Customer Retention Programs Help You Keep What You’ve Earned
At the heart of demand marketing is creating demand to bring customers to you. Customer retention is one excellent way to do this; after all, keeping a customer is essentially the same as bringing her back to you, over and over again. Research by the Harvard Business School found that increasing customer retention by just 5 percent can increase profits by 25 to 95 percent. Crazy, right? Well, not really. Depending on your business model, a one-time customer could use your products or services twice more or two hundred times more, as long as they’re happy with your service.
Although many factors play into keeping a customer loyal year after year, customer retention programs usually focus on that: service. Figuring out how to provide the best possible customer experience by deepening relationships and ensuring consistent satisfaction at every stage of the product cycle will keep your important people coming back year after year.
What Is Customer Retention?
At the most basic level, customer retention is a pretty clear concept: keeping customers around and loyal. However, the idea gets a little more complicated when you add in measurement, which is crucial for a well-oiled customer retention program. If you don’t know why people stay and what you do that makes them want to stick with you, then you cannot repeat your success with the next customer. Therefore, a quality customer retention program incorporates metrics of success with a solid assessment mechanism to produce valuable insight into keeping your customers loyal.
The Net Promoter Score
Believe it or not, there is actually a very simple way to figure out how likely a customer is to stay with you (not to mention to send you business), and that’s the Net Promoter Score, which you have no doubt seen it in some form or another. It asks the simple question:
On a scale of 0-10, how likely are you to refer us to a friend or colleague?
You can change the verbiage as you like, but using this simple question on a customer survey will tell you exactly who is promoting your business, sitting in referral limbo, or actively working against you. If a customer answers 9-10, for example, they are loyal and active in helping you build your business; they tell others how much they love your product or service and consistently return for new products and services (think diehard Mac users). If they reply 7-8, they aren’t taking any action. If they come in at a 0-6, however, watch out: They might try to take you down.
Numbers, Numbers, Numbers
Of course, the above is just one example of a customer retention program, but it demonstrates how you can use hard-and-fast numbers to determine a customer’s likelihood of sticking around and helping you build your brand and your customer base. No matter what numbers you use, however, they must measure a wide cross-section of your customer base so you get an accurate reading on what works and what doesn’t. Identifying where you’re already proficient and where you can do better will help you hugely in your effort to build a seamless customer retention machine.
It doesn’t stop with numbers, of course. You must base these numbers on something measureable that you are doing to keep the customer loyal: providing excellent customer service, educating them on how to use the product, offering incentives or exclusive opportunities, providing above-industry-average guarantees, or simply providing information they can’t get anywhere else.
If you’re unsure how to choose or measure metrics, call in the pros: MarketBlazer is always happy to help. A detailed, reliable, repeatable customer retention program is at the heart of building a solid demand marketing machine, so ask us about getting started today.
If you’d like to learn more about how a Customer Retention Program can help you keep more of your existing customers coming back, call MarketBlazer at 770-893-2443, or connect online.