Startups often focus on how they can attract customers, but often businesses neglect to focus on retaining said consumers. How can startups reduce churn with each new customer that they get? This post lists the 9 simple tips startups can utilize to increase customer retention.
Anand Damani is the director of Galaxy Web Links, a partner at Trimurthy Dye Chem Industries, the owner of Resin and Pigments, and a partner at Shri Radhika Agencies. He is also a Mentor at the Founder Institute.
The article "9 Ways to Retain Customers in Business" originally appeared on Anand Damani's LinkedIn. It has been republished below with permission.
Businesses lose a significant percentage of their customers every year, simply due to poor customer relationships. Retaining customers is undoubtedly the most critical aspect of any business, as bringing in new clients takes a lot of effort, money and time. According to a survey, getting a new customer is five times more costly for a business, than retaining an existing one.
Poor customer retention can become damaging for a business over time. Even a slight reduction in customer retention rate can permeate through the entire business process and multiply in the future. This impacts the long-term profit and growth of the company and so, it is something not to be underestimated.
Below I have jotted down some customer retention strategies that are cost effective and easy to implement. Following these comprehensive steps will help improve your customer retention rate and eventually, your bottom line:
1. Keep Customers Satisfied
The most basic client retention strategy is to keep the customers happy and content with your services. Happy customers are more likely to tell their friends and family about your business, resulting in a positive word of mouth publicity. Keeping your customers satisfied and maintaining strong relationships not only turns them into your loyal customer, but also increases the chances of getting more such customers who trust your business services.
2. Happy Employees = Happy Customers
If you take care of your employees, they will take care of your customers. When employees are allowed to participate in company matters, they assume a sense of responsibility and are likely to work as a leader. Employees who are given the opportunity to be heard, are able to deliver more personal experiences to clients which helps to build customer loyalty.
3. Reduce Customer Outflow
Not each and every customer can be retained forever and it is normal for businesses to lose some of their clients. However, only a few business owners analyze the data of customers becoming inactive and the reasons behind it. You cannot resolve an issue, unless you know what is wrong. And so, it is important that you measure why your clients are leaving in first place. Once the problems have been identified, it becomes easy to take preventive measures to stop the customer leakage.
4. Don’t Let Customers Go Unattended
As a business owner, it is important to constantly work on keeping your clients loyal to you. However, majority of businesses tend to focus more on building initial relations with customers and once the sale has been made, they let this relationship go unattended. Due to this, clients feel neglected. They silently walk away elsewhere and you keep losing important customers, without even knowing about it. Therefore, you should always follow up with clients after the completion of each and every project. You should always be around for the client to look up to in case of need or help.
5. Win Back Lost Customers
Bringing back lost customers is another feasible step to improve the customer retention rate. It is better to approach your dormant customers first rather than spending resources and time on generating new ones. Old customers are more likely to be receptive to your efforts than the new clients, as the latter don’t have experience of working with you. For this reason, it is prudent to regain the lost customers before they switch their service provider.
6. Involve Customers and Engage with them
Involving customers in design and delivery of service and other areas of business operations is a long lasting customer retention strategy. You should be open to customers’ ideas and suggestions in order to come up with a customized solution that fits well with their needs. On top of that, inviting customers to company events, picnics, parties and social gatherings, etc. makes them feel valued. Customers love to get associated with businesses that offer them a familiar and friendly atmosphere, one where they can express themselves and raise their business concerns.
7. Enhance Customer Service and Support
No matter how big your business is or how good your products are, customers always remember how well they were treated when doing business with you. The direct interaction that customers have with your company is an important determinant of clients’ relationship with your business. A dedicated and personalized customer service staff, that is readily available for help during any time of the day demonstrates that the company cares about its clients.
8. Improve Your Offerings
In the ever evolving business world, delivering great service to retain customers is not sufficient anymore. You should continue to evolve your offerings in line with industry growth and help your customers stay ahead of the competition. Customers are likely to trust businesses that remain updated with the latest solutions and best practices in the industry. Thus, it is important for you to to keep up with recent developments in business, in order to deliver updated solutions to customers.
9. Work Integrity
Maintaining work integrity promises long term association with customers, based on trust and mutual understanding. Whereas, ethical shortcuts and overpromising may give a bad name to your business, resulting in customer mistrust. As a business owner, you should explain the benefits of ethical conduct to your staff. You need to make sure that your products and services are consistent with your marketing message and promotions. The quality, design and other features of your product or service must be of the same standard as your customers need and expect.
With the help of these tips, you can put your ideas and options in a logical sequence. Instead of constantly working on finding new clients, it is better to take care of your existing customers first. Finding new clients becomes easier when your existing customers are happy with your services.
For more insight from Anand, check out his blog or follow Anand on Twitter @AnandDamanica.
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