There are many customer retention ideas that can be adopted, but there are no shortcuts.
Retention is a combination of the value add of a product or service and relationship building through the customer experience.
There is no “one-size fits all” strategy and every business decide on those ideas that works for them and develop them to implement viable strategies.
Why Customer Retention Matters Especially in Small Business
All businesses desire to retain customers. Studies demonstrate that it is less expensive for businesses to retain customers than only focusing on acquiring new customers.
Without customer retention, a small business will certainly feel the financial pinch a bit more than larger companies.
Customer Retention Ideas Vs Customer Retention Strategies
Individual customer retention ideas are developed into strategies. Strategies on the other hand represent the “how” the ideas will be implemented.
They are the plans and tools that are used by a business to create customer trust, loyalty, and satisfaction during their journey to improve the overall customer experience.
The objective is to build a base of satisfied customers who not only will become repeat spenders but will also refer other customers to the business.
What is a Customer Retention Rate ?
Every business should know and understand their customer retention rate, or CRR. It is the percentage of repeat customers a company acquires over a specified period.
The formula is CRR = ((E-N)/S) x 100
S = Number of customers at the beginning of the specified period,
E = Number of customers at the end of the period, and
N = New customers acquired during the same period during that window.
The output of this formula is then multiplied by 100 to determine the percentage.
8 Customer Retention Ideas to Develop into Strategies for Small Businesses
See Infographic
1. Offer unique services and products
2. Decide to start a customer retention program
3. Build trust with your customers
Trust takes time to develop , so be ready to nurture your customers
4. Develop a good customer communication strategy
The business should be proactive in regularly reaching out to previous customers even if they have not interacted with them for a while.
Re-establishing the relationship ensures that the brand remains top of mind for the customer.
5. Create a good onboarding experience for new customers
First impression of a new customer is important as it sets the foundation upon which the relationship will be built.
6. Try to provide personalized customer experiences
Customers do not have the same needs, so providing custom solutions may be necessary. You want to avoid providing one-size-fits-all solutions for customers needing products and services
According to a Salesforce report, 99% of marketers stated that personalization promoted an enhanced customer relationship, while 78% claimed that it had a great impact.
7. Build Customer Loyalty through shared values
When customers understand and relate to your values, it helps them identify with you and feel connected.
8. Frequently Ask for Feedback – Customer Retention Ideas
To retain customers, you will need a process for customer feedback no matter how unpleasant it may be. This is where some businesses miss it by being dismissive of incidents and customer complaints.
The voice of the customer will actually help improve customer processes because it is usually negative feedback that is more important.
Conclusion
There are several customer retention ideas that a small business can choose from to develop strategies. Retaining current customers is less expensive than acquiring new ones.
Customer retention is important for business growth and sustainability.
References
Moore, K (2022) What Is Customer Retention + 16 Proven Retention Strategies https://www.helpscout.com/blog/customer-retention-strategies-that-work/
Matthews T & Bottorff C (2022) 14 Customer Retention Strategies That Work In 2022 https://www.forbes.com/advisor/business/customer-retention-strategies/
Marketing Cloud Personalization https://www.salesforce.com/products/marketing-cloud/customer-interaction/
