While the basics of customer retention may vary by company, the benefits of customer retention stay the same. The importance of customer retention is universal. More customer retention means that a company is able to grow with increasing stability.
The company is able to improve upon its revenue and has more consistent revenue. The company has greater levels of ROI because it’s spending less on retention than it would on acquisition. All of these are reasons why companies today want to improve customer retention foremost.
But when companies look into how to increase repeat customers, there isn’t a single one-size-fits-all solution. Customer retention articles vary depending on the company’s industry and size, and the importance of customer acquisition doesn’t mean that the methods of acquisition and retention remain the same. The importance of retaining customers must be stressed just as the importance of developing a custom retention strategy.
First, companies need to look at why customers are leaving. They need to identify the major pain points and develop processes and strategies that address those points proactively. A company has to have a strategy: They can’t just have a general directive to keep customers on the hook. Employees need to be able to produce value to the customers.
Many companies develop their retention strategies over time. They need to track the correct metrics first, and then create a comprehensive strategy based on those metrics. Technology can help. Modern technological platforms make it possible to track the customer’s entire relationship with the business, from the start of the buyer’s journey to their projected purchases in the future. The more data there is, the more likely it is that the business will be able to identify the hallmarks of a customer that’s about to leave.
Customer Retention Strategies
Every company needs a thorough customer retention strategy. Teams need to have plans, goals, motivation, and to understand the deep “why” between it all. Before they begin to execute this plan and delve into the details, they also need to be able to come up with strategies for each situation. PDFs and PPTs can be used to describe and sell a plan to the C-suite, and CRM solutions are excellent technologies that can be leveraged for better planning.
Customer retention strategies will always vary from business to business. While developing a customer retention strategies PDF or customer retention strategies PPT, companies should strongly consider their industry and competition. Employees need to understand that their customer retention strategies in CRM may look different from a company in another industry or even just another size.
Regardless, there are levels of customer retention strategies, and there are both positive and negative customer retention strategies depending on the emphasis. Consider customer retention strategies in service marketing. Customers will frequently look for better deals and get courted by the competition. Strategies have to involve building relationships one-on-one with customers and being knowledgeable about the deals being offered.
But look at the customer retention strategies in automobile sector companies. Customers are far more likely to be loyal to automobiles and they usually change automobiles when they’ve experienced something negative. Now, customer retention strategies are more based on ensuring the high quality of the product rather than one-on-one time with the customers.
Without a tactical plan, employees are not going to be able to operate consistently. While they may have some abstract idea that they’re supposed to keep customers, they’re going to apply these tactics unequally. Over time, this can mean that either few customers are actually retained, or (even worse) the highest value customers aren’t retained.
Further, having a strategy is the best way to determine whether your processes are operating correctly. If your results for your current retention strategy aren’t effective, then they need to change. But if you don’t know what your processes are, you’re not going to be able to improve them.
Customer Retention Examples
Customer retention examples are a great way to help a team understand why retention is important and how to achieve it. Once a team understands the basic concept of customer retention and has a strategy in place, it’s time to execute and build out tactical details. Examples help to show what is good and what isn’t. Of course, examples will also differ across each industry; pick the examples that relate most to your business. Case studies and PDFs are excellent resources.
Let’s consider some of the customer retention strategies case studies you might see in a customer retention PDF or literature review on customer retention PDF.
- How to retain clients in financial services. For many clients, customer service and a personal touch comes first. A client would rather trust their advisor entirely than have the greatest yields necessarily. Clients in financial services understand the market is volatile. Someone who will consistently get them 10% returns is better than someone who will get them 15% one year and 0% the other. An example of good customer retention would be to regularly hold one-on-one meetings with customers to improve upon their relationships.
- How to retain customer in bank services. We have a lot of information on how to improve customer relationship in banking, based on big banks. In general, most people stick with their existing bank unless they experience a major issue, because it’s difficult to change banks. Thus, bank services can start having surveys after interactions to determine whether the customer is happy. If the customer says their issue is still unresolved, it can be escalated.
- How to retain customers in retail. This strongly depends on whether it’s brick and mortar or online, because how to retain customers online is very different from how to retain customers in real life. But in retail, customers are strongly driven by greater selection and better deals. Sending coupons out to existing customers is a great way to retain them.
Once you’ve reviewed enough customer retention examples, it’ll become second nature to consider how customer retention can be improved.
Customer Retention Model
A customer retention model is similar to a strategy, but it relates more closely to the technology that is used to execute the strategy. While the strategy may explain what employees are to do, the customer retention model and customer retention process shows how they are to achieve that. Today, there are many advanced customer relationship suites that can be leveraged for exactly this reason.
A company might have a strategy that includes sending a welcome gift after the first call. But they need to know how to collect the contact information and how to automatically send out these gifts. Customer retention approaches are both idea and implementation, and a customer retention strategy template should go over the ins and outs of how the ideas are actually implemented.
As with a strategy itself, building certain tactics and situations, and finding new and critical tools, can build a playbook a team can follow and a toolset that the team can use. The more reliable the strategy and model, the less managers are required to micromanage, and the more managers and owners can instead devote their time to strategic priorities and revenue-generating tasks.
Furthermore, the model will evolve and be changed over time. Because there is a strategy in place, the strategy can be updated and revised, and controls can be used to determine how these changes are impacting the model and the company. Without having a model to begin with, it’s impossible to adjust things this way.