No matter how great your products and services are, acquiring new customers is challenging. Business owners must build a brand, identify their target audience, develop credibility within their industry, and cultivate positive relationships that ultimately encourage consumers to purchase. While these practices are commonplace and vital to success, companies can save themselves a lot of time, money, and resources by investing in customer retention.
What is Customer Retention?
Customer retention is essentially a business’s ability to retain existing customers over a given period. Essentially, getting a customer to make a purchase once is fantastic, but getting that same customer to continue to do business with you is even better.
Benefits of Retaining Customers
Why is it ideal for businesses to retain customers? While gaining new business is exciting, here are a few quick reasons why it pays to keep existing customers happy.
- Saves Money – One of the most significant benefits of customer retention is that it saves you money. It takes a lot more marketing dollars to generate new leads. You have to identify their needs and market your products or services to accommodate them. You also have to earn their trust and prove your brand to be credible. Existing customers have already gone through the process, meaning it’s a lot cheaper to encourage them to make another purchase.
- Increased Opportunity for New Sales – Despite the many marketing methods, word of mouth remains one of the most effective strategies. Satisfied customers are more inclined to spread the word to others, increasing your leads and potential sales.
- Positive Brand Image – Last, but certainly not least, retaining customers helps boost your brand’s positive image. As you might imagine, no one will continue to purchase items if the quality or experience was terrible. The more people you have returning for business, the better this reflects on your brand.
Improving Customer Retention Rates
Now that you know what customer retention is and how it best benefits your business let’s look at a few ways to keep them coming back.
- Improve Customer Support – Whether it’s completing a transaction, paying a bill, or troubleshooting a product or service, being there for your customers when they need you most matters. Besides training your employees to provide quality service, investing in technological tools to accommodate consumer needs is also essential. For example, there are patient engagement solutions for medical practices such as mobile applications where patients can review their bills, chat with customer service representatives, and make payments while on the go. Such accommodations keep patients in the know while saving medical practices time and money.
- Customer Loyalty Programs – Rewarding consumers for regularly patronizing your business is an effective customer retention strategy. It not only provides an incentive for them to make another purchase but shows them that you care about their business. Point systems, free merchandise, and exclusive deals on products and services are all trendy options to consider.
- Surveys and Polls – One of the best ways to keep existing customers happy is to show them how much you value their opinion. Surveys and polls give consumers the chance to voice how they feel about a particular product or service. This information can then be used to fine-tune your business to cater to your target audience’s needs and interests.
- Connect on Social Media – Today’s consumers want to know that businesses care about more than just their wallets. They are most loyal to brands that connect, engage, and interact with them regularly. Social media creates just the environment to make this happen. Start connecting with your customers on these platforms. Post photos and relevant content, publicly show gratitude to a loyal customer by thanking them on your timeline, support causes they believe in, and periodically comment and share their posts.
Yes, getting new customers to do business with your brand is essential. Once acquired, however, it is crucial to invest time and resources into keeping them around. By retaining existing customers, you save money, increase your potential for new leads, and improve your brand’s image. Consider using the above-discussed customer retention strategies to increase customer retention rates if you haven’t done so already.