adding recurring expenses, and three months later they had 5.7X higher retention rates. 70% percent of consumers want brands to take a stand on social and political issues. Another recent study showed that 77% of consumers are motivated to buy from a company committed to making the world a better place.

Form a community around your product or service.

Most customer retention strategies are based on the numbers – ie how much you’re willing to invest to keep your customers loyal. That investment could be put into developing exclusive product offerings for your best customers, or invested in discounting to prevent customer churn. It still holds true today that it costs much less to retain an existing customer than it does to acquire a new one.

Customer experience (CX) and customer relationship management (CRM) systems are significant components of the customer retention process. Once you figure out what makes your customers tick, they’ll want to buy from you again and again. Collect quantitative and qualitative data directly from your customers to see what they need to make their customer, user, and product experiences as comfortable as possible.

Get the insights you need to improve customer retention

Some customers cost more to serve than others, so you need to be able to understand the value of each customer or customer segment to your business. You need to know how much you’re paying to serve each customer segment to make an informed decision about how much to invest in customer retention. With this in-depth guide, you’re all set to start tackling retention issues within your own company. Increasing the number of new customers seems like a natural choice if you want to grow your business. Digital channels make it easy to reach a large audience, and with access to unlimited data, it’s easy to customize your messages and optimize your ads. Early messages showed click-through rates as high as 27%, over ten times higher than the average CTR of email campaigns.

Create personalized loyalty programs that reward customers for making repeat purchases. By creating personalized special offers and offering discounts to loyal customers, you motivate people to keep transacting with you and improve retention rates. This is further supported by the fact that personalization can boost customer retention or reduce churn by 25%. The more purchase data you have on your customers, the more you can personalize your rewards program, further delighting them and giving them a reason to stick with your business. Any area of the business you turn a critical and constructive eye to should, in theory, benefit from that attention. As retention rates go up, churn goes down, leading to an overall more efficient and profitable business.

How to calculate your customer retention rate

If brands support social causes, there’s a higher probability they’ll be more effective at retaining their customers. Retaining existing and dormant users is easier than gaining first-time users since you have or have had an existing relationship with them. Focusing on existing and dormant users is a smart approach to boosting customer retention since there’s more relationship data available on these two cohorts of customers. Discover how to improve customer retention by leveraging retention metrics and implementing customer retention strategies. Research shows that about 60% of consumers won’t return to a brand after only a single poor customer service experience.

• Segmentation is the first step to providing them with a better experience and gaining their loyalty.
• Customers already know your brand, they know your products, and they appreciate your service.
• The good news is that if you’ve put in the effort to get to know your users, this part will be easy—and even fun.
• Reducing call center volume is generally considered to be a reliable way of boosting customer satisfaction and reducing the likelihood that a customer will turn to a competitor for services.
• Your customer support team should be able to pull relevant customer information to get context and deliver personalized interactions with your customers.

The more loyal an individual becomes to a business, the more likely they will try new products or bring in new customers. Ideally, different customer retention programs work hand-in-hand to create a customer experience that cultivates loyalty, positive sentiment, and makes customers more willing to continue purchasing. If there’s one thing you should know about customer service, it’s that empathy is key to building lasting customer relationships.

Whatever you do, make sure that you set and communicate challenging but realistic goals, involving everyone who has a stake in delivering. Don’t make promises you can’t keep and don’t promise for other departments if you have no control over the outcome. Brainstorm some ways you can surprise your customers with a kind gesture. For example, at Help Scout, we occasionally send handwritten notes and swag to our customers just to say thank you. And while reciprocity works incredibly well on its own, research shows it’s far more powerful when it’s a surprise. The gesture probably wasn’t all that unusual, but the fact that it came out of nowhere likely left a strong impression on you.

You’re all set!

Here are eight strategies you can use to create a winning customer experience and keep your customers coming back. 72 percent are willing to spend more for a company that offers good customer experiences. And 50 percent say that customer experience is more important to them now compared to a year ago.