Increase customer retention with a CRM 2022
gures like these, it is no surprise that customer retention has come to the top of the agenda for companies and their marketers. Central to achieving this goal of customer loyalty is the customer dropout OR retention rate.Your dropout rate is the percentage of customers who stop using your company's products or services within a certain period of time. Customer dropouts can be costly for companies, as it can be more expensive to acquire new customers than to retain existing ones.
On the other hand, the customer retention rate evaluates the percentage of customers who continue to do business with your business over a period of time. This calculation is important for companies to track, as it can indicate how well they are retaining their customer base.
You can choose to view the glass as half full by monitoring and reporting the customer retention rate, while others see it as half empty by keeping track of customer dropouts. In the big picture of customer relationships, both calculations examine the same thing.
In this article, we will define what customer retention is, and then we will also highlight the use of a CRM software along with other techniques as a strategy to improve customer loyalty.
What is customer retention?
Customer retention is a measure of how well you can get customers who have already converted to continue to support your business over a period of time.
B2B companies need to focus on customer loyalty in order to maintain a strong customer base. By keeping existing customers happy, they are more likely to continue doing business with the company and recommending it to others.
To calculate your customer satisfaction ratio, subtract the total number of customers at the end of the period (CE) from the total number of new customers (CN) you had during the period under review. You then continue to divide the sum by the total number of customers you had at the beginning of the period (CS), and then multiply by 100; as described below.
(number of customers at the end of the period (CN) - new customers acquired during the period (CE)) / (number of customers at the beginning of the period (CS)) x 100
What are some customer retention strategies?
Customer loyalty is directly linked to customer satisfaction - the more satisfied your customers are with your product / service, the more likely they are to continue to ignore your competitors. Below we show some customer retention strategies that you can use to get your customers to come back.
CRM data also gives you a blank canvas to customize the user experience. There are a few ways to do this. You can go after customers with specific offers based on their previous interactions and purchases. Another way is to customize the customer experience on your website or in your store. This may mean displaying different content or recommendations based on what you know about the customer. By using CRM data, companies can create a personalized experience for each and every customer, which will lead to higher satisfaction and loyalty.
Pay attention to the triggers
Customers rarely decide to just go, there are things like an ignored complaint here and a bad product there that makes them absent before they finally decide to switch to a competitor. Detecting these signs in advance can greatly help companies keep customer dropouts in check.
Customers often show patterns of behavior that reflect their emotions - delayed orders, reduced order volumes and gradual changes in the relationship with customer service. However, tracking all of these in a meaningful way can be a nightmare.
To demonstrate, a trend of lower engagement is an indication that a customer's likelihood of doing business with you is gone. Just before they walk out the door, you can run a survey or send a short email campaign to revive their interest.
This is where CRM software helps you with the overview, and gives you a complete picture of the customer, with interaction logs and other CRM tools that gather all the interactions that each customer has with your business in one place. You can also access - in real time - all the insights needed to detect downward trends that may occur before customer dropouts.
Reward loyalty with special offers
Rewarding customer loyalty is not only one of the best ways to nurture business relationships with customers and improve retention rates, it is also a way to ensure that "leaving the ship" remains an unattractive option for customers. You can give special discounts, give gifts or bonus products to celebrate loyalty milestones.
And with CRM, it has never been easier. CRM data gives you insight into your most valuable customers - then it's up to you to make them feel like it's their birthday! Instead of creating gift offers based on guesswork, you can create special, personalized benefits, incentives and promotional packages for individual customers, developed according to customer profiles collected and streamlined by your CRM system.
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