Research shows that it costs a business five to seven times more to acquire a new customer than it does to keep an existing one. Rather than placing all your efforts into acquiring new customers, small businesses should employ strategies to nurture and keep your existing customers. High customer retention will not only attract more customers to your business, but also will create raving fans out of your existing customers, turning them into your external sales force.
Here are some ways to boost customer retention and fuel your business growth.
Provide Excellent Customer Service
This should go without saying but create an experience for your customers. Offer outstanding customer service by being responsive, helpful, and attentive to customer needs. Address any issues promptly and go above and beyond to exceed customer expectations. Get to know your customers and personalize their experience. Use data and customer feedback to tailor your offerings to their preferences and needs. Make them feel special and build their confidence in knowing you will go the extra mile to address every need they have and to provide a positive experience for them.
If you need to invest in a customer service team to achieve this, make the investment; it is worth it. Businesses that stand above their competition excel in providing this simple service to their customers.
Develop a Customer Loyalty Program
Reward your customers for being loyal. The best way to retain clients is through delivering quality service and/or products and excellent customer service, as we’ve mentioned previously. Utilizing a customer loyalty program will reward clients for repeat purchases – enticing them to buy more.
Offer discounts, special offers, or exclusive perks to incentivize customers to keep coming back. You can make this program as simple or complex as you’d like. Retail businesses often use loyalty cards or apps which are stamped with every visit. Once the card is filled up, the customer receives a discount or something free. Some businesses use perks that reward customers with a bigger discount once they reach a specific spending threshold. Use your creativity to tailor a loyalty program suited to your specific business model.
Customer Referral Incentives
Create a referral program that rewards customers for referring new clients to your business. Word-of-mouth marketing can be highly effective and cost-efficient. Businesses that do a great job of taking care of their customers will often see their customers refer them to their friends organically. However, you can build a formal program that rewards your customers with various prizes from cash rewards to service discounts, and even gift cards. Like the loyalty program, use your creativity to reward your customers with things they would like. Consider surveying your customers to get an idea of what rewards stimulate them most.
Follow-Up and Engagement
Stay connected with your customers through email newsletters, social media, and other communication channels. Engage with them regularly and keep them informed about new products, promotions, or industry updates. Most businesses have their outreach targeted only to new customers or prospects; however, you should always be nurturing your existing customers by keeping them engaged as well. In doing so, your business remains top of mind for future service needs or when a friend needs a referral.
Create an online community or forum where customers can interact with each other and your brand. Encourage discussions, provide valuable content, and foster a sense of belonging. Customers love to participate in an environment where their opinion and feedback is valued, and used to shape and grow a business they are vested in.
Monitor your Customer Churn
No matter how good you are at providing great customer service and nurturing your customers, there will be attrition. Keep an eye on customer churn rates (the rate at which customers leave your business). Identify patterns and reasons for churning and take corrective actions accordingly.
If customers are leaving willingly, consider implementing an exit survey to collect data explaining why a customer would exit your business. Assess this data to determine what adjustments need to be made to serve your customers better. Perhaps you need to offer complementary products or upgrades to customers, increasing their lifetime value and enhancing their overall experience. Explore what you need to do to increase value and experience to limit your customer churn. Design customer win-back strategies to address the reasons those customers left the business and manage your customer churn.
Your customers are the lifeline of your business. Therefore, it is essential you invest time and marketing dollars to retain and anchor your business. If you take the time to implement these strategies into your customer marketing, you are well on your way to building a strong small business.
VAAS Professionals has over 20 years’ experience working with small businesses to meet their goals. If you would like to consult with a professional on your customer marketing strategies, one of our consultants would be happy to work with you.