Did you know that it is seven times more expensive to acquire new customers than retain your existing ones? Still, a lot of business owners are more hyper-focused on acquiring customers than nurturing what they have.
Sure, having new customers indicates how popular your business is. But they can leave you as quickly as they arrived if you do not give them satisfying customer service.
Here's the thing: Happy customers will always keep coming back, and they can help you boost your revenue.
Why Customer Retention is Vital
Retaining customers is crucial to the survival of any e-commerce store. Like we mentioned, keeping customers is a lot more cost-effective than acquiring new ones.
In fact, according to the Harvard Business Review, customer retention increases company revenue by at least 25%.
So, without a doubt, retaining customers brings in a lot of ROI to your company. So, neglecting your existing customers in pursuit of newer ones is often a mistake.
That's why maintaining a low client churn rate and having a solid and proactive customer support program is essential. That way, your existing customers don't fall through the cracks.
Calculating Your Current Customer Retention Rate
Before we start building a customer retention plan, we need to understand your current customer retention rate. This number gives you an idea of the percentage of customers that are still sticking around.
You can easily calculate your customer retention rate using this equation:
Customer retention rate = (# of customers at the end period - # of customers gained during the period) / # of customers at the start of the period * 100
Knowing this is crucial because it allows you to know whether you can keep your customers coming back.
Also, according to a report, a retention rate that is 35 percent or higher in e-commerce or the SaaS industry means that you're doing relatively okay.
Now that you know how to compute your customer retention rate, we'll walk you through the eight surefire ways on how you can enhance your customer retention rate. You should develop a customer centricity mindset inside your company if you want to experience continuous growth.
How to Effectively Improve Your Customer Retention Rate
Customer retention plays a significant role in your marketing plan's value. Utilize these strategies to create the perfect customer retention solution.
1. Pay attention to your onboarding process
If you have a business, then chances are, you already have customers. All you need to do is to make sure that you stay loyal to your brand. One of the best ways you can do that is to build a transparent onboarding process. Your customer onboarding program allows your customers to learn more about the products and services that you offer. In the same way, it will support and guide your customers. Doing so will make it easier for them to know more about your business and the products and services you offer. This increases their loyalty in the long run.
2. Delight your customers
Customers crave to have a positive experience with you. In the same way, they'll never forget a bad one as well. Marketers don't just want to meet customers' expectations but they should do their best to exceed them. In fact, according to Defaqto Research, 55% are willing to pay more if it means that they'll be getting a better customer experience. Here are some helpful tips on how to deliver an excellent customer experience to your customers: • Free Delivery: Offer free delivery, not just when customers reach a certain amount but also on all orders. • Free Returns: You can win over more customers if you're offering them a risk-free way of buying items. • Click to Collect: If your business is not a physical location, then provide your customers with an option to get what they bought in-store.3. Ensure reliable and stellar customer support
Think about the last time that you had a terrible experience with a company. The same is true with your customers. If they're unhappy with the service you provide, what do you think would make them come back in the first place? So, if you get a complaint from your customers, don't ignore it. One of the best things to do is resolve it as soon as possible, ensuring that you satisfy your customers' needs. You can also make it a lot easier for customers to submit any complaints. Ensure that there's an available Contact page on your site, display your email in the footer, and make sure that you're on social media. Then, use the insights that you've gained from these complaints to create a better customer experience. In the same way, you should also have a live chat or a help desk tool that can quickly turn a question into a sale or resolving a customer complaint. Usually, resolved complaints and issues can turn unhappy customers into loyal, repeat customers in the long run.4. Create a loyalty program
Loyalty programs should be a crucial aspect of the customer retention system. Usually, these programs reward customers by offering incentives on their next purchase. After customers join your loyalty program, you can make them feel special by providing them with tempting offers. Offer sneak peeks of your products, exclusive deals, and so on. Giving them this kind of treatment will make them feel valued and a crucial aspect of your customer retention strategy. You can even provide a customer with benefits similar to a loyalty program before opting in. For instance, you can offer a buyer a discount code inside their confirmation email. The best part is, they don't have to sign up for anything. All you need to do is to straight out give them a discount.
5. Adopt a customer-centric email marketing approach
Email marketing plays a significant role if you want to keep your current customers while marketing your business at the same time. The thing is, people are more likely to click and open emails when they look personal. For instance, you can mention your customer's name when you want to address them via email. In the same way, you should send customized emails to thank customers, letting them know that you appreciate them buying from you.6. Look at your online presence
Because you have your store online, then it makes sense that you reach out to customers on sites where they're spending the most time. Usually, you can find your target market on social media, especially Millennials and Generation Z. Having a solid social media presence and strong brand identity can play a big difference whether a customer stays or churns. It offers you a platform that allows you to connect with customers in real-time. You can also monitor your social media presence via mentions, hashtags, direct posts and create a social media monthly report to analyze your posts' engagement. I'm saying monthly but it could be weekly or quarterly as well. Similarly, you can respond to any questions and concerns and let customers say positive things about your brand.7. Offer value through content
One of the best ways to keep your customers happy is to allow them to get as much as possible from your products and service. Each time a customer is on board, you shouldn't leave them in the dark about how you want to use a particular product or do specific tasks. However, don't give everything on a silver platter. Many people want to find answers to specific questions on their own. Hence, provide "self-service" options to empower them to look for solutions before they resort to customer support. So, apart from having customer service agents start building an extensive knowledge base. Fill it with helpful articles, tutorials, and case studies. In this case, you might want to consider investing in the right content marketing tools. This makes it simple for customers to figure out how to use your product or service.8. Try web push notifications
When a customer or a prospective one lands on your site, they might get stuck on the About Us page, Features, Our Product Pages, and so on. Then, a couple of seconds later, they'll switch to another website. Although prospective customers can still go back to your site and order something, the likelihood of forgetting it is also high. So, how do you miss out on the chance of turning them into potential customers, and retain them on your site before you make a purchase? One of the most efficient ways to do that is by trying out web push notifications. In a nutshell, these are small dialogue windows that show up on a site. Its purpose is to help site visitors with their actions and offer other steps based on their activity. Overall, web push notifications increase traffic and boost customer re-engagement.9. Underpromise and overdeliver
One of the best ways that you can boost your customer retention rate is to over deliver. See that your customers are impressed with what you have to offer and always do more of what's expected from you. If you do, then your customers are more than willing to stay with your products and services. When you are above and beyond, you can offer your customers things they didn't expect, allowing them to become loyal advocates of your brand.Improve Your Customer Retention Rate With These Tips
Contrary to popular belief, customer service does not begin when someone purchases your product. It starts as soon as they hear about your brand, visit your site, and buy your products or hire your services. As such, we suggest that you follow the tips listed above. Doing so allows you to turn buyers into repeat customers. Growth Hackers is one of the leading e-commerce marketing agencies helping businesses increase their engagement, retention and revenue. We help startups, small businesses and entrepreneurs succeed by defining for them eCommerce strategies. If you are looking for customer retention rate increase, contact our growth marketing experts now and you'll see your engagement and revenue grow in no time.
Jake Rheude
I am the Director of Marketing for Red Stag Fulfillment, an ecommerce fulfillment warehouse that was born out of ecommerce. I have years of experience in ecommerce and business development. In my free time, I enjoy reading about business and sharing my own experience with others.
