Whereas many businesses focus more on customer acquisition, customer retention is equally important. Customer retention is your business's ability to make your customers come back for a given period. It is also how to survive inflation as a small business.
When you retain your customers, that indicates that your product or service pleases them. Your customers don't see the need to turn to your competitors. So, how to boost client retention?
Why Is Customer Retention Important?
You spend a lot of resources to get new customers, so you wouldn't want your efforts to go down the drain. Customer retention is a vital aspect of business strategy and helps your business gain a competitive advantage.
Customer retention is how to adapt to inflation and aims to maintain your business customer base and improve loyalty. You can also learn how to use marketing during a pandemic. Other benefits of customer retention are:
- Loyal customers give positive reviews and recommend your business to other people.
- You get a higher RPI from repeat customers than first-time customer acquisition.
- Return customers spend a lot on your business over time and increase profits.
5 Successful Client Retention Strategies
With inflation, prices rise, and your customers want to cut costs. You can deploy various retention strategies to retain your customers when inflation happens. If you’re wondering how to increase customer retention rates, here are five strategies on how to boost client retention.
1. Appreciate Your Customers
A customer who feels valued by your business will want to come back repeatedly. Your customer's loyalty increases when what you offer goes beyond the usual product or service.
For example, handwrite a customized thank you note to customers. You can include something specific like your customer's name to create a sense of personal touch.
Other customer retention examples are discussed below.
Add a Package Insert to an Order
Your customers yearn to open the box and see or use the product. How about you increase your customer's delight with a gift that isn't part of the original order? For example, if you sell cakes and bread, you can add a packet of coffee to your customer's order.
Then, attach a note to let your customer know that the package is not a mistake but a gift.
When a customer makes several purchases from your store, give a coupon for the current or next purchase.
A coupon makes your customer feel the care and value you place on clients. If you provide a coupon for the next purchase, your customer will want to come back and use the coupon to get a good service at a lower price.
Give Surprise Upgrades
Be generous about customer elevation, no matter what business you are in. Surprise upgrades could make a customer's day, boost self-esteem, and make your customer come back.
For example, if you have a restaurant, surprise a regular customer with special table space at no extra fee. Surprise upgrades shouldn't be costly, so you don't have to worry about losses.
2. Leverage Customer Feedback
Always have a platform where you can get views—appreciation, complaints, suggestions—from your customers. You strengthen the customer-business relationship when you get direct information from your customers about your goods and services.
Once you learn how your staff can make or break the customer experience through feedback, you can also re-engage a customer who plans to give up on your business.
Be there any complaints, catch the pain points and adjust to satisfy your customers' needs. A customer who complains is ready to stay if you work on the complaints.
You wouldn't benefit if a customer walked away and you didn't know why the departure occurred. Through complaints, you understand any defects in your goods and services.
3. Frequent Communication
Keep in touch with your customers to boost trust levels and eliminate post-purchase doubts. Even if your customers don't reach out with feedback, be proactive with the communication.
Also, monitor those customers who haven't communicated in a while to reestablish the relationship.
Invest in a communication calendar tool to keep track of customer communications and manage customer engagements. With a calendar, you receive alerts when a customer reaches out and when repeat customers haven't interacted with you for some time.
Also, when you inform your customers about your processes, your customers feel valued and important.
4. Build Trust and Good Relationships
Your first tactic toward a relatable brand is to build trust with your customers. If there is no trust between you and your customers, you won't establish a solid customer base.
So, use your customer data to explore your customers' needs and offer a positive experience. Once you build trust, you don't have to convince customers to buy your product or seek your services.
Your customers are human and love when you understand and treat them right. When you know your customers, you make rational decisions to cultivate the relationship.
So, improve your business based on customer feedback to understand and give the best experience to customers. Many customers who trust you will stick with you and recommend other people to your business as an added advantage.
5. Educate Your Customers
Invest in your customer base with customer education services. For example, you can have a self-service portal and then train customers to find solutions before contacting your support team.
Let your education program extend beyond your products or services to other fields that interest many customers. Areas that may not be directly about you include sales and entrepreneurship.
Educational programs position your business as a resourceful brand. Customers will stick to your business if you can offer solutions to problems.
So, create content that answers questions to your customers' life puzzles. If you aren't sure what to educate your customers about, do a survey and use the results for inspiration.
How To Survive Inflation as a Small Business
The basic counterpunch for your business to survive is to increase the prices of goods and services. Whereas most of your customers wouldn't want a price increase, you can't acquire goods at a higher price and retain the selling price.
Nonetheless, you can raise the prices of products that have a higher impact on your margin or that are likely to help most customers easily adjust.
Even though customers are price-sensitive, most don't always read the fine print. So, if the price rise doesn't sit well with you, use the shrinkflation strategy. Shrinkflation is when you leave your prices unchanged but reduce the number of products in each package.
For example, you can reduce a box of biscuits from 16 to 14 ounces and retain the price.
Customers are your business' foundation because you can't succeed without business strategies for high inflation. So, learn how to boost client retention after you use resources to obtain the customers.
An effective way to do so is to use the strategies discussed above. Also, inflation is bound to happen, so always be ready to take the necessary survival steps.
About the Author, James Webster
James Webster, founder and Executive Chairman of ROK Financial has almost two decades of experience within the financial services industry. His passion for helping small business owners and his innovative way of thinking, has allowed him to run multiple successful businesses including National Business Capital & Services. Under the National name, the team was able to help secure over $1 Billion in financing for small businesses nationwide.