Nobody likes calculating their customer churn rate, but it’s one of the most important metrics for figuring out what works for your company and what doesn’t.
If you’re not already familiar, customer churn is the number of customers who stopped using your product or service within a certain span of time. While it would be great if we could all maintain 100% of our customer base, that’s simply not possible.
The goal is to keep your customer churn rate as close to zero as you can — which means you should be keenly aware of what your rate is.
Why is that important? Because it costs more time, effort, and money to get a new customer than it does to retain an existing one. A lower churn rate means higher profits for your company, meaning it literally pays to focus on customer retention as much as you can.
Every customer likes to feel appreciated. One great way to boost your customer retention is to show some appreciation for those who already do business with you, such as with a “thank you” email — even if they’re just responding to a poll or signing up for a newsletter. Of course, you don’t want to deluge them with emails every time they interact with your company (that can get aggravating very quickly), but sending a little note of appreciation to customers never hurts.
Just as customers enjoy feeling like their business is appreciated, they also like knowing that the company is looking out for their satisfaction and well-being. When you close a customer service ticket, arrange to send a follow-up email to make sure the issue was resolved to the customer’s satisfaction and that they’re happy with the solution. Customers do remember this sort of thing, and it can help spread positive word-of-mouth.
Beyond knowing the churn rate for your customers, you should also take steps to learn more about the customers themselves. While it’s simple enough to do this with polls, email surveys, and the like, you can also employ more advanced methods to gather and analyze customer data. For example, you could use automated contact management software to collect details on customers such as their preferences, shopping habits, the frequency with which they purchase, and more. By learning these fine details,
you can more accurately target the customers you most want to keep and market more effectively to them.
A fortunate by-product of building up a database of valuable customer data: personalizing that data in your communications. Using software tools to analyze and segment customers into profiles, you can build campaigns that deliver personalized messages or products to each of those groups. Customer management software can help you gather and organize relevant details on customers, so you can personalize those communications and help your customers feel like they’re known and valued.
If you can help it, you should never give your customers a reason to look elsewhere. If they need a refund or a return, make it as easy for them as possible. If the process involves zero hassle, that may go a long way toward keeping their business. Similarly, introducing perks or reward programs to give a little back to long-standing customers will even further boost your reputation — and your customer retention rates.
As we mentioned before, retaining customers takes less work than finding and securing new ones — but even existing customers might stop engaging after a while. This is why it’s important to figure out who’s engaging with your emails and who isn’t. Again, this is where software tools come in handy. Once you know who’s still subscribed but not really engaging with your emails, you can engage them with a re-engagement campaign.
A re-engagement campaign might be as simple as sending them a “we miss you” email to entice them back, or it might be a discount, freebie, or other more material enticements to get them interested in your product or service again.
This can also be a good opportunity to ask for feedback by using free online feedback forms to find out more about why your customers stopped engaging. This may have nothing at all to do with you — changes in finances, interests, and life circumstances happen, and there’s not much you can do about that. But if there is something you could improve, such as the frequency or relevance of emails, a re-engagement campaign can be a great way to figure out those issues and do something to address them.
The strategies for boosting your customer retention rate in an online marketing effort aren’t that different than in any other field. The object is to make customers feel valued, appreciated, and feeling like they’ve made a great decision doing business with you.