What Are Customer Retention Strategies?
Investing endless sums of money in marketing makes little sense if you cannot keep your customers coming back. It costs a lot of money to maintain a constant stream of new customers. E-commerce businesses have begun to wake up to the fact that funds are often more effective when directed toward keeping the loyal customers that they already have as opposed to attracting new ones. Indeed, studies have shown that it can cost up to ten times more to acquire a new customer than it can cost to retain an old one. When you look at it this way, the figures are pretty revealing.
When it comes to improving customer retention rates, there are a number of tried and tested strategies to which every e-commerce business owner should pay heed. Read on to find out more.
- Constant Customer Feedback
If your business is currently struggling to retain customers, the first thing to do is to diagnose why this is happening. A low customer retention rate can be down to a variety of things, but you will not find out unless you do some research into exactly what your customers think about your company and products. Offering a small incentive like a coupon for taking a short survey is one of the best ways to do this.
- Set Up a Referral Scheme
Referral schemes are a great way of both keeping existing customers and attracting new ones. Offering a reward, such as money off or a percentage of a sale made to a friend who a customer has referred, gives your customers a great incentive to stick with you. They will also do much of the leg-work in convincing other potential customers to buy from you, often in a more persuasive and personalized way than your marketing department will ever be able to manage.
The use of gamification as a customer retention strategy has seen a huge amount of research in the past few years. There is strong evidence to say that introducing a tiered loyalty scheme helps to keep people engaged and motivated to buy your products or services. Likewise, objectives and rewards such as badges which unlock privileges will lead to greater customer investment in your brand.
- Proactive Customer Liaison
When it comes to customer retention, employing someone as a customer liaison officer can be a very effective strategy. It pays to keep track of customers who have not bought from you in a while – reaching out to them with emails or texts about offers and promotions that you are currently running. A personalized outreach program can markedly boost your sales revenues.
In a world in which everyone is fighting tooth and nail for our attention, it can be easy to forget about a product or brand that you rate highly. By employing a range of the strategies for increasing customer retention explained above, you can put the money that you have spent on marketing to much better use.