In this post, we outline 5 ways to retain customers and build long-term relationships.
If you want your company to survive and thrive in an ever-changing market, you need to focus on customer retention. It is often said that one dollar spent on retaining an existing customer is worth twice as much as a new customer acquisition - this is because the probability of selling to an existing customer is 60–70%, while for new customers it’s only between 5-20%. However, it's not easy to keep each and every customer happy. You must offer them something that makes them want to remain loyal to your products or services. In this post, we outline 5 ways to retain customers and build long-term relationships.
The importance of customer service cannot be understated. Despite it being common knowledge, many businesses do not spend enough time or resources to ensure that customer service becomes a competitive advantage. Over 80% of customers reported that they would be willing to pay more to get a better experience.
Customer service can take many forms. One example is offering seamless omnichannel customer support across all parts of the customer journey. Customers might have questions they need answering before finalizing their purchase, or they may have technical questions about how to use a specific product or service once purchased. Alternatively, they may simply for looking for support or advice to find the right product. Whatever the customer is looking for, ensuring that there is omnichannel support meeting the customer where they really want it demonstrates that you care about the customer and value their business.
It is important to remember that customer service does not end at check-out. That is just the beginning. You should prioritize customer service in all interactions with the customer and look for ways to differentiate. A great example of this is engagement - nothing makes a customer feel more valued than when you ask for feedback and ways to improve. This helps to build trust between the customer and your company.
Customers interact with brands across varied channels, including email, phone support, and, increasingly, AI-powered chatbots. Many businesses do not consider the positive impact of consistent, personalized communications across all platforms and miss an opportunity to build relationships with consumers. To win customer loyalty, try to personalize customers' communications at every step, and by every channel.
This can range from simply addressing your customer using their name (bonus points if you ask for a ‘preferred name’) to remembering and addressing birthdays or other big occasions that are relevant. Surfacing and bundling relevant discounts, highlighting any special promotions that might be of interest to customers, or just customizing the interaction in a way that will be valued by the customer are great ways to stand out as a brand. Personalizing communications and marketing makes customers feel valued, which in turn helps to promote return customers.
One of the main reasons that existing customers don’t return to a brand is due to a lack of continued interest. Brands that do not build a connection with customers do not stay at the forefront of thinking and are often forgotten about after the initial purchase.
Social media has changed the expectations of consumers. Not only is social media important for finding new customers - with over half of consumers learning about new brands on social media - it is imperative to retain customers and build long-term relationships. 68% of consumers agree that social media enables them to interact with brands and companies and nearly 4 in 5 customers are willing to buy from a company after having a positive experience with them on social media. An engaged social media strategy is as important for a small, local store as it is for a large multinational; any business without a social media presence is going to struggle to connect with customers in the same way.
The plethora of social media options is enormous but ensuring and applying a consistent branding strategy across the various platform is important. You should prioritize the platforms you think are most important, considering the type of brand you are building and how that resonates with your target audience. Many businesses also use social media to build an online community where customers can connect with each other.
Offering loyalty programs is a tried and tested way of encouraging repeat business and building long-term relationships, but they need to be designed properly and not annoy customers. You need to create something that is valuable, memorable, and worth customers’ time.
Loyalty programs take many shapes and sizes but with so many programs in the market today, it is important to stand out for the right reasons. In 2022, US consumers belonged to nearly 17 loyalty programs on average but actively used less than half of those. So how do you make sure you end up in the actively used category? Injecting brand personality into the program as well as offering rewards for engagement-related activities (e.g. rewards for actions that are not purely transactional) can help you stand out from the competitors. Simplicity is also paramount for earning points - do not make the points system too complicated or customers will not understand the benefits of collecting points.
Other examples that brands use include sending customers gifts, celebrating customers with recognitions and “thank you” notes, collaborating with other businesses, inviting customers to test new products and services, and hosting company events. Engagement is key in designing a loyalty program that will win.
In addition, the best way to attract new customers is from existing loyal customers. The more someone hears about your brand from others, the more likely they are to consider your brand for their next purchase. But getting that word of mouth isn’t easy. As well as actioning the recommendations in this article, you should also implement a referral program to reward customers who are willing to advocate on your behalf. This will often be cheaper than trying to acquire customers via other channels and often leads to higher-value customers.
Offering insurance provides additional comfort and protection to the consumer, as they can purchase the item, safely in the knowledge that the moment they start using it they are fully protected.
Our research suggests that 60% of consumers inquire about insurance when making purchases in product categories such as engagement rings and eBikes. By providing insurance, both at checkout and during the lifetime of the product, merchants can streamline the consumer experience, increase the purchase conversion rate and maintain the link to consumers during the lifetime of the product.
An insurance claim provides an opportunity for the retailer to delight customers with the experience since most claims can be routed back to the original retailer for repair or replacement. The claim routing itself helps to facilitate further interaction with the customer but providing a great experience during this step helps to reaffirm the brand in the consumers' minds.
Retention is key to any marketing strategy, whether you're a small business or a big corporation. The "Rule of 100" says that every 10% increase in customer retention can boost your profits by up to 100%. With retention being so important, you should use every means necessary to build long-term customer relationships. And there are lots of ways to do that – whether it's through leading customer service, personalized marketing, engagement on social media, loyalty programs, or product insurance.
Find out how Oyster can help you retain customers by scheduling a demo today.
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Today, we are thrilled to announce a significant upgrade to the jewelry insurance offering available at Oyster.
Oyster unlocks coverage options for theft, loss, and damage to enhance customer experience and boosts revenue for Aventon dealers.