Definition: Customer retention
What is customer retention?
Customer retention refers to the activities, tactics, and strategies that brands use to keep customers loyal and satisfied—and prevent them from defecting to competitors. Customer retention strategies are vital for brands from both an economic and brand-building perspective. It costs businesses five times as much to convert a new customer than it does to retain one. Furthermore, maintaining loyal customers helps to build brand awareness and create brand advocates who will tell others about your products and services.
Building customer retention enables brands to get more value out of their existing customer base and form long-term, profitable relationships. Customer retention strategies don’t need to cost a lot of money. It’s about listening to what your customers want and need—and understanding what you can do to solve their problems and make their lives better. This could be offering relevant, valuable content as the customer lifecycle progresses, or sending a special offer to show you appreciate their loyalty.
A high customer retention rate should be at the heart of a brand’s sales and marketing strategy. Understanding the reasons why customers churn is vital, as is responding to any issues swiftly so you can deliver a better customer experience. It could be the product or service needs improvement, or that customer service provision needs an overhaul. It might also be that the marketing messages and content marketing activities aren’t attracting the right customers. Either way, it is critical to a brand’s long-term success to monitor customer retention and adapt the marketing approach accordingly.
Want to find out more about how you can build successful long-term customer relationships? Check out our free on-demand webinar on how content can ensure customer retention.
How do I improve customer retention?
Customer retention activities should be present across every touchpoint a customer has with your brand. From the agent that answers a query to the content you share on social media, it all helps form a robust and effective customer retention strategy. Here are a few actionable ways to improve customer retention.
Deliver valuable and personalized content
From the how-to guides you offer hot leads to the targeted newsletters you send to established customers, content marketing is one of the most effective tactics for customer retention. Every piece of content should be useful and relevant to the customer and personalized where possible. For example, sending an explainer video to a customer who had expressed an interest in a particular service. If this sounds time-consuming, it needn’t be. Find out how creative automation tools can help with personalization.
Offer great customer service
Making sure you resolve any queries quickly is key to customer retention. This means offering both personal and self-serve customer service, on the channels your customers want to use. You might not have the resource to deliver 24/7/365 customer support, but you should have online resources to help customers resolve issues and the ability to follow queries up as soon as possible.
Information must always be up to date, accurate, and relevant. The customer should receive a response straight away, even an automated one that manages their expectations for the next steps. Customers should feel they are important and are being listened to, at all times.
Reward loyal customers
Showing customers that you value them is central to customer retention. You might not be in the position to offer free gifts or physical incentives (though these are great tactics if you can!). But if budget is tight, why not show you care by sending a preview for a new product, tickets to an event, or including a personalized thank you message in an order confirmation. Showing you are grateful for their loyalty goes a long way.
The Forrester Wave™ Digital Asset Management for Customer Experience, Q1 2022
Understand the benefits of DAM, how to select a DAM provider, which DAM is right for your business, and get an overview of Bynder and other DAM platforms.
How content can help ensure customer retention
After a challenging 2020 with multiple disruptions, marketers still feel many of those effects while facing new challenges.