Did you know that 68% of lost customers never go back to the same provider again?
The same Accenture study also found that 80% of these customers felt that their provider could have done something to prevent them from leaving.
Lost customers can have multiple negative impacts on your business. For one, it takes a lot more time and effort to acquire new customers than to retain them. In fact, studies have revealed that it costs 5X as much to acquire new customers than to retain existing ones.
But even apart from these costs, lost customers can affect your reputation and credibility in a big way. 44% of disgruntled customers admit to venting on social media about their negative experiences with your company.
Here are some new ideas on how to build customer loyalty and take your customer retention up a notch:
1. Improve Your Offers by Partnering with Another Brand
A study by Salesforce found that 63% of consumers expect businesses to frequently offer new products or services.
The same study also found that 56% of customers are eager to buy from companies that base products on consumers’ changing needs and preferences.
It isn’t all that simple, however, to constantly innovate and create new, profitable products. An easier alternative to this is to partner with other businesses and develop co-branded deals that enhance your existing offers.
It’s best if gain a better understanding of your customers’ everyday lives and purchase processes, when considering which co-branded deals are most beneficial for them.
Credit card companies, for instance, partner with top retailers and restaurants so their customers have a chance to rack up points or earn rewards for using their cards.
American Express loyalty program members can use their points to pay for purchases at Walmart, Best Buy, Amazon, and more.
Image via American Express
Another great example of this is from Pottery Barn. Pottery Barn partners with multiple businesses that provide home installation services, party planning, and even wedding registry.
This makes it convenient for shoppers to connect with reliable installers or planners after purchasing from their online store, and simplifies the post-purchase process.
2. Share Personalized Recommendations
Research by Boston Consulting Group estimates that by 2022, personalization will move roughly $800 billion in revenue to the 15% of businesses that get it right.
An understanding of buyer preferences can help you reach out with product recommendations that are likely to be more relevant and useful to you audience. In fact, 70% of consumers have reported that it’s necessary for brands to understand how they use the products in order to win their business.
Take your product recommendations up a notch by sharing “how-to” guides that illustrate how these complementary products can be used with ones they have already purchased.
For example, J.Crew shares personalized recommendations with their customers where they showcase how certain products can be put together to create the perfect ensemble. If a customer has purchased their leopard print skirt, the following recommendations are likely to spark their interest.Source
3. Gamify Your Loyalty Program
Loyalty programs are one of the most popular retention strategies used by businesses. Gamifying your existing program (if you already have one) can better engage your customers and entice people into making repeat purchases from your brand. A study found that 181% more retailers have expressed an intention to gamify their loyalty programs in the next five years.
How can you gamify your loyalty program?
- Start by adding multiple tiers within the program. Customers will need to make a certain amount of purchases to qualify for each tier, and each will offer them a unique set of benefits. This is one of the most common techniques of loyalty program gamification that many brands use.
- Provide a suitable reward for different actions to encourage customers to participate. This could be anything from purchases and referrals to social shares.
- Make it easy to track progress through visual progress bars. Your customers should be able to see which level they’re currently at and how close they are to reaching the next one. Such milestones can encourage them to make impulse purchases to move ahead in the program.
- Make it fun with lots of visuals and befitting copy. You can add a fun element to the name of the program, the title of each tier in the program, each rewarding action, and the explainer page.
A great example of loyalty program gamification is from the SkullSplitter Dice Adventurer’s Guild. They’ve provided a fun name to the loyalty program and as you can see in the screenshot below, each rewarding action has an interesting name and illustration.
4. Build a Strong Social Media Community
A study published in the International Journal of Research in Marketing found that there was a correlation between social media use and positive brand relationship quality. When brands engage with customers through social media, they experience an improvement in consumer-brand relationships.
But you need to do more than simply promote your brand on social media. You can create a Facebook group or page and start building a strong social media community of your most loyal customers and entice others to participate as well.
Encourage community members to share their stories about using your products along with pictures and videos. Ask them to share reviews or tips and tutorials to help others. By doing so, your customers will be able to connect with your brand and other community members.
You can also create a hashtag to bind these conversations together. Encourage your customers to use it whenever they post in the community. You may even stumble across some eye-catching social media content as well.
Here’s an example from ASOS:Image via Facebook
You can even go the Taco Bell route and create a social media community around people’s love for your brand. The restaurant chain’s Twitter account shares relevant content created by customers and publishers alike, bonding over their love for satirical humor and Taco Bell.
Some people share photos of their Taco Bell weddings and birthday cakes, while others even get tattoos of the brand. Publishers like BuzzFeed have created quizzes related to the chain, which Taco Bell then shared with their fans.
Some fans, such as Ted Berg, have even written poetry about one of the Taco Bell menu items. The sassy responses from the Taco Bell Twitter team helps keep the community together.
Image Via Twitter
The most important thing to remember when you create any retention strategy is that you need to understand your customers’ needs and preferences first. Insights about their past purchases, interests, demographics, and preferences can help you effectively segment your customers, which is the key to creating effective retention strategies.
Have you used any other retention strategies to build customer loyalty? Feel free to share them in the comments below.