Every small business leader is on the lookout for a new customer. Signing a fresh contract or onboarding a first-time sale gives a high unlike any other. It is clear customer retention is important, but few business leaders reflect that value in their daily schedules. It can seem like a waste of time to meet the needs of every customer when there are so many leads out there just waiting to buy.
But did you know that you are spending five times more money acquiring new customers than keeping old ones? If your customer churn is leaving a trail of unsatisfied or underused accounts, you've just ignored fruit hanging so low it's practically touching the ground.
Is there a way to keep existing customers happy without spending so much time doing it? Customer retention doesn't have to be a mystery. With so much data at our fingertips, it becomes a more precise science every day. When you know the types of products customers like to buy, how often they browse your site or visit your premises, and their biggest pain points, you can establish automated campaigns to maintain engagement. You've already got them on board – you just need to keep them with you.
Abandon the leaky boat.
All business owners worry about churn rates, or the pace at which customers abandon their products and services. However, rather than slow down the churn rate, most double down on customer acquisition. Small business owners believe that if the rate of signing up new customers outpaces the rate of losing existing customers, they'll remain successful. But this is like bailing out a leaky boat. At some point, the water floods in faster than you can get it out, and the whole operation goes under.
Some churn is normal. Not all customers are a good fit for your brand, and it's better to move on than chase people who will never be satisfied. But excessive churn jeopardizes your company's future.
Even though they're aware of the problem, many leaders gripe that customer retention strategies are too costly. They assume that they must hire more customer service representatives to manually call all customers and spend hours listening to their complaints. Obviously, that solution is not scalable or even realistic.
Fortunately, automation offers an antidote. With a few well-trained associates and a smart chatbot system, you can collect customer data, answer questions and guarantee regular contact at scale. Customers don't expect reps to spend hours on the phone with them. In fact, 35 percent of participants in a Ubisend survey said they'd like more brands to use chatbots. That's all the more reason to introduce automated communication into these relationships.
Convert smarter, not harder.
In a constantly changing market, organizations that don't evolve and maximize productivity are already losing. If small business leaders want to stay in the game, they need to use automation to create high-performing retention strategies.
Want to improve your company's customer retention with automation? Start with these strategies.
1. Know your customers.
Before you build a retention strategy, you need to get to know your customers. Use automation software to capture data about their demographics, browsing and buying behaviors, and even their social media activities. Know how you signed each customer – the details matter. The more detailed a picture you develop, the richer and more personal a relationship you can cultivate.
As Dan Ariely wrote in "Predictably Irrational," blanket solutions – particularly those involving financial incentives – often backfire. If you offer discounts every time a customer threatens to leave, you merely teach them that you'll reward them for raising a stink.
Knowing your customers, on the other hand, creates positive brand connotations and delivers on a growing customer demand. Researchers found that 80 percent of consumers surveyed said they're inclined to buy from companies that provide personalized experiences, so get to know your audience rather than investing in short-term promotions.
2. Record everything.
Every time a customer messages your chatbots, emails your support team or leaves a product review, use automated processes to document the interaction. Conduct periodic analyses to spot trends in these activities. Then, use the data to address customer pain points.
Perhaps a large percentage get stuck on the checkout page or struggle to elicit useful answers from your chatbot. Catching those problems allows you to mitigate customer losses by fixing the issues before they get out of hand. Take note each time a customer calls about an issue, and note the solution for future reference.
If possible, track how often customers use your product. When you see a drop-off, reach out to ask about their experiences. Intervening before they abandon a product increases the likelihood that they'll remain active customers.
3. Aggregate your data.
By combining transaction data with customer profiles, you gain a comprehensive picture of your business. You can use this view to identify long-term customers and determine their average lifetime value. You'll also spot customer acquisition trends, and you'll begin to understand which tactics are successful and why.
Then you can deploy automated re-engagement tactics at the points where customers tend to fall off your radar. A simple, personalized touch might be all it takes to get them back on your site and buying from you again.
Be sure to share all information across departments. Siloed data is wasted data, so choose intel-gathering tools with dashboards multiple users can access. Then your teams can collaborate to deliver a consistent brand experience.
When customers disengage, all is not lost. You can win them back, but it requires time and money – both of which you already spent on the initial conversion. Winning customers back is better than losing them altogether, but using automation to retain them in the first place is even better.