Why every company needs a customer retention strategy10.02.2020
Keeping hold of customers is as important as adding new ones, and a retention marketing strategy will also determine how a business is perceived, according to Saunders who discusses ways to apply a marketing retention mindset to your company…
It is a long-held belief that a five per cent increase in customer retention can improve company profitability by as much as 55 per cent. And it is a fact that creating and maintaining customer engagement should be the definitive strategy for preventing customers going AWOL. Marketing is the key weapon in any retention armoury.
Why do customers want to leave?
There are many reasons why customers may want to move, but the good news is that retention marketing can help prevent losses across the board. Start with a short brainstorm exercise to see why you think customers might want to jump ship. You may conclude that a poorly handled or unresolved service matter is motive enough. A personality issue or negative PR about your business may deter certain customers from being loyal. The lack of a CSR strategy might not go down well with some clients. Market changes, regulatory shifts, new technology and cost may also come into play. Meanwhile, a competitor may offer a compelling alternative.
How can marketing help?
Prevention is better than a cure, so the answer is ‘engagement’. Yes, creating the lead and supporting the sale are marketing staples, but the in-life care of customers is crucial if you want to avoid them being spoilt for choice by your potential ‘reasons to leave’ list. In the consumer world loyalty schemes play a key role, but in the B2B space the ongoing addition of real value to the relationship is more important. So keep communicating, use the right channels, and personalise these interactions as far as possible.
Rules of engagement
Share relevant information and insights with customers. Inform and surprise them, understand their business, ask about their issues – and listen. Make yourself easy to reach using the communications channels that your customers use. Why not use some free software to conduct a short survey? Everyone likes to release their inner Trip Advisor, so you might learn something that can stop you losing that one customer.
Make your positive presence felt
Your website and social media activities are your shop window, so make sure they are enticingly merchandised and welcoming. Customers can still behave like prospects and will look next door if they don’t like what they see, or can’t find what they are looking for.
Use marketing to improve customer interactions
Marketing’s ability to simplify and optimise customer facing processes can also have a significant positive impact on retention. This is not just about deploying leading edge design and impressive language, it is about defining all the touch points you have with your customers and tapping into marketing peoples’ ability to think ‘customer first’. If every touch point is meaningful and memorable, customers are less likely to stray.
Delving into your customer data
A Salesforce level CRM may not be commercially sensible for everyone, but whatever system you use, interrogating your data to hunt for opportunities and identify customers who may have been relatively neglected can improve your retention overnight.
Referrals and retention
If you rely on referrals for some of your new business, you can’t afford to lose your source material. Investing in marketing to increase retention can produce additional benefits from increased advocacy among your customers. Studies regularly endorse the view that working for an organisation that treats its customers well encourages a sense of pride among employees, and a desire to show the business they represent in a shining light.
How to start?
Kick off with at least one change, and because measuring retention by volume and value is relatively straightforward you will quickly see what is working and what needs a rethink. Not everyone has access to marketing resources, so it pays to work with a supportive service provider, and talk to and learn from similar businesses, chat to friends, read other articles – doing nothing is not an option.