It has been estimated that it costs as much as five times more to acquire a new customer as it does to retain an existing customer. For that reason, one of the best ways to increase the profitability of your company is to improve your customer retention. The good news is, many of the best methods of retaining customers can also help you attract new customers. Consider including these eight tips in your customer retention plan for 2020.
1. Analyze Your Data
One of the best places to start your retention plan is by analyzing your customer data for key metrics that may indicate a customer is a risk for leaving. Once you have identified these metrics, you’ll want to generate daily reports that identify at-risk customers, so you can develop and implement a plan to focus on retaining these customers and meeting your customer service goals.
2. Invest in Customer Success
Customer success is a business methodology that focuses on ensuring customers get what they want out of your products and services. To achieve this goal, you’ll want to invest in hiring and training agents who can effectively identify the needs of your customers and ensure that your products and services are meeting those needs.
3. Make Sure You Are Utilizing All Channels
Today’s customers expect to be able to reach you on their preferred channel. Simply providing a phone number and web contact form is no longer enough. You need to be monitoring all the popular social media channels, either with live agents or automated tools and responding to customers on those channels. It may be helpful to use automated tools to scan social media networks for mention of your company or your products so that you can respond to those customers and build brand awareness and trust.
4. Incentivize Customers to Advocate for You
Not only is word of mouth advertising one of the best ways to attract new customers, but customers who recommend your products to other customers are more likely to stay customers than those who do not. Offering loyalty rewards and other incentives for recommendations can help you gain customers and keep the customers you have.
5. Incorporate Artificial Intelligence
Some customers prefer self-serve options, rather than interacting with your customer support staff. Additionally, some customers may have an issue they need to be resolved outside of your normal customer support hours. For these customers, artificial intelligence can be a big asset. Figure out what sorts of questions your customers may like to have self-serve help available for and use AI to develop automated communication channels, such as chatbots, to address those questions.
6. Ask Customers Why They Left
One of the best sources of information on why customers leave is customers who have already left. Consider contacting former customers by telephone, e-mail or postal mail and ask them what caused them to leave and what you could have done differently to convince them to stay. You may need to offer an incentive to encourage your former customers to respond to your questions.
7. Tell Customers What You Care About
Customers increasingly want to support companies that share their values. Making sure your company does a good job of communicating your values and the causes you support can increase customer loyalty. Consider sponsoring events and donating to charitable causes that align with your company values.
8. Make Changes Based on Customer Feedback
Obtaining feedback from your customers and former customers is only valuable if you incorporate that feedback into your product development cycle. Incorporating customer feedback can help you attract and retain customers and when your customers see that you act on their feedback, they’ll be more likely to provide feedback to you in the future.
Money spent on continually attracting new customers to replace lost customers can really eat into your profits. Investing in processes and technology that increase retention can reduce customer acquisition costs and net you some new customers.