How do you ensure your brand or product remains fresh in everyone's minds? Undoubtedly, constant innovation is the key to leading. Your business cannot rely on selling a single product or the revenue from your first lot of customers. Instead, you need to be constantly pioneering new products and services and finding your target buyers for them. And what does that involve? That’s right, keeping your customers satisfied!
A company’s existing customers account for 65 percent of its revenue. Since acquiring new customers requires the whole sales process to be followed, notwithstanding the acquisition costs and resources deployed, customer retention is the new hot take for organizations.
What is customer retention?
Customer retention, simply put, is keeping your customers happy enough to keep using your services or buying your products. Businesses do not like losing customers; retaining customers is their most significant sales boost strategy. In addition, new customers often rely on the reviews and testimonials of previous customers, and repeat sales are a fantastic way to establish your brand’s credibility.
(Image source: https://www.newbreedrevenue.com/blog/customer-retention-rate)
Customer retention is allocating resources to your existing customers to keep them interested in your services and products. It is a continuous mechanism to understand their pain points, take feedback on what works well for your products and what does not, and take action based on the data received. It ensures that your clients and customers do not move away to one of your competitors or pause any further transactions with your business.
Let’s dig deeper into why customer retention rate is one of the most sought-after metrics in recent times.
The importance of customer retention
Customer retention is crucial to improve regardless of the size and nature of your business. It builds your brand integrity and business without leveraging too many of your resources like customer acquisitions. Let’s look at some of the most significant advantages of focusing on customer retention.
Return on Investment
Doesn’t it make perfect sense to retain existing customers if it provides a more significant boost to your business with fewer resources? According to studies, a 5 percent increase in customer retention leads to a 25 percent increase in company revenue.
Using Auryc’s Smart Path Analysis, you can always bring forth actionable insights based on customer data. Smart path analysis provides you with the path your customer took to arrive at your business and how they left your website. As a result, your business can identify how to remove the roadblocks for your existing customers and persuade them to try your new offerings.
Keeping your current customers happy also keeps them invested in your business. You earn their loyalty with every new product you launch and the service you provide.
Returning customers have no acquisition costs and always provide you with a higher profit margin.
Happy customers are the ultimate gold mine in revenue and brand value. Using Smart Funnels to get measurable customer data, you can make their journey more accessible and streamlined around your website. Whether it is a simple page load issue that is hampering their experience or if you are losing customers right at the checkout page, you can tackle all these problems and earn the trust of your customer by delivering a quality product.
The power of word of mouth
If you retain your customers, the bonus of good word of mouth and referrals comes along. In addition, the new leads are almost free of charge, and your business gains positive traction in the market.
Now, how do you ensure word of mouth is good? Your product may be fantastic, but how happy is your customer? Auryc’s Voice of Customer feature can help you by providing you with feasible customer feedback, not just the pre-filled generic content those feedback forms get you.
The power of customer retention can be attributed to the fact that acquiring a customer is six times more expensive than retaining an existing one. Therefore, recognizing how your products cater to your customer needs and the features responsible for the most conversions will robustly affect your revenue.
Customer retention strategies
Customer retention is not a linear path. However, you can also rely on some solid strategies that can show you the right way to approach this. Define your sales goal.
The first thing to do is define your sales goals. Next, measure your current customer retention rate, your customer demographics, and the feedback channels you already have. That should help you set a realistic goal of the expected customer retention rate and an essential roadmap of when to get there.
Customer journey mapping
Customer journey mapping is collecting and analyzing data about your customer interactions to improve their experience. This is an essential facet of customer retention since it helps identify the pain points of existing customers and sets up a feedback route.
Communicate with customers
Communication is the key to understanding what makes your customers happy and what does not. Engage with your customers through every channel, and you can deduce what clicks for them. Also, the more your customers engage with your content, the more they know your business's value. You can always check how customers engage with your website using the Session Replay feature and polish off any shortcomings by prioritizing and reforming the parts and components of your business that cause the most trouble. This feature lets you communicate with the customer and their issues with your product.
Create a marketing strategy
A customer relationship team or manager is an easy way to maintain a strong relationship with your clients. They can help create personalized offers, content, and offerings for their customers, which results in positive customer responses in the long run.
Customer loyalty program
Loyalty programs such as occasional gifts, discounts on new products, and loyalty bonuses are the ultimate cherry on top of your customer retention programs. This way, you can hold their attention and make them happy with a minimal expenditure over the years.
Data-backed customer retention
Your company’s relationship with your customer is one you would safeguard with all your available resources. It is undoubtedly impressive that we have some solid customer retention strategies to employ immediately and see results. It may be a pain to set those up, but eventually, they ensure a smooth business transition for all your customers. Customer retention is of paramount importance to the sales of a business, and organizations need to leave no stone unturned to improve their CRRs.
Learn more about creating a streamlined customer journey and sales strategy that would increase your content retention rates significantly.