The world has transformed over the years and has adopted and adapted to digitization. Being a part of the digital world means that businesses can cater to a global clientele from any corner of the world. There are many advantages to it, but with it comes stiff competition, where the competition is not only limited to neighboring local businesses anymore. It crosses geographies and puts businesses on a global scale to be compared with other brands worldwide. So the question arises; ‘How to be a step ahead in the game?
Customers are the very core of a business enabling success and growth. Customer acquisition is quite an expensive process which includes different mediums of marketing and advertising. But it is evident that customer churn rates are quite high. And acquisition of new customers can be heavy on the pocket. Therefore the second question arises; ‘What can be done to minimize the churn rates?’ The answer is simple; Customer Retention.
A survey done by Harvard Business Review Analytic Services, revealed that only 22% of companies have access to real-time metrics that impact customer experience. That means that a staggering 80% of companies are putting their customer loyalty at risk. As per the report by Deloitte in 2021, the customer churn rate is as high as 30% in some global markets.
Acquisition of a new customer can cost five times more than retaining an existing customer. U.S. companies lose around $136.8 billion every year due to avoidable customer churning. American Express found out that about 33% of customers will consider switching companies after just one instance of poor customer service.
Customer retention by definition is the process of engaging existing customers to continue buying products or services from a business. It’s different from customer acquisition or lead generation as these customers have already been converted at least once and therefore it is not required to spend extra on advertising for the same.
The best customer retention tactics enable a business to form lasting relationships with the customers who become loyal to the brand or business. They’ll even spread the good word within their own circles of influence, which can turn them into brand ambassadors.
It is often seen that after selling a product or service, businesses don’t quite understand what to do next. The goal should not end with just customers buying the products or services once, but the goal should be for them to keep coming back and continue their purchases even in the future. It shouldn’t be a one-time thing.That’s when a business needs to build and implement customer retention strategies.
Strategize to Increase Customer Retention
Now that it is understood how important customer retention is for any business, how does one plan to achieve it?
Here are some important points of customer retention strategies that can be used by businesses to woo their customers and bring them back for more.
1. Setting goals
Before strategizing, a proper goal is required. First, step is to calculate the current customer retention rate. If the current customer retention rate is 10 percent, setting a goal of 50-60 percent isn’t practical or reasonable. The goal has to be one that can be feasibly hit, by considering the size of the customer base as well as the type of product or service the business offers. Some products and services can be tailor-made for customer retention.
2. Mapping the journey
The route from prospect or lead to being a customer isn’t always a straight line. In fact, it’s more likely to take lots of unexpected turns along the way. So it’s really important to understand what the customer wants. By understanding the customer journey, it’s easier to figure out how the customers make their decisions. Businesses can optimize each stage and improve customer retention in the process.
3. Engaging customers
It’s very easy to forget a brand nowadays since there are so many options. Hence the customer relationship deteriorates. The businesses need to continuously communicate with their customers and engage them through customer support experience. Only then a business can retain its already existing customers and acquire new ones. Building a long lasting relationship not also boosts sales but also builds credibility and awareness for a business.
4. Understanding issues
Even if a business has the most amazing product or service in the world, it’ll face issues and challenges on the way and it’ll cause a lot of problems if the business doesn’t know how to resolve them. Understanding the different issues faced by diverse customers is really important. The business has to provide tailored solutions to all and that will help in customer retention as the customers will feel heard and valued. In a survey done by Salesforce in 2020, 90% of customers said how companies react in a crisis shows their trustworthiness.
6. Getting feedbacks
Getting feedback from customers serves two distinct purposes: It makes the customers feel good as they can voice out their opinions. It provides businesses to gain insight into how your customers think and feel about their services and products. It's also essential for measuring customer satisfaction. Also, customer feedback is a reliable source for information to other potential customers.
Gaining new customers is a sign of business growth but losing customers is rather expensive! The existing customers potentially increase business profits, as they are more likely to buy from the same business than other prospects or leads, given the brand has established a relationship and built trust along the way. Existing customers are 50% more likely to purchase new products and 31% are more likely to spend more according to Invesp, 2020.
And in order to make that happen, Zykrr is here. At Zykrr’s, the Customer Experience teams’ motive is always growth, minimizing churn rates, creating lifetime valued customer experience and establishing brand awareness. Retention, advocacy, digital transformation and loyalty, all require a transparent and simplified feedback mechanism with visual reporting capabilities. And therefore Zykrr offers incredibly simple, beautiful & innovative feedback solutions at fingertips, from Intelligent Diagnostic Tools, Quick Valuable Insights to Robust Technology.
Zykrr’s experience and expertise in the field helps in retaining more customers and growing business profits. Collaborating with Zykrr always yields great success.