Customer retention is a measure of customer loyalty and refers to how well a brand or company can keep its customers returning over time. High customer retention rates mean that a majority of your customers are repeatedly choosing to purchase your products or services, deepening their relationship with your brand as they climb the customer loyalty ladder. Retaining customers may mean convincing them not to defect to a competitor or keeping them engaged with your brand, product, or service to prevent lapse and churn. Businesses use a variety of customer retention tactics and strategies to encourage customers to return, including customer relationship management, customer loyalty programs, loyalty offers, and rewards.
Build customer trust and long-term relationships
Fostering customer trust requires a strategic focus on every aspect of the customer experience. To build lasting relationships, deliver relevance and value at every stage of the customer journey.
Create a robust customer loyalty program
Maybe your brand already has a loyalty program, but you’d like it to deliver better ROI. Or, perhaps you’re just expanding your retention efforts for the first time. Either way, an effective loyalty program should contain these three elements at a minimum; rewards, greater benefits for more valued customers, target offers.
Leverage your customer data
Many lists of customer retention strategies mention the ubiquitous customer feedback survey—but to retain customers successfully, you need to understand their preferences and motivations without always having to ask. Collecting and mapping customer data like transaction histories, customer service interactions, and loyalty program data will help you prevent churn and identify where the wants of your customer intersect with your business objectives.
Re-engage customers using marketing automation
Today’s marketing automation technologies can take on entire marketing processes to simplify workflows for marketing teams. Re-engaging customers is just one of these processes. Instead of your marketing team needing to track which customers have lapsed, a marketing automation solution that uses AI and machine learning (ML) can automatically recognize when customers lapse and re-engage them with personally relevant offers.
Measure customer lifetime value
Customer lifetime value (CLV) is an estimate of the net profit attributed to your brand’s future interactions with a customer. Understanding CLV can enable you to shift from a short-term business strategy focused on the next quarter’s profits to a long-term one that values ongoing customer relationships.
Personalize your offers and communications
Beyond simply putting the customer's name in an email subject line, use the customer data you’ve collected to make your marketing offers and messages more personally relevant to your customers.
Surprise and delight with gamification
“Surprise and delight” has become something of an overused buzzword—but that’s because it works, and nowhere is that more evident than with gamification. Using game design to motivate customers is highly effective because it leverages people’s competitive natures while at the same time lighting up the reward center of the brain.