Understanding how to increase customer retention is one of the biggest factors in ensuring your venture’s success. When starting your own business, it’s more cost-effective to sell to existing customers than it is to constantly focus on acquiring new ones. 

We’re here to provide you with several customer retention techniques to help you build  your loyal customer base. 

There are numerous benefits to this strategy. Not only will you have an easier time selling to existing customers, but you’ll also turn customers into brand advocates, who will naturally spread word of your services to gain you new business. 

In this article you’ll learn how to:

  • Create a feedback loop
  • Set up a customer loyalty system
  • Produce a newsletter
  • Run customer onboarding programmes
  • Show social responsibility
  • Thank your customers
  • Offer support

7 effective customer retention strategies

  1. Create a feedback loop

Asking customers for feedback is a simple yet effective way of increasing customer retention. It needn’t be complicated or overly technical: think focus groups, online surveys, product reviews and newsletters. Once you’ve gathered data on how a sample of your customers feel about your business and services, analyse their responses to look for areas of opportunity. Focus your efforts on working on any weak points revealed, and look to improve the customer experience. When you’ve successfully implemented your customers’ feedback, ask them for further feedback and begin the process again to continue honing your service or product.

  1. Set up a customer loyalty system

 Rewarding customers who use your services repeatedly provides an extra incentive for them to return. Giving something back to people in return for using your product or service  makes them more enthusiastic about your company. It may also increase the likelihood they’ll return and perhaps spread a good word about your business. It’s worth it: there’s only a 13% chance of a potential customer purchasing your product of service. When it comes to a repeat customer this rises to 60% to 70%. New customers will cost you five times more in acquiring than holding on to your old ones. It pays to look after your customers!

  1. Produce a newsletter

 Another powerful way of retaining customers is to send regular newsletters. Alongside a regular newsletter detailing deals, new products/services and customer incentives, you can set up automated emails to be sent on customers’ birthdays and on other significant dates, or even a certain amount of time after they’ve made a purchase. Keep it fun, fresh and as personalised as possible. Email automation programmes such as Mailchimp make this super easy.

  1. Run customer onboarding programmes

If your business provides services or products to a customer which they’ll have to learn to use, create an onboarding programme (gradually showing the customer everything your company has to offer) to walk them through the process. By teaching the customer everything they need to know about your product or service, you’ll save them time, show expertise, and establish a personal connection. By showing your customers how your products work in detail, you’ll increase the likelihood of receiving great reviews.

  1. Show social responsibility

A less direct method of increasing customer retention is to project a socially responsible image for your brand. Things like taking steps to offset your carbon emissions, using recyclable materials and supporting charitable causes on social media all work to show  customers who you are and what your values are. When starting a business it’s important to be consistent in your marketing and show integrity to attract loyal customers. 

  1. Thank your customers

Giving thanks to your customers – either in a message or by rewards – encourages a feel-good response surrounding your brand which may increase customer loyalty. When starting a business, building a brand that’s memorable and likeable is crucial – and expressing gratitude towards your customers is another step forward to achieving this.

  1. Offer support

Sometimes things go wrong. This needn’t be a problem when handled strategically; mistakes can be positive for your customer retention strategy. For example, if a customer is having trouble with one of your products, you have a chance to show your professionalism, diligence and know-how by helping them resolve their issue. By handling customer enquiries swiftly, you can turn what might otherwise have been a negative interaction into a positive. 

Customer loyalty can play a big part in making a business successful. If you implement the above customer retention strategies when starting your own business, you’ll already have a great framework in place to make sure that your customers or clients stick with you. 

When you are getting your customer retention strategies in place, it’s also important to keep on top of your business finances. Countingup is designed to help small businesses save time and money and is a trusted financial tool for over 34,000 self-employed people. Find out more here.