7 Effective Customer Retention Strategies That Work
It is no secret that repeat customers spend more money and cost five to 25 times less to retain than it does to obtain new customers. Repeat customers also spend 300 percent more than new customers, are easier to sell to and refer, on average, 50 percent more people than first-time buyers.
In short, repeat customers are crucial to the sustainability of your business. If you aren’t able to retain customers, or if you want to boost customer retention rates, you need to invest in customer retention strategies that actually work.
Stand for Something
People these days are all about “the movement,” and they expect that every person they befriend, individual they work with an entity with which they do business to be all about the movement as well. If your business doesn’t stand for anything, you’ll be hard-pressed to accrue a loyal following.
Find something that you believe in and use your brand to advocate for that something. Some companies strive for environmental friendliness while others send out the message that compassionate treatment of animals is at the top of their list. Though your values and beliefs won’t resonate with everyone, you’ll build loyal customers in those with which they do resonate.
Appeal to the Inner Ego
People want to buy products to which they can relate. This cognitive bias is called “implicit egotism” and is important to keep in mind when devising your marketing strategies. When crafting product descriptions and marketing messages, think about who your ideal client is and then craft a message that speaks to his or her pain points, goals, aspirations and style. Again, you won’t appeal to everyone, but to those whom you do appeal, you’re likely to garner a loyal client for life.
Make Things Easy
If there is one thing that today’s consumers appreciate more than “the movement,” it’s convenience. Uber Eats makes takeout easier than ever before. Online banking makes it possible for individuals to take care of all of their banking needs without ever having to step foot into an actual banking institution. Subscription services such as Hello Fresh, Bark Box, Ipsy and Trunk Club provide individuals with everything they need to make healthy, fresh meals, care for their pets and maintain their appearances.
Make things as convenient as possible for your customers by making your products and services as accessible as possible. The more empowered customers feel, the more likely they’ll be to continue to shop with you.
Create a Divide Between You and Your Competitors
No company has done this as well as Apple has, but it’s still a strategy worth trying. Get bold with your marketing and create messaging that positions you like the more obvious choice over your competitors. Sure, you’re bound to ruffle some feathers, but if feathers didn’t get ruffled, you obviously didn’t hit the right nerve. When done right, this is one of the most effective customer retention ideas, if only because once they choose you, your customers will be apt to fiercely defend their decision to others.
Capitalize on Social Proof
If you have a strong, loyal customer base, turn to them for help. Ask for reviews, encourage them to share feedback on public forums and highlight customer stories on your website. Studies indicate that reviews and positive testimonials are the most effective strategy for getting people to listen and that more than half of consumers trust online reviews above all else. When used correctly, this can work to your advantage and help you build a solid customer base while attracting new customers as well. Use social proof to charm new customers and to encourage existing customers to stick around and spend more.
Use the Before and After Effect
Most people these days are looking for long-term solutions to chronic problems. Whether the problem is something as trivial as having nothing to wear or something as significant as being unable to sit at a desk without feeling pain doesn’t matter—what matters is that the marketing for a product or service is solution-oriented.
For instance, a subscription service such as Birch Box provides the long-term solution to the wardrobe conundrum, and despite the fact that the outfits the company sells are more than most people spend on their wardrobes in a year, the company is successful. Why? Because it provides an ongoing solution to an ongoing problem.
You don’t have to a subscription-based service to do carry out this strategy effectively. You simply need to understand where your ideal customers currently are (how they describe their pain) and where they want to be (how they frame their solution). Show how your product or service can bridge the divide and you’re bound to catch their interest.
Reward Your Loyal Customers
To keep customers coming back, it’s important to frequently reward them for their loyalty. Giving back to your customers makes them feel appreciated, a feeling they will associate with your business.
To get the most out of a customer loyalty program, it’s important to give rewards to your customers will actually use and enjoy. This keeps your business top of mind when they use the product, and makes it more likely they will want to earn more rewards, which will mean they buy from you instead of your competitors.
If you are ready to implement a customer loyalty program but don’t know where to begin, Rymax can help. Rymax helps companies develop customer loyalty programs customized to their target audience. Contact us today to get started!