Mastering Customer Retention & Satisfaction
Posted on 09/22/2021 at 10:00 AM
Are You Paying Enough Attention to Customer Retention?
If not, you may be costing yourself some serious $$$! Your chances of selling to an existing customer are 60-70% while your chances of selling to a new customer are only 5-20%! But what can your business do to improve customer retention? The answer lies in the relationship between customer satisfaction and customer retention.
"If your retention is poor then nothing else matters." -Brian Balfour, Founder/CEO of Refuge, Former VP Growth at HubSpot
The Relationship Between Customer Satisfaction and Customer Retention
The idea that a happy customer is a good customer seems simple enough but there is a bit more nuance to the correlation between customer satisfaction and customer retention. Simply put, customer satisfaction is how customers feel while customer retention is how customers act. Differences aside, customer satisfaction does have a positive correlation with customer retention so keeping your existing customers happy is crucial to success.
"There is only one boss. The Customer. And he can fire everybody in the company from the chairman on down simply by spending his money somewhere else." - Sam Walton, Founder of Walmart
There are many ways to ensure that your customers are happy so it is important to have some form of strategy in place. When strategizing there are a number of things you should keep in mind.
Optimize the Customer Experience: For e-commerce, this means having a user-friendly website that is easy to navigate, find what they are looking for, and the ability to get any questions they may have answered. For brick and mortar businesses, this means having a clean, presentable, and organized space that feels welcoming. Good customer service is a critical aspect of customer satisfaction, but one that is often neglected. Friendly, helpful, and knowledgeable staff are important throughout the entire customer experience from greeting the customer, to assisting them in any way they need to making sure everything went well and thanking them for their patronage. Having some sort of "wow factor" can also contribute to customer satisfaction. This could mean anything from unique packaging, small freebies, or even simply offering or doing something your competitors don't. All of these individual things added together create a consumer experience that is bound to satisfy any customer.
Make the Customer Feel Valued: Making a customer feel appreciated is an important step towards transitioning a customer from simply a happy customer to a repeat customer. In addition to providing quality customer service, customer loyalty and rewards programs can be a great way to build a bond between a customer and your business. This can incentivize them to keep coming back. The possibilities for loyalty/rewards programming are endless from simply offering customers and coupons after their first purchase to points-based rewards systems or even "membership" systems that allow for early access to new products or sales. Actively seeking customer feedback can show a customer that their opinion matters and also provide valuable insight. Customer satisfaction surveys can be done in any number of ways from a confirmation or thank you email with a survey attached to having a feedback submission form on your website.
Utilize Customer Feedback: Who would know how to improve your customer's experience better than actual customers? Both positive and negative feedback present a valuable opportunity for businesses. Positive feedback lets you know what you're doing right and should keep doing, while negative feedback points out areas for improvement that you may not have realized on your own. Negative reviews online present a unique opportunity to not only point out areas for improvement but to actually contribute to your brand image and improve customer satisfaction. Responding to a negative review posted online by respectfully acknowledging the problem and addressing how you will rectify it not only shows integrity but also assuages any concerns potential customers may have.
With a strategic and consistent focus on existing customer satisfaction, retention of those customers should naturally follow.
As previously discussed, customer satisfaction is how consumers feel while retention is how they act.
So if customers feel happy after their experience with your business, they are more likely to act by coming back again and again. Once you have mastered customer satisfaction the benefits of customer retention will follow. These benefits can be sizeable and include building brand loyalty, reducing marketing costs, and notably increasing profits. In fact, increasing customer retention by just 5% correlates with at least a 25% increase in profit! You may worry that a focus on retaining existing customers will cause you to miss out on new customers, but this is not the case. 92% of customers trust recommendations from friends and family so a happy customer is likely to spread the word and recommend your product or service to people in their network. Mastering customer service, and in turn, customer retention can do countless wonders for the success of your business.
How Global Reach can Help You Achieve Customer Retention
Global Reach’s web development, digital marketing, IT support, and graphic design teams are here to help you maximize your customers’ experiences. Throughout every step of the commercial process, Global Reach can help you achieve success. Contact us today for a free consultation and see what Global Reach can do for you and your business today.
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