Is it possible to have a 100% customer retention rate? Yes, when you know the equation, i.e. how to work out your customer retention rate (CRR), and you know how to reward customer loyalty and incentivize new business, the rest comes down to consistency.
You’ll need to know your customer retention rate see the equation here. While other equations also gauge how your business is fairing, including:
- Customer Attrition Rate
- Customer Acquisition Rate
For this article, we’re honing in on client retention. For example, if we ended the month with 240 clients, we’d subtract new customers (30) divided by the total number of customers at the beginning of the month (220), multiplied by 100 = 95.45% retention rate. To get to a 100 percent customer retention rate in our example, your new customers would be 20 during the month instead of 30.
- Use social media to converse with your community of followers
- Listen first then make sure your content is relevant
- Incentivize loyalty
- Happy customers will improve new business referrals
- Farming your current customers is easier and less expensive to expand than hunting for new clients
- Loyal customers buy more, and more often
Here are some tried-and-true tactics to keep customers happy, prospects interested and business flourishing.
1. Don’t mess with loyalty
Okay, so a pretty obvious first lesson. But really, don’t take loyalty for granted. Many business owners need to get out of the “we already have them” mind frame and treat their current customers like they treat prospects. Nourish and flourish.
Even with a successful marketing campaign, people might try you out, but it’s only if you build a relationship with the prospects to get them to come back. In today’s world full of options, a customer can easily choose another provider. And tell all their friends.
Don’t take loyalty for granted, and don’t underestimate the power of one-on-one relationship building. Customers return when they feel connected with the brand and a mutual sense of belonging.
2. Word-of-mouth is not new
This brings us to the second point. Once you’ve really satisfied customer needs, it’s without a doubt they will tell others about you.
If this happened to you with your business, it’s by no means a new discovery. However, the only thing that is actually new, unlike previously, is that you now have to go the extra mile. Since industries and options are so saturated, it is easier for customers to take their business elsewhere. And trust us, if you don’t measure up – they will.
Your service needs to over-deliver in every area because the expectations bar has been set so high and can also probably be met by your competitors.
Being good is no longer good enough. You need to do something truly outstanding (and relatable to your market) to really get them talking about you. Once you exceed expectations, customers will be referring their friends, relatives, neighbors, and co-workers.
3. Listen and help.
The internet offers unlimited possibilities. Brands can now actually communicate and listen to their clients and prospects, and we have social media to thank for it. Depending on where your target market hangs out,
Twitter or Facebook have been great for monitoring conversation, listening and helping. If a current or even potential customer is having issues and you know what the answer is, lend them a hand even if it doesn’t result in direct business. Trust us; it will pay off in the future.
Social media platforms are just one of the many avenues for your business to ask customers what they want and what they like and dislike.
You can also include a chat or customer surveys on your website, at the point of sale, in the newsletters, or just simply call a customer up to see how they’re doing. Also, do remember that customers expect you to take action if they complain, especially once you initiated the dialogue.
4. Act human.
It wasn’t until recently that people started associating faces with brands. On a larger scale, Mark Zuckerberg of Facebook and Steve Jobs of Apple are prime examples of making an organisation associated with a leading face. Meanwhile, other organizations haven’t been as dominant in associating people with their brands (who’s really the face of Google?).
Acting human and being able to relate to your customers on a personal level speaks volumes. It says that you’re one of them, bringing them up a level. They feel more comfortable speaking to somebody they can relate to and, in return, also have a more personal attachment.
Take advantage of the online platforms in sharing pictures, stories, tips and speaking in anything but a robotic tone.
Also, if you don’t have any negative comments – you’re not trying hard enough.
5. What have you done for me lately?
Incentives, incentives, incentives! If you’re nourishing a prospect and engaging him in the early stages, you should not abruptly cut off communication once they sign on. They assume that once a customer is happy, they will stay happy and continue to use the services. Wrong! Your customer always thinks, what’s in it for me?
So what can you do (or not do) during the customer’s experience? Some of the ways you can continue to interact with customers are through loyalty programs, inside news and perks, special discounts, newsletters, memberships, events – just to name a few.
Let your customers know that their success and satisfaction is important to you. You succeed when they succeed, so you need to do everything you can to keep your customers happy.
Use this as a benchmark. When customers are happy, that means the business is doing something right. It’s a simple concept yet needs to be instilled into a corporate culture and customer interaction. Take advantage of social media monitoring and communications tools.
The sky’s the limit for what it takes to make your customers and prospects happy.