Do you know the secret of keeping up with your business continuity plans in these rough times?
Do you think that raising more capital and on-boarding new investors may be the solution to sustain in these the rough times? Or do you think that investing more into product development, market expansion and lead generation is important to sustain and grow in today’s unstable economic conditions?
While these may represent part of the solution for you to keep up with your business continuity plans. The real secret to business growth and sustainability lies in your ability to build a lasting relationship with existing customers and bringing back the lost customers.
According to statistics, retaining existing customers is three times cheaper as compared to attracting new customers (that’s a lot of expense we are talking about). Not to forget, it’s not the number of new customers, but the number of customers you retain that defines how strongly you are able to establish your brand in the market.
Remember, building a brand is more about nurturing loyal and lasting relations with customers than about your products and services. It’s is all about offering your customers with the level of service that makes them loyal to your brand and essentially becoming your free marketing spokesperson. In simpler words, the essence of business continuity in these rough times is all about customer retention.
This would perhaps be best understood by startups and small businesses where each new customer gained is cherished and is offered the best customer service levels in the hopes to improve retention rates.
What is Customer Retention?
In simple words, customer retention refers to the process of making a customer make a repeated purchase from the business. Contrarily, when a customer stops making a purchase from your business, it’s referred to as a lost customer. Now, honestly, there is no way you can maintain 100% retention rates because customers inevitably won’t stay with your business forever. However, what’s crucial for businesses is to make all efforts to minimize the churn-out rate (lost customers) and improve customer retention rates to the best of their abilities. Obviously, it’s easier said than done, but then, that’s the goal, right?
How to measure customer retention?
Even though customer retention is a crucial aspect of assessing a company’s overall performance. Most businesses struggle to accurately measure their client of customer retention rates. A future-proof organization on the other hand will always be able to keep track of its retention rates using built-in business intelligence tools. These tools will be used to measure the performance of business functions and take necessary actions where necessary.
Nonetheless, if you are looking to measure the retention rates, you can start by building a “marketing machine” as the first step. This means that you should develop multiple customer acquisition channels. These could be advertising, SEO, social media marketing, networking events and others. Now, the essence behind creating multiple acquisition channels is not only to optimize the acquisition rates, but also to assess the interaction pattern of customers with the brand. Customers behavior patterns can significantly vary, so it’s necessary to analyze closely to identify some key patterns.
Once you have your marketing machine, the next step is to “de-bug” it. This means that once you start to acquire customers through various channels, it’s time to start analyzing the customer patterns for each channel individually. Look out for the channel from where customers are making the most purchases or the channel where the most engagement is generated. All of this will give you a fair idea about customer preferences and why they return to your brand. Essentially giving you the lens to measure your retention rates.
Now, while this may seem a backward approach, this will essentially help you to identify the right channels. Remember, the ultimate goal of estimating customer retention rates is to improve all business processes. Thereby, without understanding the baseline expectations of customers, businesses can’t optimize the retention rates.
How to Improve Retention Rates?
Perhaps the easiest and most logical approach to improve retention rates is to offer customers better and personalized services. Earlier we mentioned that branding is less about the quality of your products or services and more about the level of personalized support and service you offer to clients.
Online shoppers today are always looking for a personalized shopping experience. They like to buy from brands that understand their preferences and offer them a customized shopping experience. One way to achieve that is by leveraging the powerful NetSuite services.
NetSuite, as the leading ERP solution, enables businesses to create a seamless integration between all different functions. It enables companies to improve their business processes, as well as, customer satisfaction. With a robust NetSuite implementation, businesses can ensure automated and integrated management of accounting, order tracking, inventory tracking, shipment and order fulfillment. The automation will ensure that there is no delays or errors in delivery. Thereby ensuring contented experience. Not to forget, the NetSuite system would also integrate customers’ data with the sales and marketing department, which will lead to better, more personalized marketing campaigns. Subsequently leading to better customer experience and higher customer retention rates.