Customer retention is on the minds of small and medium-sized businesses across the world. With rising customer acquisition costs, businesses need to innovate and assume a proactive role in retaining clients.
Studies have shown that acquiring new customers can cost as much as five to seven times more than simply retaining existing ones.The fact that customer profitability tends to increase over the life of a retained customer is added incentive for businesses to allocate more resources to sharpening their customer retention strategies.
The following customer retention strategies will give you some inspiration and practical examples to help you improve your customer retention rates. They provide you with actionable tips you can implement today to maximize your customer retention.
- Set customer expectations
The first step to building better customer retention is to set client expectations early. The earlier the better. Don’t wait.
A great way to foster loyal customers is to “under promise and over deliver” on the expectations you originally laid out in the SLA. For instance, if you promised your customer response inone hour. In reality, the response time on those tickets is closer to 30 minutes.
By setting expectations early that are lower than you can provide, you can eliminate uncertainty as to the level of service you need to offer to ensure your clients are happy.
Clients tend to remember negative experiences. So if you have over delivered on the past 20 occasions, but, once, you undelivered, your client will no doubt quote that negative experience as a reason to cancel his or her contract with you.
- Be the expert
Small and medium-sized businesses are becoming more and more dependent on services to run their operation. No matter what industry you occupy, if you can be the expert in your particular field, you will likely retain more customers.
Becoming your customers’ trusted advisor will build customer loyalty and reduce customer churn. If you were an IT Company, you should aspire to be the technology guru. Then your responsibilities will transcend the bare minimum your contract entails. If a customer wants advice on the most suitable mobile phone, you better be ready to assist that customer in choosing a device.
Becoming a trusted source on all technology, you build a relationship that leads to a dependency. Your customers will trust you, rely on you to give the best advice, and recognize you as an integral part of their business success.
Give your clients a quick courtesy call, inform them of upcoming changes and provide some insightful recommendations as to their best plan of attack. This proactive, personalized approach will bolster customer loyalty and render other customer retention strategies more effective.
Being a trusted adviser takes time and a real focus on becoming an integrated part of our client’s businesses. We want to be their one stop technology advisor and that means you have to be comfortable from helping them with everything right from their new mobile phone, to scheduling and running strategic IT meetings.
- Build trust through relationships
As the age old saying goes, you do business with people you trust. Trust is essential in business, and building relationships with clients will garner that trust.
Cultivating shared values means taking an interest in your clients and their business. Do some research on their business, understand how you play a role in their day-to-day activities, and use this information to strengthen your relationship. A good way to start is by asking one simple question the next time you stop by for a quarterly check-up.
“What differentiates you from competitors?” Once they answer, remember that and make a note to do some extra research and find ways that you can assist them with strengthening that point of differentiation through the services you provide. Give them a follow-up call the next week and let them know what you came up with. This shows you have a shared value and are genuinely interested in their business.
Simply providing a service is no longer sufficient, as competitors enter your market, you need to start building shared values with clients and showing you take an interest in them and their success.
- Implement anticipatory service
Anticipatory service is a proactive approach to customer service. Instead of waiting for problems to occur, a company that implements anticipatory service can eliminate problems before they happen.
To achieve and maintain this harmony, today’s companies must establish a dialogue with customers that shows an awareness of their information needs and respect for their communication preferences. The more contacts made with a customer, the “stickier” that customer becomes. When customers are consistently given valuable information, this stickiness can form a durable bond of loyalty.
So you have a client who hasn’t had any problems for four months. Everything is running smoothly. Your tech guys’ setup was perfect, and there have been no dramas since. Instead of just playing the waiting game, you should schedule an on-site check-up. Have one of your guys check in with your client to see if everything is running smoothly and double check that the processes you set up earlier are all still in place.
By being proactive, you can save yourself a lot of reactive problem fixing in the long run and build the perception that you are the type of company that consistently offers ‘anticipatory service’ with your customers.
