What’s the most sustainable way of growing a business? While your first thought may be new customers, numerous studies have revealed that the secret to success actually lies in customer retention.
Customer acquisition can be an expensive undertaking that can cost up to seven times more than simply retaining an existing customer. What’s more, building customer loyalty can offer a more lucrative return on investment with a 5 percent increase of repeat customers proven to result in a whopping 25 – 95 percent growth in profit.
In many cases, customers have more confidence in a brand whose services they have used before and as such, are more willing to make bigger purchases than newer customers. In fact, 67 percent of returning customers spend more in their third year of buying from a business than in their first six months.
So how can you boost your customer retention rates?
The savvy marketer always starts with the numbers; calculate your customer retention rate and set a target. Then audit your customer service experience and identify potential areas of improvement so your business can develop a truly exceptional customer experience. As author Rick Tate wisely points out, “Merely satisfying customers will not be enough to earn their loyalty. Instead, they must experience exceptional service worthy of their repeat business and referral.”
Then it’s time to get creative. Look at ways to make your customer experience stand out from the crowd. One way of doing this is by offering customer service surprises, even something as simple as a handwritten note on someone’s birthday could be a powerful retention tool.
If you are interested in learning more about improving your business’s customer retention rates, why not check out this highly informative infographic from the team at M2 On Hold. It includes vital information including key statistics, expert insights, and practical tips on how to improve your customer retention rates.