What if you were told you were spending five times more money on something than necessary? Certainly, almost anyone would quickly remedy that situation. After all, financial-savviness is an important pillar of running a successful organization.
However, some business owners don't realize that they may be in a similar economic position when it comes to their marketing plan. In multiple studies, Forbes found that it costs five times more to acquire a new customer than to keep an existing one. On top of that, current customers are up to fourteen times more likely to make additional purchases later on.
Clearly, customer retention is just as important as gaining new shoppers. By reducing customer turnover, you increase your revenue exponentially. So let's discuss five simple business strategies to reduce your customer churn and increase your bottom line!
1. Create Opportunities For Communication
You cannot have a solid relationship without proper communication. So, if you want to create a bond with your customers and ensure their loyalty to your brand, you must take a proactive approach to conversation.
A great way to communicate regularly with your consumer-base is by utilizing email marketing. Taking note of your overall audience demographic, share relevant updates, milestones, tips, or short stories. Make your customers feel appreciated and their perception of your company will improve.
As a business owner, don't overlook the power of social media. Responding to comments and reposting customer photos of your products helps to humanize your brand. These simple connections make your buyers feel more connected to you on a personal level, rather than as a daunting corporation.
Then, when customers feel connected to you, they are less likely to leave your brand, ultimately helping reduce your customer churn.
2. Gather Feedback To Reduce Your Customer Churn
Asking for feedback is a great way to show that you care about your customers and how they feel. This provides an opportunity for buyers to share with you their concerns and ideas. It also keeps customers engaged, and when your brand name is on their mind, they are more likely to return for your product or service.
However, in addition to asking for feedback, listening to the responses you receive is essential. This is a twofold process, both of which are necessary to increase customer retention.
First, obtaining positive feedback shows you why customers want to come back to your company. This proves the success of current methods, and pave the way for further similar strategies.
Second, a review of the more critical feedback highlights weaknesses that are leading to customer churn. Deciphering precisely what is turning customers away helps you implement necessary modifications. Negative feedback also offers a great opportunity to reach out to an unhappy customer. Doing so in a polite and personable, yet professional manner can win back a customer who may have been on the brink of churning.
3. Identify Your Customer-VIPs
Maybe they have spent the most money. Perhaps they are the clients with the most longevity at your company. Or, maybe they have referred numerous friends. It doesn't matter how you track which return-buyers are your Very Important Purchasers, but doing so is an important way to reduce your customer churn.
Once you have your group of VIPs, you can glean great insight into why they are so loyal to your brand. Ask questions such as:
- What actions did our company take when these VIPs became buyers?
- From where were these VIPs referred to my company?
- What initial product or service was purchased?
- What products or services have these customers purchased since?
The answers to these questions will highlight what is needed to continue converting future one-time buyers into potential VIPs.
4. Offer Incentives To Retain Current Customers
Studies show that 90% of shoppers trust a recommendation from a friend more than anything else. So, why do all of the marketing by yourself, when you can incentivize your customers to do it for you?
Institute a referral program to encourage your customers to invite their friends. Most programs reward according to the quantity of referrals, which shows your customers that you value their efforts. Of course, when your customer feels valued, they'll be more loyal to your company.
Offering sales, discounts, or exclusive access for company ambassadors is another great way to increase brand loyalty. Plus, 65% of business comes from existing customers, so why not reward them for it? Since the process does result in acquiring new customers, this is an investment that pays for itself.
Make sure to market your incentive programs especially well to your VIP-list, discussed in the previous heading. Since these customers have an established brand-loyalty already, there is a high probability of their participation.
5. Reduce Churn With Better Customer Experience
Failing to provide adequate customer service is one of the leading reasons for customer churn. Therefore, providing an above-average experience for every customer will ensure their return to your business.
Constantly review your website to make sure everything is simple, organized, and relevant (or ask us to do so!) Test your methods for speed and efficiency. Make sure to respond to all customer inquiries as soon as possible, or at least with a friendly, helpful automated message.
These days, with so many online businesses, is it essential to give your customers a bit of "human touch." Don't forget the little things that can help your company stand out among the crowd. Reach out to customers personally with a phone call, or leave a handwritten note in some packaging, if applicable.
Go above and beyond in every step of the process, and see how your client-base grows.
Reducing Customer Churn Is Simple
Customer turnover is a natural element of the business process. However, implementing these simple methods can help you drastically reduce your customer churn. You'll watch as your client retention - and your bottom line - grow together.
