The key to retention is engagement, be it during normal times or amidst unprecedented circumstances, such as a pandemic. The same holds true according to Harvard Business School’s claim that an increase in customer retention by merely 5% increases profits by 25-95%. The statistics may vary, but the analysis that customer retention leads to increase in profits remains the same. During these uncertain times, when nationwide lockdowns have negatively impacted many economies around the globe, the key to supporting businesses is through customer retention. The downturn in the economy has further restricted the way companies spend. As known to most, acquiring new customers is about 5 times more expensive than retaining existing ones (Alan E. Webber, “B2B Customer Experience Priorities In An Economic Downturn: Key Customer Usability Initiatives In A Soft Economy,” Forrester Research, February 19, 2008). There is a greater need to retain the current customer base, in order to increase revenue through upsell and cross-sell.
Let’s dive into the essentials of customer retention:
1. Focus on customer experience
With the entire world cooped up at home, digital transformation ceased to remain an option only to be implemented by a handful of companies. As in-person interactions gave way to zoom meetings, and e-learning and e-commerce became the need of the hour, delivering exceptional customer experiences became all the more relevant and important, especially from a retention perspective.
Delivering great customer experiences enables customers to vouch for your business and they are more likely to give referrals within their peers and the community at large.
2. Implement customer loyalty programs
This is the most effective way to encourage customers to stay with your company for long-term business. Customer loyalty programs involve offering customers coupons, free trials, gift cards, rewards, and so on to maximize the value they derive from your product/services. This not only adds value to your business, but also improves product adoption and ultimately profitability.
3. Employee Success
Companies generally invest hefty amounts to implement customer loyalty and reward programs. However, they fail to leverage one of their most powerful assets – their employees. Customer Success is a direct result of employee success. Equip your team with the necessary tools and support, acknowledge their efforts, and above all, do not forget that they are going through a pandemic as well – take care of your employees, both financially and morally.
4. Virtual Presence
Digital presence is the new norm. Line up webinars, podcasts, virtual events, online tutorials, live-streaming video, etc. Increase your brand visibility and social media presence. The aim is to stay connected and provide customers with informational content that can help them extract value from your product/service. Make sure your content is informative, as well as relevant and self-explanatory.
5. Send out surveys to gather customer feedback
The best way to correct a mistake is to learn from it. When working towards retaining customers, Voice of the Customer (VoC), CSAT survey, NPS survey and proactive engagement with customers helps gather valuable customer insights. Tuning customer data into actionable insights helps companies identify at-risk customers, improve team productivity and increase customer happiness.
Retaining customers is a team sport
At its very core, Customer Success platforms try to bring in greater centrality, in terms of data consolidation, customer health, and customer retention. From the time a customer gets onboarded, all the way through the length of their journey, establish regular customer touchpoints, involving all key stakeholders in the process. Ultimately, the best retention strategy is a satisfied customer, so dedicate your teams to serve customers better during these troubling times.