28th Feb, 2018
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As the saying goes, “It’s good to make new friends, but it’s equally important to retain the old ones”. Same applies for business. In fact, retaining your existing customers brings in more value and is also much less expensive than acquiring the new ones. Research conducted by HBR reveals that an increase in customer retention by just 5 percent, can lead to an increase in profit by 25 to 95 percent.
Customer retention is certainly not meant to undermine the criticality of getting new customers onboard. But retaining large percentage of your existing customers for a longer life cycle can help you build on a more strengthened, as well as predictable revenue foundation.
While we all understand the criticality associated with retention, it is the ‘how’ part which dons the tricky hat. With almost everything – right from need expression, to delivery, to even the channels associated with the entire process – it all spells dynamism much more than before. While dealing with all this volatility, management of the churn rate while ensuring a good retention score have become quite challenging.
On the same lines, let’s see what are some of the key points which may prove helpful in converting your existing customers into long-haul partners? Read on…
Under Promising and Over Delivering
Customers tend to remember negative experiences more than the positive ones. By setting expectations early and a bit lower than you can deliver, you will be able to eliminate uncertainties regarding the level of service that requires to be offered. When trying this tactic, all you need to ensure is that you always deliver more than expected.
Zero-Compromise Customer Service
Providing exceptional support is a great way to improve customer experience which further translates to better retention rate. At times, even lending an ear translates into being an emphatic service provider and strengthens the collaborative bond. Statistics from salesforce desk reveal that 68% of customers leave a brand due to poor customer service.
Leveraging Data and Technology
Anticipating customer grievances and fixing them way before it amplifies is a great way to augment customer experience. By leveraging data and predictive analytics technology, you will not only be able to avert a lot of issues beforehand, but also be able to inculcate loyalty, create ardent advocates amongst your customer base.
Optimizing the Onboarding Process
Once the customer account is won, another uphill and may be, an even more critical journey begins – onboarding the customer while ensuring there are no gaps between the promised and the actuals. A proper transition from the business development team to the actual team happens in this phase and any lax at this stage sets your primary impression in the customers’ minds. Creation of effective SOPs, SPOC team etc. are also to be taken care of with utmost care.
While all these small-big thumb rules are there, it is important to alter them wherever required to fit your specific business frame. You may test new approaches or use a mix of different retention strategies. Ultimately, it is all about, what may work for you may not work for the other and who knows, your innovative twist in the established strategy, might land you miles ahead of your competitors.