Did you know that repeat customers are an important, perhaps the most important, revenue generators for your business? According to a recent study by SumAll, they account for 25 – 40 percent of your business success.
Even more telling, “businesses with 40% repeat customers generated nearly 50% more revenue than similar businesses with only a 10% repeat customers.” Additionally, repeat customers spend 67 percent more than first-time buyers.
Customer Retention is not just a lofty goal to aspire to – it’s an important factor in the success of your business.
But how do you retain customers? How do you make sure that they don’t forget about your products or services after the initial purchase?
Several strategies can accomplish customer retention; here are just a few.
Manage Contacts
First, gathering data about your customers is crucial. A good CRM (customer relationship management) software can help with this first step. The more you know about your customer, in terms of their contact information, their past purchasing behavior and their interest, the more easily you can contact them in a targeted fashion for future offers.
Offer Rewards
Once you know how to reach your current customers, you may want to think about offering them rewards to come back. Loyalty programs are among the most established marketing tactics around, and for good reason: 46 percent of customers buy from brands specifically because of loyalty programs. Giving your customers a reason to come back with coupons or other reward is effective.
Listen
But a part of retaining customers is also listening to the ones that have been unhappy with their purchase or service. They may voice their opinion on social media or review sites like AngiesList or Yelp, which doesn’t only mean they’re not coming back – they also may prevent others from conducting business with you.
Social listening strategies such as monitoring mentions on social media or web reviews help you find your unhappy customers and begin interacting with them. Simply being honest, apologizing and looking for ways to improve based on these reviews can go a long way toward turning unhappy customers into brand advocates. Actual improvement is key: 96 percent of unhappy customers never complain, and the only way to turn them into repeat customers is to hear them and then improve your service.
Engage in social responsibility
Finally, here’s a more indirect way of increasing customer retention: be active in your community. You may think that it doesn’t matter for your actual bottom line, but you would be wrong. No less than 93 percent of customers are more loyal to companies that engage in corporate social responsibility through charity contributions or community service. That’s especially true if you’re a local business, and your customers can see the difference you’re making in their neighborhood.
Repeat business is incredibly important to your financial success.
Retaining customers does not happen by accident. It has to be an element of your marketing strategy that is planned and executed. Not sure where to begin your plan for customer retention? Start with context: The Marketing Hourglass™ explains how to grow your business by concentrating on engagement.
Feel free to download this FREE ebook to learn more.