The main focus for any business, especially when it’s attempting to grow, is often to win over new customers; however, there is success also to be found in a strong customer retention strategy and creating loyal customers.
What is customer retention? This is a measure of how well a company is keeping its customers over time and gaining repeat business. Building a loyal customer base should be the foundation for most businesses, with 25% – 40% of the total revenue of most stable businesses coming from repeat customers, and the good news is that getting customers to make a repeat purchase is easier than winning over new buyers as they already know who you are and should be able to trust you.
To help you get started, we have compiled 5 killer tips which should up your customer retention rate in no time.
The Power of Brand Storytelling
The internet has provided an amazing platform for businesses to reach a large customer base, but it also brings a lot of tough competition. It’s for this reason that winning over potential customers and creating a loyal consumer base takes more than just a website and a logo. Today it is important to have a story behind your brand that tells the customer who you are, why you got started, what you stand for and what your mission is. Storytelling has become an important part of marketing and allows the customer to relate to your business and understand what you are about. Customers don’t purchase from you so you can make money, so you need to give them a reason to purchase and purchase again and again. One example of this is could be that your business set up to offer entirely vegan snacks, with everything from the snacks to the packaging being vegan-friendly; this kind of story might not only win over a consumer, but get them coming back to you and recommending you to others.
Be Customer Obsessed
It is by no accident that research by the Institute for Customer Service puts Amazon at the top of the UK’s best customer service list. The CEO of Amazon, Jeff Bezos, is famous for saying “We’re not competitor obsessed, we’re customer obsessed.” The internet not only provides a great platform for businesses, but it also provides a great platform for angry consumers to vent their frustrations and make those frustrations known to a large audience. Keeping your customers happy is a prerequisite for any business and in doing so, you can help avoid your business being publicly named and shamed. A good place to begin when making your business customer focused is mapping the customer journey. By looking at the customer experience you can see what needs to be improved and what’s working. Making sure that every team in your business is also customer focused is important, ensuring that no part of the business lets the consumer down. One way Amazon does this is by ensuring that all its managers spend at least two days working in the customer call centre.
Social media, with Facebook, Instagram and Twitter being the most prominent, may or may not seem relevant to your business, but they are a great way to build a potential customer base and create brand loyalty. People who are interested in your brand, and your story, are likely to follow you on social media; this allows you to better understand your customer as most platforms allow you to look at follower insights, giving you a better understanding of the age range, like/dislikes and gender of your customer demographic. Social media also allows your business to keep your customers and followers up-to-date with new offers, new products and innovations and your brand story. It is also a great place for your customers to get in contact with your business, allowing you to solve issues quickly and gain feedback on what is and isn’t working.
The Loyalty Program
Creating a rewards or point-based system with your business is a great way to encourage customers to spend more and keep coming back. When creating a loyalty program, it is important to make sure it is offering value to the customer and doesn’t have goals that are unrealistic and uninspiring such as “Spend £2000 on your first purchase and get a 5% discount code”. You can use your loyalty program to not only reward customers for making a purchase, but for creating an account or even tweeting about your business. Doing this not only encourages the customer to buy from your store, but to recommend it to others. Rewards in a loyalty program can also come in a variety of forms such as cashback, discount codes and free shipping, but you can also tie it in with your brand story and offer rewards such as charitable donations and product gifting to those in need. Make sure your customers are aware of your loyalty program by giving it an interesting name and promoting is across your email list, your website and social media platforms.
It’s All in the Packaging
You may have been told repeatedly not to judge a book by its cover, but today more than ever the packaging your product comes in is incredibly important. If your business is entirely based online then packaging is even more important as it will be the only point of contact with your company for most customers. The more creative and interesting your packaging, the more memorable your business will be and the more likely customers will be to share your brand, all helping your business grow and retain customers. There are few things to consider when it comes to your packaging such as your demographic – who is your business selling to and what designs will appeal to them – personalisation – will your packaging be custom-made for each customer – and eco-friendly options – are you targeting environmentally conscious consumers? Your packaging can be a part of your brand story, showcasing what you are about and your purpose.
Focusing your entire business strategy on growing your customer base and winning new customers will mean you miss out on a potentially large chunk of revenue in the form of repeat business. By incorporating these top tips into your business model will not only help you build your brand and an audience of loyal consumers, but, crucially, generate a surge in profits.