7 Essential Customer Retention Strategies For Brands Big and Small
For your business to succeed, you need a plan that works to bring in new customers and also keeps them coming back for more. You need a customer retention strategy.
What Is a Customer Retention Strategy?
A customer retention strategy is a plan to get existing customers to return to your business. It focuses on reducing customer churn and growing a loyal customer base by building trust and providing a positive customer experience.
A customer retention strategy increases customer frequency which ultimately increases customer lifetime value and generates more revenue and better profits.
Why Is a Customer Retention Strategy Important?
A customer retention strategy is important because it is easier and costs less to bring back an existing customer. They are also more likely to spend more than new customers. The more times you can get a customer to return to your business, the better it is for your revenue and profit margins.
While your marketing plans should focus on brand awareness, lead generation, and acquiring new customers, you should also prioritize customer retention if you want to achieve lasting success.
7 Important Customer Retention Strategies
Use these customer retention strategies to ensure that each new customer you win will continue to revisit your business over and over.
#1) Collect customer data.
The key to customer retention is customer data. If you want to stay top-of-mind with customers, you need to be able to stay in touch with them. When you collect customer contact information, it is much easier to reach customers after they’ve done business with you.
If you want to know how to best approach customers, you need to know what they want and need. You need to track their purchasing behaviors to identify what products and services they are likely to be interested in. Customer data will be instrumental in creating customer retention strategies. So start by setting up a customer relationship management system and launching strategies for getting customers to join your list.
Recommended: Why It's Important to Own Your Business Data & How to Start Collecting It
#2) Personalize promotions.
When you know what your customers like, want, and need, it will be easier to bring them back to your business. Use the data you collect to learn about your customers and identify the products and services they are most interested in.
Use marketing automation to create personalized remarketing programs that promote items related to customer interests. For example, if you operate a spa and identify that a customer came in for a massage, send them a coupon for $10 off their next massage appointment to get them to come back again.
#3) Reward loyal customers.
When your data shows that a customer is loyal to your business and regularly visiting and purchasing, thank and reward them. Set up a traditional customer loyalty program with a gamification element that makes customers want to visit again. For example, assign points to each visit or purchase, and award prizes when customers cross a specific threshold.
Also, consider how you can exceed customer expectations by providing loyal customers with a reward they weren't expecting. Send a personalized thank-you note or a free product by mail. Make the experience so great that the customer revisits your business and also shares the experience online, giving you an organic boost of social proof and visibility.
#4) Use content to stay top-of-mind with customers.
Even if customers enjoy your offerings and like your brand, it’s likely that they aren’t thinking about you all of the time. To stay in the mind of customers, you need to put out messages that bring you top-of-mind and remind customers to visit you. Publishing regular content is a great way to do that.
Create an editorial calendar that shares value-based content that your audience will find interesting and entertaining. Mix it up with promotions for your brand that remind customers to return. Create a plan for consistent publishing through:
- Social media
- Retargeting ads
- Email marketing
- Text marketing
Recommended: What's the ROI of Text Marketing? 3 Examples of Successful Campaigns
#5) Focus on customer experience and service.
It’s going to be next to impossible to get a customer to return to your business if they have a bad experience while they are there. On the other hand, you can get customers to return simply because they love the experience and service they receive at your business.
Prioritize customer experience and customer service. Know that it is directly tied to how successful your customer retention strategy will be.
- Always deliver on what your promise. Never oversell and underdeliver. Always meet the expectations of customers.
- Whenever possible, overdeliver on your promise. Offer a surprise that customers didn’t see coming and think a few steps ahead to ensure that customers feel like they got more than they paid for.
- Listen to customer feedback and pivot based on what you learn. It’s not enough to just read customer reviews on your Facebook page. Create a plan for collecting customer feedback, responding to reviews, and creating changes based on what you learn.
#6) Extend the life of your products or services.
A good customer retention strategy is extending the life of your products and services so customers have a reason to make a repeat purchase. Consider if you can bundle any of your products or services into a subscription, membership, or recurring package.
Make it so easy that customers don’t even have to think about returning to your business. Consider adding a discount that drives customers to extend the life of the product or service. For example, if you have an auto shop, presell the next five oil changes at a discount. Or, if you have a nail salon, create a membership where customers pay annually for a certain amount of appointments.
#7) Have values -- and stick to them.
Now more than ever before, customers expect brands to be more than a business. They expect them to have a voice and opinion about things outside of their day-to-day operations. If you want to build lifelong customers, you need to connect with them on a deeper level. You need to have values that customers feel reflect their own values.
Outline the values that are important to your brand. Post them where customers can see them, and stay true to what you believe in. Consider how Ben & Jerry’s consistently stands up for causes they believe in. Their customers respond and give them lifelong loyalty in return.
Build Better Customer Retention Strategies
Customer retention strategies cannot be an afterthought.
Keeping existing customers should be as big of a priority as attracting new customers. This is especially true if you already have a strong customer base. Spend resources on getting those people to come back rather than fighting (and spending more money) to bring in new customers.
Are you struggling with customer retention? MyArea Network has proven strategies for getting customers to return. See how one of our customer retention strategies led to an average 500% ROI for three local businesses. Get the full story, and see how we helped turn a $600 investment into $4,200 in sales.