Lead generation is often one of the key areas of any business. It helps to attract new customers to foster growth. The current circumstances of the global pandemic brought with it certain challenges. Customer acquisition has become more difficult than ever.
The outbreak of COVID-19 caused a drastic shift in consumer behavior. For many companies, investing in e-commerce and digital marketing has become the latest trend. Experts foresee that online shopping might remain even after the pandemic has come to pass.
Regardless, businesses should also focus on another vital element: customer retention. Heavy reliance on acquiring new customers can actually prove to be more expensive in the long run. Loyal customers might even spend more than new customers.
Strategies to Bolster Customer Retention
Being able to keep customers is vital to a company’s long-term growth. Considering how the global pandemic has affected consumers, it has become impossible to attract new customers. This has turned the return of current customers into a necessity.
There are countless ways to increase interaction with existing customers. These measures are also more cost-effective than having to attract potential consumers. A business should be able to encourage a sense of loyalty within its existing customer base.
Listening to the Voice of the Customer
Investing in voice-of-the-customer tools is the primary avenue to drive customer retention forward. Having a comprehensive VoC program is an effective way for a company to identify what they’re doing right. This provides customers with an appropriate outlet for feedback.
There are various public platforms that a customer can go on to share their thoughts about a particular business. If they have good reviews, then it’s a good way to generate an organic following. The feedback that highlights negative criticism is best seen and handled privately.
A VoC program will also allow for higher interaction and engagement with customers. This will show returning customers how much a business really cares about them. Taking the time and effort to value customers will definitely lead to higher retention rates.
Loyalty Program Incentives
One of the easiest ways to lose customers is when they feel that there’s no motivation for them to keep purchasing products or services. A great way to combat this is through the creation of a loyalty program. This will help make the customers feel that they are getting the best deals from a business.
Offering various discounts, free trials, and gift cards are some of the most common ways to achieve this. The more incentives a company provides, the higher the chance that customers will continue to stay with them long-term.
Loyalty programs are also a great way for current customers to suggest businesses to their friends. This will most likely turn out to be a win-win scenario for both parties. Businesses are able to boost customer retention and acquisition, while customers get to capitalize on exclusive perks.
Optics and Adaptability
Another way for businesses to boost customer retention is by increasing their presence on social media. Content creation is great for increasing visibility, especially with the rise of e-commerce. Being able to offer relevant articles and webinars will reinforce customers’ confidence in a company.
More than that, products and services should also be catered to address consumer demands. Knowing the immediate concerns of customers will definitely make a business stand out. This is much better than aiming for profits with irrelevant products.
Consider offering products and services virtually as well. This will show appreciation and empathy for customers. The worst thing a business can do is forget about its consumers. Connecting with customers remotely during these trying times is an absolute must.
Importance of Customer Retention
Customer spending is at an all-time low now due to the global pandemic. Coupled with other struggles, managing customer retention now falls on everyone. It’s not a one-person job. Each significant group within a company plays an integral role in encouraging consumers to keep coming back. Prioritizing customer retention will surely aid in a business’s recovery.
Based on reports, a business has a higher probability of converting a sale from an existing customer. This probability ranges between 60-70%. New customers only provide a 5-20% probability of sales. A huge amount of a company’s future profits, approximately 80%, is also highly likely to come from 20% of returning customers.
Repeat customers have been observed to spend at least 33% more than newer customers. This is backed by their trust in a company’s brand, products, and services. In the end, focusing on a customer’s loyalty will prove to have a higher return on investments than acquiring new ones.