Customer Experience Is The Key To Any Business? How Customer Retention Help You Become Successful
Customer retention is the key to drive business, no matter what industry you run. We have competition everywhere and to survive in this market customer service plays a primary role. The success of your business is directly connected to your customer service.
A number of people are coming into the market with new business ideas. The things which make them different is the level of customer service they provide to their customer, irrespective of the quality of product or service they provide.
Let’s First Know What is Customer Retention?
Customer retention is the efforts and actions company or organisation put to increase their customer’s satisfaction and retain them for an extended period.
It mainly involves improving your customer engagement to take your product or service and preventing them not to inclined towards your competitors. You can do this in various ways by understanding the customers and offering them what they need at a current point of time.
How Important is Customer Retention?
Many of the leading business entrepreneurs believe that instead of spending efforts on gaining new customers its better building customer retention. Moreover, they don’t look at cost while delivering great customer service but as an opportunity to get better sales. With this thought, they are ready to spend 21% additional for great customer service.
Here are some of the statistics according to McKinsey’s study which helps you in understanding the importance of customer retention:
- Gaining a new customer is 5-25 times more costly than retaining an existing customer.
- 70% of people make their buying decisions based on the type of customer service they provide.
- Increase in customer retention by 5% will increase profit by 80%.
- 33% of customers change their vendor if they find even one-time dissatisfied customer service.
- In B2B business, 51% of customers won’t prefer to do any deal with a company after one time negative experience.
- 74% of people opt for a new brand if they encounter difficulty during purchase.
- 64% of people give preference to customer service than the price during purchase.
- 77% of customers refer your business in their network after having a positive experience.
- According to Accenture, only 23 % of companies were able to provide good customer service and remaining failed to do so.
- Four years ago, customer experience and customer retention were not something which business focus. With digital transformation, it became mandatory for every business to focus on customer retention.
- According to Gartner report-In the upcoming years, 89% of companies will compete from their competitors based on the customer experience irrespective of the quality of their product or service.
What are the Benefits of Customer Retention?
According to crazyegg.com– The probability of selling a product or service to the existing customer is 60-70%, and for a new customer, it’s 5-20%.
When your new products come into the market, your loyal customers are more likely to spend 50% more than new leads.
Let’s list the benefits of customer retention
Customer Retention is Cheaper than Acquisition.
Gaining new customers is expensive and takes your time. While maintaining the customer is easy compared to that. You can easily retain your customers by providing them offer, creating generic loyalty programs, nurture campaigns, and discounts — no need for putting extra efforts on your existing customers for marketing and time on customer support. For new customer, you need to start from scratch which includes a number of steps from introduction to the delivery of product or services.
Make your Customer Repurchase
Generally, the customer maintains their loyalty towards one brand once they get satisfied with their product. Loyal customers are likely to spend more than new customers. Moreover, they prefer to buy from the same brand. Valued customer service is one of the tools which you have to beat your competitors and retain your customers. For this, you can remind the customer before the expiry of completion of product or service after a certain period. Your reminder can help customers to repurchase the same or else if your competitors come with the new offer then there is a possibility is to divert your customer to your competitors.
Gain Word of Mouth Marketing
Loyal customers who enjoy your customer service and quality of the product they do mouth marketing for you, and you can save here the advertising cost. Generally, customers who repeatedly purchase the same product discuss with their network. New customers give more value to the review or reference from the used customers than the advertisement of the company. People enjoy telling their experience to others if they get a valued service. The customers which you gained from referral have high value, and they continue with you for a long time.
Get Valuable Feedback from Customers
Your retain customers can provide you with valuable feedback. Everyone is not perfect; your retain customers can help you in working on your pitfalls from their feedback. Because they are using it repeatedly, they know more about your services and products, and you can get the genuine feedback of your product or service.
Learning from your mistakes will help you to gain new opportunities for your business and retain your customers. Your loyal customers can help you to take your business to a new level.
Obtain the Right Price for your Product
Retained customers know the importance, quality and value of your product or service. Even when you increase the price, they don’t think much about that, and they pay for you for your valued service. While in the case of new customers, they analyse various factors before purchasing and it’s somewhat a time-consuming process to accept those price like they want to go for a trial first before purchase and similar other.
What are the Customer Retention Strategies?
Analyse Customer Expectations
Set customer expectations and align your deadline to meet them. It improves trust in the customer, and they are more likely to go with you even in case of an emergency.
Reduce Customer Attrition
Don’t lose your customer at any point in time. Annually people lose 20 % of their customers just because of poor customer service.
Reach with Right Offers
Reaching your drop out customers with exciting offers is the best technique to bring back your lost customers.
Prepare Communication Calendar
Maintain the frequency to reach your customers in different ways with a variety of offers to them. You can approach them with some business news like your success stories, the launch of a new product, and similar other which can benefit at that instance of time using your behaviour pattern.
Astounding Customer Service
Deliver service beyond your customer expectations, is the only mantra which helps you to retain your customer. People are more inclined towards brands who are dedicated to customer satisfaction. It can include- immediate response, on-time delivery, error-free delivery, zero defects, quick response to queries, and others.
Make your Customer Feel Special.
Greet your customer on occasions like birthdays, marriage anniversaries and others. Provide special offer exclusively for them on their special day. This practice makes your audience feel special, and they give preference to you over your competitors.
Collect Feedback from Customers
Keep a drop box in your offline store or online comment section or feedback form in your website which helps customer to keep their word in front of you. It will help you to work on your pitfalls and maintain customer retention.
Surprise your Customer with Gifts
You can send your customers a gift specific to them how expensive it is doesn’t matter. However, it should make a mark on their mind. So they never leave in future for any brand.
Interact with your Customers
Send your customers to welcome and thank you note for taking your service. Apologise for your mistakes and come up with a more satisfying response. Assist your customer by providing information about your product and help them how they can spend their amount on the right product and defining features in a clear way which help them in every aspect.
Good customer experience comes when you take care of your customer from the start of advertisement till you follow them in future.
Customer retention plays a primary role in getting business even in the long run. It helps you to gain customer with low advertisement cost and maintain loyalty and trust of the customer towards you.
Customer retention is far better than customer acquisition. It saves your time & cost, and existing customers are ready to pay you more & spend more on your product or service because they value your service.
Various customer retention strategies are there, choose which suits your business and implement to reach your business goals.
Hope you now got how necessary is customer retention for business. Please comment on your customer experience with us.