Effective Customer Retention Strategies for Uncertain Economic Times

It costs far less to retain your present customers than it does to acquire new ones. Unfortunately, too many companies devote too many resources to customer acquisition and not nearly enough to customer retention.

Creating lifelong customer relationships that grow more profitable each year, is the key to success, especially in today's challenging market. That's why every company, mega corporations and home businesses alike, needs to focus it's energies on customer retention.

Meeting The Challenges of Customer Retention

Customer Retention is becoming more complex as technology becomes more advanced. Virtually universal internet access and an ever-increasing array of interactive media provide customers with a wealth of information including competitive data, price comparisons and access to the opinions and experiences of other customers.

Even more importantly, the internet gives customers a voice and a forum they can use to praise or criticize your company and products. It only takes a minute to post a blog, video or photo that can instantly reach millions of people. That's why it's so critical to develop a customer retention program that creates loyal, lifelong "brand insistent" ambassadors.

Developing stellar "customer care" and "CRM" (Customer Relationship Management) programs is no longer enough to build solid retention rates. Customers today demand much more.

Don't "Reach" Customers .... "Engage Them"

Simply "reaching" customers doesn't build retention ... customers need to be "engaged" with your company and products in order to keep them as customers.

Engaging customers means creating satisfying, meaningful and uniquely personal product experiences that get them "involved" with your product or service. The more satisfying the experience, the more "engaged" customers become. This, in turn, creates loyal lifelong customers who become "brand insistent" and will accept no substitute for your product. Retention never becomes an issue with them , unless , of course, you make some big-time blunders.

It's All About Customer "Experience"

Customers no longer just use products ... they "experience" them.

Each customer expects a unique, personal and totally satisfying product experience. When they consistently undergo positive experiences, they become emotionally involved with the product and it becomes part of their lives. As a result. loyalty grows and retention becomes almost automatic.

Managing Customer Experiences To Increase Retention

Marketers need to create the right customer experience and constantly manage and measure it. The intensity and degree of satisfaction customers derive from their experiences with your product is determined by several factors.

Customer Expectations

Customers have high expectations from the products they use. Top product quality and customer service are givens. They also expect 100% satisfaction ... 100% of the time. No exceptions. Customers also expect that your product fills all of their real and perceived needs. Remember that their perceived needs are very real to your customers.

Delivery of Promised Benefits

Today's savvy and sophisticated customers can see through product "hype" and expect to enjoy all the benefits they're promised. Whatever your advertising promises, you better deliver. If an automotive company, for example, advertises high performance, dependability and free maintenance, they better deliver it all, or the customer's next car won't be yours.

Satisfying Real Needs

Customers buy the products they believe will fill their specific needs the best. Whether they buy your product to remove stains, relieve a cough, satisfy a sweet tooth or get their package delivered on time ... your product better satisfy this need better than any other product ... every time they use it. If not, customer retention could be an insurmountable challenge. Consistency in satisfying these needs is fundamental to building loyalty and customer retention

Satisfying Perceived or Intangible Needs

Perceived needs are very powerful and as intangible as they might appear, they can be the primary reason consumers buy a product. These are usually needs marketers can create through effective branding and continually reinforce through advertising. Quite often, these needs are subconscious, making them even more powerful.

For example, a customer may have purchased a German sports car for its "performance" ... but the feeling of power and control he gets behind the wheel ... or the admiring and envious glances he gets when he pulls up to a restaurant that are the strongest needs being satisfied.

Men and women alike purchase a particular fragrance because it makes them feel confident or sexy or because it suits them so well, it becomes their "signature" scent. This is the "real" reason they're buying the product, whether they know it or not.

Consistently satisfying these powerful perceived needs enhances customer loyalty and makes retention far easier.

Unique and Personal Experience

People pride themselves on being unique and individual.Customers need and are looking for unique and personal product experiences that make them feel, look, smell or perform the best. In other words, it's all about "what's in it for me".

Emotional Bond

When product experiences are perceived as being individual and personal and they are consistently being reinforced over time, customers become "emotionally involved" and bond with products and companies. The strength of the "bond" determines how loyal and how easily it will be to retain the customer.

Managing the customer experience and continually striving to maximize it is fundamental to increasing and maintaining high retention rates.

How To Create Retention-Building Customer Experiences

Building customer retention is a full-time job for everyone in your organization from the receptionist to the CEO and everyone in-between. Since every person can be a direct or indirect contact point for the customer, they all play an important role in creating experiences that retain customers.

Here are eight proven ways to create retention-building customer experiences with your company and products.

Know Your Customers

How can you keep something you don't know you have? Conduct market research and surveys to get to know your market. Get to know your customers individually and understand their specific individual needs on through information gathered on sales calls or networking on social events. This knowledge becomes the foundation for creating experiences that increase customer retention.

Identify All Contact or "Touch" Points

It's important to know all the different opportunities you have to reach out and engage customers through satisfying product experiences. There are more opportunities than most marketers think. These include the way you greet customers when they visit or the way you answer the phone ... your sales calls ... community events you sponsor ... your call center and customer service operations ... your advertising ... your web site ... and dozens more. It pays to make a list so you can incorporate them as part of your customer experience management program.

Listen To The "Voice of the Customer" and Learn

The only way to discover customer needs so you can satisfy them is by listening to what your customers have to say. This requires commitment to pro actively soliciting customer feedback and a system developing a system for gathering customer data that makes it easily accessible to everyone in your organization.

There are many options including from "pre-packaged" applications available online to easy-to-use, real-time customer feedback solutions provided by companies like Mindshare Technologies.

Any time or money spent in listening to and acting on customer feedback will pay off in higher retention rates, revenue and profits.

Build The Best Customer Service Team

Your customer service reps should be your front-line retention specialists. They are most often the first point of contact for an angry customer who is in danger of being lost. Recruit them wisely. Train them. Compensate them well.

Get Your Sales Force On Board

Very often contact with a sales person creates a negative experience that fosters customer attrition and makes retention more cifficult.

Many sales people are very aggressive and only concerned with the making the sale. They going for the "quick kill" or "low hanging fruit" and sometimes ignore customers' needs in their desire to "close the sale".

Make sure both internal and external sales staff never lose sight of the importance of customer retention. Consider paying a "retention bonus" for repeat sales and retention. Even if it takes a special training session in retention for sales people, it's well worth the investment.

Reach Out and Engage Your Customers Often

Keep in touch with your customers to engage them with your product at every opportunity you can. Chances are your competitors are already contacting them on a regular basis.

Use opt-in email campaigns, newsletters, community and trade events, webcasts, holiday greeting cards, direct mail and even simple "stay in touch" phone calls.

Maximize The Customer Experience

Commit to making every contact with your product and company a totally satisfying experience for your customers. Conduct surveys or interviews to see how customers react to the experience they have with your product, services and company. Constantly look for new ways to maximize their experience and maximize your retention rates.

Thank Your Customers Often

Above all, say thank you to your customers at every contact point you make. One of the major reasons for customer attrition is that customers don't feel appreciated. Simply saying "Thank You" is one of the most powerful retention-building tools there is ... and simply saying "Thank You" doesn't cost a cent.