Customer retention strategies
Even small improvements in your customer retention rates can go a long way to improving your profits and keeping your customer base happy.
Smart analytics, segmentation, profiling and monitoring are key components of effective customer retention strategies, but a personal touch and well thought through additions are often the best strategy of all.
As such, examples of customer retention strategies include:
1. Excellent customer service
Customer service is key, as it increases loyalty, increases the amount of money each customer is likely to spend, and how often a customer buys from you.
It can also generate more positive reviews, earn recommendations and generally improve customer retention levels at all stages of the customer’s journey.
2. Financing options
Financing can help with your client retention strategy, as it gives customers the flexibility of being able to spread payments out.
It benefits those that would prefer to spread the costs over time, or if a customer’s financial circumstances change, they can choose a better option for them. Plus, it helps you avoid losing customers to competitors that do offer this as an option.
3. A generous returns policy
This has long been a staple of both online sales and brick-and-mortar stores. A concise, clear and generous returns policy gives a feeling of trust to the customer.
It also provides an extra guarantee, and marketing tool, if your policy is particularly good. It adds an additional trust factor, as in an unspoken way, retailers are backing up the quality of their products, whilst the customer feels safe in the knowledge they can get their money back if unsatisfied.
4. Incremental bonus rewards for continued loyalty
Known for helping customers feel like an important part of your brand, bonus reward schemes can do wonders for customer retention.
Loyalty cards, stamp cards, and more recently, smartphone apps scanned directly to the merchant or used online, have been proven to increase the frequency of purchases, product awareness and increase the reach of your brand (such as encouraging your customers’ friends to sign up).
5. Retain your customers by using a multi-channel approach
Previous research studies in marketing, have shown the importance of a multi-channel approach for customer retention.
Categorising all younger age groups as susceptible to online-only marketing is a generalisation, and recent research often suggests the opposite.
Benefits of customer retention
Customer retention strategies are also related to reducing shopping cart abandonment, and being able to entice your customers back to complete their purchases and use your store again.
Even small improvements in your client retention strategy can go a long way to increasing profits:
Benefits of customer retention include:
• Customers are more likely to buy a new product or service from you
• You can push boundaries and trial new approaches to marketing with your loyal customers
• Referrals are likely to increase, with your existing customers recommending you
• Loyal customers are more likely to provide you with feedback
• It’s much cheaper to keep a well-established customer than to attract a new one
• Over time, your customers will spend more over time with your brand
By ensuring your customers want to stick with you, you could drastically improve your profits. An increase in customer retention by just 5% can increase profits by 25 to 95%.
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