Customer retention is King

October 6, 2016

Customer retention is King

In our last blog, it’s all in the follow up, we shared with you some best practices and advice in relation to following up those hard earned leads to ensure the maximum possible customer conversion rate.

So now you have new customers, well done!  But what should you do to ensure you keep them?  In this blog we will explore why Customer retention is “king” and why it’s important to every business.

So now you have new customers, well done!  But what should you do to ensure you keep them?  In this blog we will explore why Customer retention is “king” and why it’s important to every business.Customer_retention.jpg

Essentially the better your customer retention, the more profitable your business will be.  Think about it… you don’t want to spend all your time “filling your bucket” from the top if it has a hole at the bottom.

Below are a few interesting statistics about why customer retention is so important to your business:

  • It can cost a business up to 5x as much to get a new customer vs. keeping an old one
  • 68% of customers leave a supplier because they perceive that it is indifferent to them
  • A 2% increase in customer retention has the same effect as decreasing costs by 10%
  • 68% of customers leave because of poor customer service
  • A 5% increase in customer retention increases profits up to 125%
  • 41% of customers expect an email response within 6 hours, but only 36% of companies respond that quickly, and 14% never respond

So what can you do to improve your retention rate?

Below are a few hints and tips that have helped me over the years:

  • Ensure that your customer service is not only consistent across all channels and platforms but that it is also outstanding.
  • Ask for feedback as many ways as possible – there are lots of different mediums such as social media, surveys or even just asking at the end of a call.
  • Personalisation is key – any communication that isn’t verbal or is just an automated response, may not speak to an individual. Make it personal to the client you are dealing with, so they feel valued.
  • Deploy a Retention Marketing Strategy – This will move your customer towards becoming an advocate for your business.
  • Thank long standing clients – something as simple as a quick thank you goes a long way.
  • Monitor your clients – this is probably the most important. If you aren’t monitoring your existing clients how do you expect to identify why, when or how you lost them.

There are many approaches to customer retention, and the best choice for your company depends on your business’s goals, size, products, services, customer base and local cultural norms. Successful companies use a combination of company-wide retention strategies and retention techniques.  Most importantly the businesses who are the best at customer retention are those who train and maintain their staff’s customer service skills.