Customer Retention Strategies

Many businesses are focused on getting new customers that they fail to retain the ones that they just got! So, understand customer retention, its benefits & some effective customer retention strategies that will help you to retain more customers. 

What is Customer Retention All About?

As the name aptly implies, customer retention is about giving your customer a reason to stick to your brand. But, this can be quite difficult. Why?

2020 is about to end and we have been witnessing a steady rise in the usage of smartphones. In addition to that easy access to the internet (45/5G/Wi-Fi) coupled with a vast range of choices i.e. Mobile Apps, Mobile Websites, Ecommerce Websites and other digital shopping experiences have empowered customers to switch from brand to brand in mere seconds.

Now you might say that in such cut-throat competition, how can my business survive? Well, there are a few wonderful customer retention strategies that will help you to easily make your customers stick to your brand. 

But before we get into those strategies, let’s quickly understand a couple of aspects that companies fail to understand.

Getting New Customers Vs Retaining Existing Customers

You might have put in all the hard work to get a good number of customers to download, install & use your mobile application. Most companies do the same! 

To put this into perspective, around 44% of companies (be it online or offline businesses) focus on acquiring more customers. Only 18% of businesses make it a point to retain the customers that they have acquired. Almost 40% of businesses focus on both the aspects i.e. customer acquisition & retention.

Some studies & research have revealed that customer retention is much cheaper than customer acquisition.  While some reports report customer retention costs to be 5x less, others claim it to be a whopping 25x less.

But an interesting fact is that more companies are focused on getting new customers rather than retaining them. The truth is that small & large companies need both to ensure business continuity.

Why is Customer Retention Important?

Here is the Golden Fact – Your business doesn’t run due to an influx of new customers. It is the existing customers that contribute to your business profits.

There is no doubt that your business needs new customers to increase profits & revenue. But when it comes to business continuity, it is your loyal customer base that powers your business.

Here’s an interesting fact:

A study has revealed that once a customer purchases a product or avails a service from you, there is a 25% chance that they will come back again to avail your services again. These numbers increase after the next transaction by a whopping 45%! After making 3 transactions, they are more than 54% likely to avail your service.

Some of the benefits of customer retention are:

  1. Excellent conversion rates
  2. Less Marketing 
  3. Better Profits
  4. Reduced Costs

Now, you might think that merely getting customers to avail your service once will do the trick. Most of the time, it doesn’t. In this digital era, almost every business has an online presence. A simple search in the google search engine or play store will bring up a list of businesses from where customers can avail a service. Each business has its own set of services and pricing. 

That is why you need some good customer retention tactics that will help you to effectively retain customers for your business. Let’s quickly look into those strategies.

How to Improve Customer Retention?

You can only form & leverage effective customer retention strategies if you have clarity about your business goals i.e. the type of services you offer, the quality of those services, personalization & more.

Here are 4 strategies that will help you to improve customer retention:

  1. Special Deals & discounts

You might’ve noticed some amazing deals & discounts in Amazon, Walmart, BestBuy & other eCommerce sites. These big companies are showing us an important customer retention strategy i.e. to generate excitement in your customer base with special discounts and one-time deals. This will nudge them to stay with your business in anticipation of future deals & cashback.

You can also add a new customer discount wherein a new user who wants to avail your service for the first time will get a 10% discount or maybe more. As we have seen earlier, once a customer experiences your services, he/she will want more of it!

  1. Offer Excellent Customer Service

This is a rule that needs to be followed by every business out there. Customers expect good customer service. But many times, a business fails to deliver that. Your view of customer service might not be the same as how a customer views it.

Here’s a mind-boggling fact to back up the above line: 

Almost 75% of businesses feel that they are customer-centric. But customers say that only 30% of companies offer customer-centric services. This is a huge gap which needs to be filled! 

A leading report has stated that almost 8 out of 10 customers don’t like the services offered by a particular business. They get so frustrated that they are willing to pay more just to have a better customer experience. Your business can do just that by offering excellent customer service and getting more customers to stick to your brand.

  1. Get to know your Customers

Nowadays, almost every business is leveraging a mobile application to help customers avail their services. But, that’s not all a mobile app can do!

You can easily get insights into customer behavior i.e. their preferences, their expectations, surveys, reviews, view time of a particular service page and more. This crucial data can then be leveraged to not only meet customer expectations but even exceed them.

You can easily show them relevant services or bundled packages as they browse your mobile app to search for a service. You can leverage mobile deep linking (push notifications & smart banner) to easily nudge your customers to avail your services.

Personalized user experience will prompt your customers to stay loyal to your business which results in improved customer retention rates.

  1. Automate Customer Re-Engagement

Your personalized mobile application can do more than just giving you customer data. It can also help you by sending out personalized notifications that prompt your customers to come back to your business.

Manually checking each customer data can be challenging. Engaging with each one of them can become tiresome. Instead, you can schedule push notifications & email reminders that will periodically notify your customers about their time away from the mobile app.

Effectively re-engage them with eye-catchy notifications & engaging emails and improve customer retention rates for your business.

These are 4 customer retention strategies that will help you to gain a loyal customer base for your business.

Planning to build a Booking application for your business? Then you must check out Reservifi. It is an amazing No Code Platform that helps you to build an easy-to-use booking app within minutes.

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