Focusing on customer retention is one of the quickest and easiest ways to boost your business results. While it’s easy to get excited by large orders, the true long-term benefit for your small business comes from gaining repeat sales from your existing clients. In marketing terms, this means increasing your customer retention rate.
Did you know that nearly 65% of business typically comes from existing clients, and that increasing your customer retention rate by just 5% can result in a 25% profit increase?
Keeping a consistent customer retention rate can be a challenge, but there are numerous techniques you can try to see what works best for you and your business. While this may sound time-consuming, it’s well worth the effort.
Focus Areas to Improve Your Customer Retention Rate:
1: Your Team
Develop your core values, vision, and purpose, and consider making this a team exercise. Regular one-on-one reviews and feedback sessions with your team can build a continuous improvement mindset. Encourage feedback on how the business could be improved.
2: Feedback
Implement a sales follow-up process to secure feedback after deliveries or completion of work. Regular contact with customers shows you care, provides value, and introduces new products or services. Review and improve your customer experience across all interactions, including your website, social media, emails, and letters.
3: Offering
Focus on continuous improvement of your products and services, and clearly communicate these improvements to your customers. If you’re already asking for regular feedback then you could also ask your customers what else they might want or need.
4: Community
Be active at social events, on social media platforms, and through added-value website content like blogs or downloads that address customer problems. Promote testimonials and case studies to strengthen your authority and ability in your field. Manage customer expectations so you can consistently over-deliver and delight.
5: Rewards
Develop a customer loyalty program and consider schemes that reward additional purchases. Sending Christmas cards or gifts to clients can also go a long way in building loyalty.
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Did you know it costs up to six times more to win a new customer than to sell to an existing one?
So, while marketing to attract new business is essential, focusing on your existing customer base can provide significant benefits and create the stability needed to grow your business further.
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In addition to customer retention, you can also consider:
Lead Generation
Lead Conversion Rates
Transaction Frequency
Transaction Value
Business Costs & Overheads
If you’re ready to put these principles into action, outline your goals, measure progress regularly, and keep the momentum going.
It may take up to 12 months to see substantial changes, but the consistent effort will pay off in increased profitability.
For additional support and to discover how we can assist you in improving your customer retention and building a bespoke plan, get in touch here.
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