3 effective ways to improve customer retention

Businesses can never be sure to retain their customers forever. And hence they need to consistently take steps to differentiate themselves. Today, with newer companies offering stiff competition, established players are also forced to strengthen their customer base to retain advantage.

3 ways to retain customers

You already do a few things to achieve this. People have told you about improving service quality or providing discounts. When all these can definitely help, you need to think one step ahead to stand out in the crowd. Here you will see 3 powerful ways by which you can impress your customers, which typically many companies fail to, or ignore to do.

1. Go the extra mile

Many do not realize the difference extra effort can make in a business relationship. Whether you are into B2B or B2C, customers have started seeing businesses as guides than just sellers. For example, if you sell car insurance, customers today expect you to give suggestions on the best service center for their car in the locality.

Also, this is the era of experience economy. You need to provide your customers with a satisfying overall experience than a mere product or service.



 

 

So be ready to put in that extra effort and investment to make your product or service more attractive. Following are a few ways in which you can do this.

  1. Share useful information with customers: People crave for fresh and useful content or information. Use your customer touch points such as POS (Point of Sale), social media, advertisements & promotion etc. for this. An example would be offering an ebook in a related topic to your business.
  2. Offer complementary products or services: Customers do not prefer to go to multiple places to fulfill their needs. So help them solve a problem with a suite of products or services. An example would be selling cleaning liquid with a mop. If you do not want to build the capability to create the complementary item in house, you may partner with another company.
  3. Surpass the expectations: This is obvious. Impress your customers by giving more than what they expect. If you are a service provider who is committed to deliver a service in 3 days, finish it in 2 days and use the remaining time to further improve/optimize the service. If you sell a product, add an unexpected yet useful feature to your product,

2. Be proactive and always take the first step

The dynamics of business-customer relationship is changing fast. As mentioned in the previous section, companies need to act as guides and partners to customers. In the service sector, the traditional way of customer laying out the requirements and the business delivering those, is soon going to die. Customers expect service providers to proactively contribute to their business through advisory services, value adds and business support.

If you see a problem in the customer organization, don’t hesitate to bring it to their notice. For example, if the invoicing process in the customer organization is lengthy and time consuming, you can propose to enhance it by optimizing it through better use of technology. But make sure to do it professionally.

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Also, if you see an opportunity of improvement in the areas of your work with a particular customer, be proactive to suggest next steps before the customer notices it. This can also help in establishing more trust and credibility.

Businesses can take a few steps to continuously explore opportunities of improvement in their own areas of work, as well as customer business. Some of them are given below:

  • Encourage employees (or delivery team members) to come up with new ideas in their areas of expertise
  • Facilitate constant interaction with customers to understand their business landscape better
  • Highlight and position yourself as a strategic partner from the very beginning of a relationship.

In B2C, portray yourself as a company which cares for their customers and is always ready to help. For example, if you are into selling a water purifier that requires maintenance once in a six month, be proactive to reach out to customers to check before they call you up.

These small steps can make a huge difference by increasing customer loyalty which will lead to a long lasting relationship.

3. Value beyond contract

We have seen how being proactive can help. Value beyond contract is kind of derived from the same. With new businesses popping up in your niche everyday, it is very difficult for you to differentiate, especially if you are selling a commodity. Hence, offering a basic product or service is not enough. In a B2B scenario, maybe you are delivering all the services you committed to, in the stipulated time, and hence you are fulfilling all contractual obligations. But every other service provider would do the same. So, you need to provide value added services to attract attention from your potential buyers.

Now the question is how to do this. The best way to start is by looking at your competition, as to what they do and don’t do. You can choose to mimic something that has been working for them. You might have seen some companies offering discounts if a competitor is also doing the same. Similarly, you can introduce offers or services that your competitors don’t have. But remember that you are not looking for mere differentiators, but value adds. So only go with those which add value to customers’ life or business.

Following are a few examples of such customer value adds:

  • A beverage company partnering with a food company to provide a drink + snack combo pack.
  • A logistics company offering to provide packaging services to increase customer convenience.
  • A data company that provides reporting services to its customers , offering analytics services over the standard reports.
  • An IT company helping customers to save cost by reducing the number of steps in a business process through automation.

Depending on your business domain, you can come up with your own set of ideas to provide value to customers. Make it a practice to encourage your employees to explore innovative ways.

Those were my top 3 ways to improve customer retention. Start applying these to your business consistently to make the maximum out of them. What’s your favorite of the three? Leave a comment. Also feel free to share your views and opinion.

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