Long-term and repeat customers are critical to the health of any small business. Loyal customers provide companies with stable revenue and allow leaders to confidently plan for the future. Considering how vital customer retention is to a business’s survival, it should be a daily practice, not a once-a-year effort.
To improve your customer retention rate, you must plan, prepare and implement customer retention strategies. To prevent customers from leaving, take a holistic approach to customer care that includes the following practices:
When companies develop a new product or service, they consider its life cycle – from launch, to maturity, to revision or phaseout. Customers also have life cycles that need planning and nurturing to thrive.
The kind of service, support or engagement your customers need may change over time. Listening and learning about their business needs will help your company serve customers more effectively.
“Having regular interactions with customers will result in more relevant engagement consistently optimized by your business,” said Rita Tochner, head of operations at TrialJectory. “What this allows is a complete picture of your client, a 360-degree view as dynamic as the individual, showcasing trends and giving actionable insights to enhance their customer journey.”
Customers may have different service expectations from your company. Instead of following the golden rule, consider the platinum rule: Treat others how they would like to be treated, not how you would like to be treated.
Scott Stratten, co-author of UnSelling: The New Customer Experience (Wiley, 2014), recommended asking three questions to determine exactly what your customers want:
The answers to these questions will help you figure out key issues in the customer experience and provide a starting point for improvement.
Some small business owners and leaders focus on managing customer relationships and interactions without considering their employees’ customer dealings.
Consider the following best practices when you’re determining the resources employees need to provide excellent customer service:
All long-term relationships have rough patches. Friendships, romantic partnerships and family relationships need time and attention, especially when one person voices frustrations or wants another to change their behavior. Customer relationships also need time and attention; if you don’t nurture them, you may risk a breakup.
Here are some common reasons customers abandon relationships:
Businesses that rely on many customers may worry more about generating sales leads than on retaining current customers. This strategy can make current customers feel like an afterthought, especially after they’ve been wooed with promises of top-notch service.
Customers may get frustrated if your company is guilty of these bad practices:
Ideally, your company will be proactive about addressing issues or mistakes.
“If we see [an issue] happening multiple times over, it is a chance to reach out, communicate, engage and fix,” Tochner said. “This type of dialogue between the company and the customer is important because it creates a level of trust and appreciation, opening the door for a much more loyal, mutually beneficial relationship.”
But even when companies get the amount of client contact right, they may not listen or react to customer concerns with a sense of urgency.
“Take their feedback, and regardless of what you do, thank [the customer] and share it with your team,” advised David Niu, vice president of innovation at Limeade. “Close the loop. [Show them] you’re not just paying lip service but you’re doing something about it.”
Responsiveness and gratitude go a long way in proving you’re truly committed to customer satisfaction, Niu added.
The only constant in business is change. Companies evolve throughout their life cycles, and customers do, too. When companies have regular interactions with customers and listen to their needs, they are better prepared to grow and evolve with them.
Instead of treating customer relationship maintenance as another item on your to-do list, companies should keep tabs on customer satisfaction by collecting feedback regularly via customer surveys and taking the time to analyze and learn from the feedback, Niu said.
“One question we ask on a consistent basis is, ‘How likely are you to refer us to a friend or colleague?'” Niu said. “Over time, if a client rates [this question] a 9, [and] then it becomes 8, 7, etc., something is [not right] in [their] mind. You need to talk to them immediately. When they tell us reasons why they’re not happy, we have a blueprint to make them more satisfied.”
Without regular feedback on customer satisfaction, companies can miss the signs that their customer service and engagement are no longer meeting their clients’ needs. Feedback is a gift and will inform your company’s customer retention practices going forward.
The keys to customer retention are in your hands. Your company has access to all the information you need to provide excellent service that keeps customers happy and loyal. Customer retention practices look different for each company and type of customer, but they are all built on a foundation of active engagement and feedback.
Nicole Fallon contributed to the reporting and writing in this article. Some source interviews were conducted for a previous version of this article.