Customer retention is one of the most critical factors to building a sustainable and profitable business. As customer acquisition complexity and costs grow, it’s no surprise that more businesses are deciding to invest time and resources into keeping existing customers instead.
In fact, research suggests that a majority of a company’s future revenue will come from existing customers. A study conducted by Bain and Co. asserts that a 5 percent increase in customer retention can yield as much as a 75 percent increase in profitability. You can, therefore, assume that it serves your best interests to retain current customers.
So here’s an inside look at sound strategies every small business can use to retain more customers.
1. Think reciprocity.
Every customer expects to be treated like a human being so, when they have questions or concerns, listen emphatically and treat customers with respect. By behaving in a friendly, respectful and empathetic manner, you create a lasting feeling of goodwill that can result in customer loyalty. When thinking about customer service, think about reciprocity.
For instance, studies have shown that if restaurant wait staff deliver candy with the check they receive better tips than those who don’t do anything special. Similarly, when you promptly return phone calls, respond to emails, and have an overall policy that prioritizes prompt communication, it is something that customers never forget.
2. Consider relationships before transactions.
Don’t make the mistake of letting the relationship between your company and a hard-earned customers end right after the first sale. Instead, create a process to thank them for their business, tools that make it easy for them to follow-up and invite them to stay connected through your company blog and social media platforms.
Reward their trust by providing incentives and special offers that will encourage loyalty. You will notice that many customers respond to relationship-building efforts by rewarding you with repeat business. If you discover a dissatisfied customer, do your best to make amends.
When you demonstrate you care about your customers and value them without condition, you will naturally build lasting relationships that sustain and grow your business.
3. Provide valuable content.
Many businesses have discovered the truth of a statement made famous by Microsoft co-founder Bill Gates. Gates said, “Content is King – especially when it comes to adding value to customers’ lives.” Content creation allows businesses to regularly supply customers with actionable, engaging, and entertaining information that can enrich their lives.
Some of the content you produce can subtly promote your company, too. For example, you can tell the story of your brand by creating a buyer persona to be your lead character. Or, you can indirectly promote your goods and services by providing educational information that helps people get the most benefit from their purchases.
To avoid bland content and cater to different users’ needs, make sure provide content in a variety of formats, such as articles, images, videos, whitepapers and more.
4. Keep customers engaged.
Customer engagement is an indispensable component of every customer retention strategy. And with the emergence of new online channels there are endless possibilities. Also, take advantage of customer service opportunities that arise from your social media presence.
Regardless of whether people leave complaints, express appreciation, or report a problem on your company’s support page, you should always respond in a prompt and professional way. You can leverage the openness of social media to let others see how well you treat your customers. By doing so, you encourage people to share their experiences with their networks, which increases your brand awareness.
5. Go the extra mile.
Always deliver more than you promise. When you make a habit of surprising your customers with more value, a personal touch, or a helping hand, you have a powerful customer retention strategy. Simple things, such as sending emails or thank you notes will remind clients that your company values and appreciates them.
As you make a reasonable effort to bring back past customers, don’t forget to reward new customers as well. Let them know their loyalty pays off. Offer unexpected gifts for specific milestones, special discounts, or a chance to preview new products and services.
This article has been edited and condensed.
Taylor Moore is a freelance copywriter with a passion for small business and retail marketing. She writes about content marketing, conversion optimization, branding and customer service. Connect with @taylormtweets on Twitter.