Looking for business growth ideas? When it comes to growing startups, many businesses are so focused on gaining new customers that they fail to address the need to retain those they already have.
Gartner says 80% of your future profits will come from just 20% of your existing customers. That means revenue sources you’ve been trying to find are likely sitting under your nose. They just need to be nurtured and cultivated.
Before we move to tips and strategies, let’s briefly review – what exactly is customer retention and how is it linked with customers’ success?
Why Customer Retention Matters?
Customer retention usually describes a company’s ability to retain its customers for a long time. Hence, customer retention programs are a part of the overall strategy that strives to identify and eliminate the reasons for why people stop buying from your company — while at the same time developing the incentives to make them stay. Data is very important in this ‘identifying the reasons and incentives’ process. Starting from the very first purchase, marketers analyze the whole purchase journey and the purchase history of their buyers to come up with the best customer retention programs.
Now, when it comes to customer retention programs, there are quite a few types of them, including the customer loyalty programs, the onboarding programs, referral programs, and so on. But they all come down to ensuring a couple of fundamental things:
- Boosting your brand awareness so that the customers know what you can help them with and how they can get your help
- Building trust between your customers or buyers and your company
- Ensuring they benefit from your partnership – meaning, ensuring customer success.
Customer Success vs Customer Support
Customer support mainly deals with answering customers’ questions, solving their issues, answering phone calls, chatting on social media or via chatbot. Basically, this is the business function that solves the customers’ problems. In fact, a customer support team is a small portion of the whole customer success process.
Customer Success is a customer-based approach to successful long term relationships between the business and its clients. Customer success maximizes customer happiness and increases customer loyalty and sales.
While customer support teams usually take a more passive stance and provide their help upon request, customer success teams focus on building trusting business relationships with the customers. This requires more proactive communication with customers. Customer success teams help your customers or buyers receive the most benefits out of your products or services and maximize the value that your company offers.
Your customers’ success is important for your company’s success. If you help your customers succeed by properly utilizing your products or services, you will get loyal, long-term business partners and evangelists.
Recently it has become very popular among companies to hire customer success managers. The main role of a customer success manager is to build productive relationships with customers. This includes the following responsibilities:
- engaging with customers on a regular basis
- helping customers get the most benefit out of your products or services
- getting feedback from customers on how they are using the product or service, what they think about it, and if they would recommend it to a friend
- leading customers through the customer success journey
- analyzing the data that your customer success managers get from portfolios and feedbacks in order to make better recommendations for future purchases
- Identifying customer needs and helping customers achieve their business or personal goals on the road to success.
As it was already mentioned, as a part of their job customer success managers gather feedback from customers. It is an important step in each customer success strategy as it can show you how to improve the services that you provide.
The majority of companies have a customer service support team that is responsible for answering customers’ questions or solving the problems that your customers face. Usually, they do this over the phone or via online web forms. However, the studies have shown that for each customer who complains there are 26 customers who don’t, even if they face the same problem. These people will just stay dissatisfied and will probably not buy from you the next time. So in order to avoid a situation like this, it’s better to invest in some preventive measures – and customer success strategies will help you do just that.
Five Customer Success Strategies for Your Business
Here’s a look at five customer success strategies for businesses and entrepreneurs.
Customer Success Strategy #1. Monitor Customer Lifecycle and Take a Genuine Interest in Making Your Customers Successful
If you want to achieve multiple sales and have your customers always come back to you, make sure you’ve built an effective customer lifecycle. It means that you need to start paying attention to your customers from the very beginning and never lose interest in them.
Not everyone focuses on this. Many businesses get wrapped up in being too product or sales process-oriented. Take time to map out what successful customer experiences look like. This could include a roadmap, diagram or workflow. Inkit integrates with CRMs and applications to help you automate this task. Your objective is to help your customers succeed. If you do this, good things will follow.
You can upload your databases into Inkit’s CRM system to trigger highly targeted postcards at the right moment. With a possibility to segment your direct mail audience based on demographics or customer data, you can personalize your direct mail campaigns and at the same time retain your old customers and reach the new ones. Just upload CSV files or integrate lists from CRMs such as Drip, HubSpot, Sailthru, or Iterable and your direct mail campaign carrying a special personal touch is ready to be launched.
Customer Success Strategy #2. Never Underestimate the Value of Customer Retention
Loyalty is the result of a customer’s positive experience from a purchase at your company. If you want your customers to be satisfied and stay with you, invest in their trust in your business. Create a loyalty program for your most trusting customers. There are a number of ways how you can build customer loyalty for better retention rates.
According to Bain and Co., a 5% increase in customer retention can increase a company’s profitability by 75%. For first time buyers and loyal customers, reward them with a special offer or note thanking them for their business.
For better personalization, try Inkit’s custom template builder. You can choose different fonts and colors for the postcards you plan to send. You can even upload your own backgrounds and images to make it more similar to your other campaigns and ensure smooth cross-channel experience. It’s very easy to do: you just drag and drop the files you want to include and your direct mail piece is ready.
Customer Success Strategy #3. Over-Invest in Customer Success
Lee Resource Inc. found attracting new customers cost 5 times more than keeping an existing customer. Poor reviews, bad orders, and other customer support tickets are something most businesses try to avoid, but inevitably happen. Sending a postcard offers a second chance at rekindling that relationship. A thank you, apology, or special offer on their next purchase improves the success of maintaining customers.
Customer Success Strategy #4. Measure and Track the Numbers
Test and measure the approach you’re taking. You can even set up postcard A/B testing to see what copy and content performs best. Some key customer relationship engagement metrics to track are:
- Renewal rate by revenue
- Renewal rate by customer
- Gross retention
- Net retention
Net retention will tell you the most about your customer success strategy. However, just like the sales process, keep track of the other numbers and evaluate where potential weaknesses exist.
Customer Success Strategy #5. Marketing Relevant Promotions
Promotions are an excellent way to retain customers and keep them actively engaged with your brand. The trick is to reward customers, care about customer success, and make them feel good about doing business with your company. This will keep them doing more business, over and over again.
Postcards offer a more personal touch. Sending customers a special note once they’ve purchased a certain amount, or sending inactive customers a reminder are important. It will help improve customer retention, grow order sizes, and increase order frequency.
Companies that actively communicate and pay attention to their customers win by achieving higher brand loyalty.
Having a customer success strategy is an important step to understanding your customers and building an effective customer retention program. Facing huge competition in every marketplace, your task is to build a proper customer success strategy to stay competitive.
You must daily challenge your company to understand the needs of your customers and look for ways on how to help them achieve their own success. Try using different ways of interacting with your customers and you will definitely find a way that will work for your business and your customers best.
- Use Inkit’s A/B testing in order to see which strategy to use for different segmented audiences.
- With the help of automated direct mail software, you can target customers who have been inactive or offline with just a few clicks. For example, try to win back your customers at the mailbox with a promo, gift, or a reminder of their store credit.
- In today’s digital world, direct mail is considered to be more personal as it builds more trusting relationships with your customers and leverages your brand awareness. According to the DMA’s 2015 Response Rate Report, the median response rate for direct mail advertising sent to house lists was 3.73% in 2014.
One may think that sending direct mail is a thing from the past, as well as a very tiring and long process. However, this process can be easily automated. Inkit’s direct mail automation software will make the whole experience a breeze for you, with no special efforts or long dedicated hours needed.
You can easily integrate your databases into Inkit’s system, design a postcard in a few clicks and press the send button. Then you just wait for results and analyze them to improve your future direct mail marketing campaigns.
Schedule a demo with Inkit Today and Start Cultivating Your Existing Customers!