9 Powerful Customer Retention Tactics for 2022
This blog was updated on January 31, 2022.
Making a sale is just the first step towards winning a customer – customer retention requires a bit more effort. And it’s worth it. Even a 5% increase in repeat customers can mean up to 75% more business.
Keeping customers pleased is one of the key building blocks of customer retention. And learning exactly how to keep customers happy is surprisingly easy – your own customers will tell you. Especially if you give them a convenient channel to provide you feedback.
This blog will walk you through nine customer retention tactics that you can easily implement.
Convenience is key when it comes to any stage of the customer service journey. It can be the difference between a customer staying – or leaving.
‘Convenience Orientation’ was discovered in a study back in 2002. The study highlights the customer preference for convenient goods and services, implying that a lack of convenience will impact the overall evaluation of the service.
So, it’s hard for any business to succeed without paying proper attention to making things convenient for customers. With competing services just a click away, customers will always choose the one they find more convenient.
The aim should be to make everything as easy as possible for customers, whether that’s moving through the purchasing journey, sending feedback or contacting customer service.
A great example of this is using SMS to get customer feedback in real time:
Allowing customers to respond easily with a number or a simple “YES” or “NO”, creates a user-friendly experience. Just like in the above example, convenient surveys can also boost customer engagement and satisfaction. This continues the conversation post-sale and helps get positive reviews, resolve complaints and make sure your customers are happy.
See more about how you can make SMS a part of your messaging strategy.
2. Make it personal
There are quite a few ways you can personalize the customer experience. We can name six. One way is to use your customer’s name in emails, texts or even on your app.
Booking.com is a great, if incredibly simple, example of this:
Using your customer’s name welcomes them back to their app, every single time they log on.
Social Media plays a huge role in customer retention and is the best place to get personal. Replying to posts from your customers can help you create a relationship with them – which can be the deciding point between you and a competing brand.
Customers aren’t always swayed by the cheapest option available – personalization is a very important factor in making a buying decision. According to a report by Walker about the future of customer experience, customer experience will be categorically more important than price by the year 2020.
3. Surprise and delight to generate word of mouth
Your customer relationship doesn’t have to rely on a quid pro quo. How about surprising them instead?
Surprises could include flash sales or unexpected discounts – you’ll still get the sales, but your customer gets something out of it too.
This tactic, sometimes called “surprise and delight,” can create real brand loyalty. 95% of people agree that it boosted their positive perception of a brand.
Sometimes the surprise is in doing something that goes above and beyond customer expectations. American company Trader Joe’s is famous for this story that went viral on Reddit:
Trader Joe’s did what no one else would, and the coverage generated more business for the company – recouping the cost of this thoughtful gesture many times over.
Here’s why it works – if a customer walks away with more than they bargained for, they’re likely to come back for more. And they’ll probably bring along their friends.
This is because word of mouth works. 90% of people trust suggestions from family and friends, according to research from Hubspot. So, family and friend referrals are a good way to start building new customer relationships.
A good example is Evernote, who have a referral program that doesn’t stop after the first referral. Evernote allows customers to refer as many people as they want in exchange for points. Then they can even earn more points if their referral upgrades to the premium service.
4. Create helpful content
Most companies today rely on content to help engage customers, as well as convert them. But even more than this, useful content helps with customer retention after the sale.
It could be instructional content to help your customers assemble or use your product – like IKEA, who have assembly videos on their website.
Or consider the example set by ahrefs.com, who help their customers use their software more effectively. Instead of leaving the customer to figure everything out themselves, they create helpful content that guides them.
Knowing where to start with creating this type of content can be challenging. It’s best to start by understanding common customer challenges and addressing those specifically. After this, you can learn even more about your customers and their challenges through mobile surveys, behavioral data, and more.
5. Reach customers on their preferred channels
Using the channels that your customers prefer is a great way to improve your customer service. Start by using the appropriate platform for your business, and the one that suits your customers’ needs the most.
It’s common knowledge that social media is where you’ll find your customers and be able to easily reach out to them.
If customers follow you on social media, it’s a good idea to interact with them. This simple gesture will make them feel valued by your brand, which goes towards nurturing customer loyalty.
Most importantly, you can also use social media to listen to your customers and respond to their feedback. In fact, a lot of brands have separate social media accounts just to talk to their customers.
6. Address customer complaints
Bill Gates once famously described unhappy customers as the “greatest source of learning,” and there’s so much truth in that quote.
Although it may not feel like it at the time, your least satisfied customers can be some of the most valuable when it comes to improving customer retention.
Learn from their experiences and take steps to make sure it doesn’t happen to anyone else.
What else can you do? Apologize. When dealing with dissatisfied customers, the best thing a business can do is say sorry. 45% of complaints are withdrawn following an apology, compared to only 23% of complaints withdrawn after receiving compensation. Apologizing is the responsible thing to do, and customers value this approach with increased brand loyalty.
Disney is well known for having excellent customer service, and they follow the H.E.A.R.D framework.
Hear Empathize Apologize Resolve Diagnose
Disney employees are encouraged to follow this framework in every aspect of their jobs – and it works.
7. Reward new and loyal customers alike
Loyalty programs are a great way to keep customers coming back for more. 73% of customers believe that brands should have programs that reward customer loyalty.
Programs like this offer real value to existing customers, while also telling new customers that you appreciate and reward loyalty.
It also helps show that you appreciate your customers and want them to have a great experience. Giving them something in return for their purchases adds value to their continuing customer experiences, persuading them to come back.
8. Create a customer community
Create a place where customers can go to share content. Social media channels work well for this, especially considering the small amount of effort that goes into it.
Give your customers the opportunity to leave reviews or photos and allow them to comment on each other’s posts.
This creates a sense of community that people will automatically associate with your brand.
Sephora is a great example. Sephora has a very active online community where users can have conversations and share photos. Added bonus – Sephora can also use it to gain valuable product research insights.
9. Re-engage lost customers
Despite even the best efforts, sometimes customers simply leave.
This is where re-engagement comes in. You’ve probably received this kind of campaign in the past – it’s where a business you haven’t used for a while reaches out with an offer for returning customers.
It’s a great way to make your customers feel valued and show them it’s worth their while to return to your brand.
Thanks for reading
Customer retention is easy when you have the right tools for the job. Our free eBook, “What Customers Want – A Retailer’s Guide to Digital Customer Experience” teaches you how to use all the tools you need to employ customer retention tactics that work in 2021 and beyond.