Growing your company from a small business into a large one starts with satisfying customers to the point they become loyal.
While loyal customers may only account for up to 15 percent of your entire customer base, they can be responsible for generating as much as 70 percent of your sales.
In other words, a mere handful of customers have the power to potentially make or break your business.
This being the case, it is critical to focus on retaining customers as much as you possibly can. In fact, research suggests a mere 5 percent increase in customer retention can translate into a 25 percent–95 percent increase in profits. This makes sense—particularly when you consider the fact that it costs seven times as much to sell to a new customer as an existing one.
The good news is that retaining customers isn’t necessarily difficult. You just need to have a solid company and a strong customer-focused strategy.
With that in mind, let’s take a look at seven tactics you can employ to improve your retention stats.
1. Solicit customer feedback directly and regularly.
The easiest way to find out whether your customers are happy with your company is by asking them directly. Otherwise, you could be doing something that is alienating a bunch of your loyal supporters without having any idea that’s happening.
Soliciting customer feedback directly—through email surveys, social media polls, and in-store feedback cards—proves that you care about what your customers think. And it also enables you to implement some of the best ideas they come up with, which should make your business stronger.
2. Invest in content marketing efforts.
Your business doesn’t have to stop adding value the moment money changes hands.
For example, by investing in content marketing and creating blogs, e-books, infographics, and videos that educate and entertain your customers, you can transform the customer journey into an ongoing process—something that is critical in today’s digital world.
Content marketing investments prove to your customers that you care about adding value even after a transaction is finalized—which should help boost retention stats.
3. Make it as easy as possible for your customers.
Thanks to Amazon, everyone knows how easy it should be to buy something online. Unfortunately, not every company is configured for e-commerce. Similarly, not every company takes credit cards—and those that do don’t always take American Express, for example.
Today’s customers care a great deal about having personalized and customizable experiences. If you wish to retain more customers, you need to make it as easy as possible for your customers to support your business and pay for products.
If you haven’t already, consider optimizing your site for e-commerce. You should also try to add more flexible payment options so that your customers have more choices.
4. Support social causes.
A recent study suggests that 70 percent of millennials will spend more money on a brand if that brand supports social causes (e.g., the environment) that the individual cares about. So, for example, if you’re a restaurant owner, you may want to consider sourcing ingredients from local farms.
Figure out which causes your customers care the most about and donate some of your profits to them. In addition to being a nice thing to do, your social outreach is also a marketing tool—one that should make retaining customers easier.
5. Continue innovating.
You can’t expect to sell the same products—and only the same products—forever.
The liquor store needs to switch up the beer selection every now and again. The restaurant needs to serve up specials every day. The clothing retailer has to offer the latest designs and trends.
Don’t rest on your laurels. Your retention stats should improve when you continue to bring new products to the market.
6. Launch promotions and loyalty programs.
Who doesn’t like free stuff?
An easy way to convince customers to spend more money at your business and continue supporting it is by launching a loyalty program that rewards them for their regular patronage. For example, if you own a deli, you may want to give customers one free sandwich after they’ve bought 10 (or something to that effect).
7. Make customer service a top priority.
Businesses are 14 times more likely to sell to an existing customer than a new one. But in order to be able to do that, you need to keep your existing customers happy.
By making customer service a top priority, you increase the chances that your customers enjoy their experiences with your brand. That translates into happier customers who are more likely to support your business and evangelize on your behalf.
Growing your business doesn’t necessarily mean expanding your customer base. When you improve your ability to retain customers, you will almost certainly see your revenues grow and your bottom line become healthier.