Would you rather make a new friend every day, or keep an existing loyal friend for a lifetime? Unless you’re a Golden Retriever (no shade –– we love those fluffy, fun-loving goofballs), you’ll probably end up picking the ride-or-die #BFFL over a revolving door of besties. For the same reason that one trusted ally is worth five fair weather friends, one repeat customer is far more valuable to a business than several one-off shoppers. Why? Because getting repeat business is harder than ever, and capturing new customers can be up to 25 times more expensive. Customer retention, as it turns out, is the name of the game.
Many businesses, still, take for granted how valuable repeat customers truly are. When this happens, customer retention falls by the wayside and eventually even the most loyal customers may move on to greener pastures. As many of us have likely had to say to our own friends, “this street goes two ways.” Don’t look back thinking about what a good thing you and your most loyal customer(s) had; try these proven customer retention strategies from Real Thread, instead!
What Even is Customer Retention?
Simply put: Customer retention aims to measure customer loyalty over time — which can help predict the overall success of a business. In the old days (read: pre-pandemic) you could retain customers with as little as a long-term nurture email campaign and some first-name recognition. Now, with more customers voting with their dollar and asking businesses “What have you done for me lately?”, businesses will have to work harder to keep loyal customers.
6 Proven Strategies for Retaining Customers
Tailor Your Experience
When consumers began changing their shopping habits following the pandemic, they did so in a way that heavily favored smaller businesses and personalized experiences. Though COVID might be in the rearview, this behavior is here to stay — and businesses of all sizes should be aiming to give their customers a specialty shop experience. In-person, this can come in the form of personalized, attentive customer service with an emphasis on creating “customers for life.” Through ecommerce or omnichannel, a tailored experience may feature live agents and web chat features which ensure that customers are always top of mind.
Treat Negative Experiences Like Opportunities
No matter if you sell sweatshirts, sports cars, or stationery, returns are never fun. They can, however, be a customer retention strategy in disguise. In a survey of 1,400 consumers, 84% said that the returns process can be make or break when it comes to building an ongoing relationship with a business. Though the sting of a potential lost sale can hurt, and unhappy customers can mean flared tempers, working to turn this experience into a positive one can create repeat business and a deeper connection with customers. Plus, listening to unsatisfied shoppers rather than greeting them with disdain can give you valuable insights into your products. Customer retention, consumer behavior, and product insights — all in one interaction.
Start With Your Team
Even before the pandemic, customers looked to employees as brand ambassadors; if they weren’t happy with the product or environment, there’s a good chance customers wouldn’t be either. Now, more than ever, consumers are concerned with the well-being of employees, and a team of satisfied employees can have a huge impact on both your employee retention and customer retention. Make your team your top priority and customer retention will follow.
Leverage Social Proof
Another trend that has arisen post-pandemic is a general distrust of traditional advertising. As many consumers still struggle to find their footing after a particularly precarious couple of years, winning taglines and catchy jingles don’t quite have the same impact. Instead, word-of-mouth and social proof are the new top tools for customer retention. Using existing satisfied customers, you can create testimonials which (literally) speak to your brand. A mind-blowing 97% of shoppers turn to reviews before making a purchase, so there’s some serious power in social proof.
Don’t Treat the Sale Like the End (Because It’s Not)
An existing customer just made another purchase, and their package is being shipped out as we speak. Congratulations! You’ve successfully retained a customer, and your work here is done. Except, not really. Though you have managed to turn a one-time customer into a repeat one, customer retention is about far more than checking this box. Rather, it’s about reassuring them that the decision they made to shop with you (twice!) was the right one. A thoughtful, personalized message after their package has landed (handwritten or email, you choose) can have an impact, as can special discount codes for being a repeat customer. In some ways, the hard work is over; in others, it’s just begun.
Surprise, Delight, and Wow
Inflation is on the rise, and now more than ever businesses must really earn their customer’s dollar. Where you spend your hard-earned money is your choice, and it’s your job as a business owner to ensure that your customer feels that choosing you was the right one. So, how do you do this? For starters, you can go above and beyond throughout every stage of the sales process (effectively using every one of the above tips.) If someone reaches out to you or walks into your store, they’re met immediately with a response or a warm greeting. If they have a concern or complaint, you and your team are addressing it swiftly and with compassion. Effectively, customers should not only leave the experience with 0 reason not to go through the process again — they should be excited to.
You can also wow customers by giving out thoughtful freebies, like super-soft custom t-shirts and other branded swag. Don’t worry, we can help out with those!
Start Building Relationships and Retaining Customers
Customer retention might be more of a challenge than ever before, but today’s business owners also have more tools at their disposal than in years past. Automations, integrated chat features, high-level reporting, and customer relationship management (CRM) software all exist to support businesses and brands of any size — but, as evidenced above, it’s the human element that will make or break a customer retention strategy.
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