3.3.2022

How to Retain Your Customers: 10 Customer Retention Tactics

Written by Lauren Valensky

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Many business owners spend a lot of time and energy trying to figure out how to attract customers to their brand.

However, while this is a vital part of growing your business, considering that most companies can grow their revenue by 25%-95% after increasing customer retention by just 5% [1], retaining your existing customers is just as, if not more, important and can be the solution for significant growth.

So to help you refine your retaining skills and build up your business, we’ve compiled a list of 10 customer retention strategies that will keep customers coming back.

What are the benefits of customer retention?

Whether you work in the hospitality or retail industry, the famous line ‘you’ve just lost me as a customer’ usually incurs an eye-roll. However, losing customers should not be taken lightly, as pushing patrons away can play havoc with your profit margins.

In fact, research shows that the probability of selling to a new customer is only between five to 20%, while the probability of selling to an existing one is 60-70% [2], which demonstrates that customer retention should be a top priority for any business owner.

Not only does keeping your customers happy, result in them spending more money with you, but they’re also more likely to act as advocates for your brand and ultimately bring in new business since 92% of consumers around the world now say they trust word-of-mouth or recommendations from friends and family, above all other forms of advertising [3].

Check your churn rate

When discussing customer retention rates, you often come across the concept of customer churn. Customer churn is a metric that measures when a consumer ends a relationship with your company after a certain period of time, and is generally measured by month or year, depending on the industry [2]. 

If you have metrics that can measure your company’s churn rate, examine them closely to determine how often or when you’re losing customers. Doing so will help you uncover patterns and reveal whether you need to do more to retain those customers. If your churn rate rises, you’ll know you need to take action.

Use social media and email marketing

Your company needs to be visible on as many channels as possible. While there are many means for businesses to communicate with customers, social media and email are the most effective in terms of both cost and reach.

Create dynamic social media posts that engage with your audience and craft stunning emails that promote your products and services that call your customers to action. This is crucial for keeping interest in your company high.

Offering exclusive deals through particular channels to raise engagement, presenting channel-exclusive products or enabling an email-exclusive discount for a future purchase, will go a long way to keeping your customers engaged and spending. 

You’ll also want to identify particular platforms that will be useful to you. It’s important to meet your customers where they are, on the channels they like to frequent [3]. For instance, clothing brands that target people aged 14-24 would have a lot more success advertising on platforms like TikTok, and Snapchat, since those platforms are more popular with that demographic. 

By the same token, that same brand might waste a lot of time and resources creating ads and posts on LinkedIn, where it’s unlikely they’ll reach the kind of clientele they’re after. 

Having access to social media insights across these platforms also gives you a good measurement of customer loyalty and retention rates, which can ultimately help you to optimise your retention strategies.

Stand out from the crowd

Most companies need a unique selling point, or USP, to differentiate themselves from their competition and keep customers engaged. 

The smartphone market is a good example of how to differentiate yourself from your competitors. Most smartphones are, in many ways, identical. Most use more or less the same components and have the same software capabilities. But what differentiates an iPhone 13 from a Samsung Galaxy S makes them appealing to different customer segments. 

One phone may have a more powerful camera, another might have partnered with service providers to give their customers particular discounts. People are unique, and so will be attracted to different aspects of these products. 

We suggest dedicating a section of your business plan to your USP, you need to ensure sure people understand what makes your product special. This way, your customers will be less likely to abandon you for one of your competitors. This is known as a differentiation marketing strategy.

Pick a customer loyalty program

From point cards at grocery stores to punch cards at cafes, patrons like feeling that their dedicated, continued custom will be rewarded by the company they buy from.

The most effective customer loyalty programs are ones that correctly identify those likely to become long-term shoppers. These rewards schemes ensure loyalty by identifying how their products or services can serve these customers. 

If you use Epos Now’s electronic point of sale system (EPOS), you can access apps like LoyalZoo that create dedicated customer loyalty programs that can be run exclusively online. 

Add in business apps 

Once most companies reach a certain size, they begin to dedicate particular teams to customer support. However, this isn’t always possible or necessary for small or medium-sized retail or hospitality businesses. 

Using an Epos Now EPOS system simplifies the customer retention process completely; Line up with our Loyalty app to ensure you’re making informed marketing decisions and create easily automated, email marketing campaigns, with our Mailchimp integration.

Connect to your customers 

If you really want to connect with people in a way that will keep them with your company for the long haul, you want to connect with their core values.

Connecting to a customer’s values is a tried and tested strategy in marketing and makes them more likely to stick around. Consumers naturally gravitate towards companies and brands that reflect their personal beliefs, whether political, social, aspirational, aesthetic or otherwise. 

What do you want to stand for? If you haven’t yet figured this out, it might be a good time to start. Once you figure out your company values, you can start targeting the right people for long-term retention. 

Feed off feedback

Sometimes, mistakes are inevitable. You make a product that doesn’t live up to expectations, or maybe a customer has an interaction with your support team that doesn’t go very well. While no one likes it when these things happen, they’re part of being in business - how you react to these situations is the key to retaining your customers. 

Since only 1 in 25 people who are unsatisfied with their company will complain directly to customer services, when you encounter a complaint, you’re only seeing the tip of the bad experience iceberg [5]

With this in mind, when you do get a complaint it’s important to act on it as soon as possible. Not only does this keep customers happy, but also helps maintain the reach obtained through word-of-mouth.

Displaying these responses quickly, concisely and politely, is crucial for maintaining a good reputation between current and potential customers, considering 48% of customers who had an unresolved negative experience tell 10 or more others[6]

But how do you get feedback? Sites like Google Reviews and Glassdoor can give you an insight into how your company is viewed by customers, as well as current and former staff. Most companies set up email accounts dedicated to customer feedback, you can get various forms of feedback through your social media channels. 

Once you receive your feedback, it’s important to address the issue in a way that makes the person feel heard and understood, whether they’re a difficult customer or not. Then, ensure that you’re addressing the problems in the complaints to the best of your ability.

Show appreciation

Without your customers, you wouldn’t be in business. Showing regular appreciation for loyal customers will make them feel valued and will therefore encourage them to stick with your business. 

Customer appreciation can take many forms. It can be doing social media posts thanking particular customers for their business, offering discounts to customers who have been with your company for a certain amount of time, or offering them exclusive business benefits.

When people feel they, as individuals, have been rewarded for their loyalty, they are more likely to extend that loyalty into the future. 

We’re open!

Customers need to trust that you have their best interests at heart and that you’re not just out to make a quick buck. Be transparent with your business dealings, figures, and supply/production chains to build a rapport with your customers so they feel comfortable doing business with you now, and down the line.

Keep customer relationship management close with an award-winning EPOS system

By choosing the right customer relationship management software for your small business, you can turn your attention to other areas of your business, like operational efficiency and finance. Let your point of sale(POS) system handle things like sales trends, customer profiles, and loyalty programmes. Epos Now offers state-of-the-art POS systems for hospitality and retail businesses.

With Epos Now, you can:

  • Create personalised email communications using set templates
  • Schedule emails and SMS messages to be sent at the most impactful time of day
  • Review analytics on engagement with your website and outreach 
  • Save customer contact details and shopping preferences for more targeted marketing on our CRM system
  • Integrate with the business automation apps that are right for your business

Did we retain your interest with our top 10 customer retention tactics? If you want to learn more, we'd love to hear from you!

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