Customers are the key factor for any customer-centric enterprise to stay relevant in this competitive and evolving market. Acquiring a new customer can generally be a long and tedious process where most companies have to spend a huge part of their resources. This is why customer retention is imperative for the growth of a business.
What is customer retention?
It is a productive process that an organization or business takes up by continuously engaging and interacting with existing customers to reduce customer tickets and improve profitability. Retaining an existing customer helps businesses in fuelling their ROI as well as maintain loyal customers.
According to the book Marketing Metrics, “businesses have a 60% to 70% chance of selling to an existing customer while the probability of selling to a new prospect is only 5% to 20%.”
The benefits of customer retention in business enterprises are countless.
- Primarily it reduces the cost of marketing and boosts up your business ROI.
- Retaining a customer is more affordable than customer acquisition.
- The ultimate payoff of this relationship between customer retention and profitability is the productive growth of your business.
Research by Frederick Reichheld, inventor of NPS shows that “increasing customer retention by 50% increases profit by 25%-90%.”
It’s interesting how customer loyalty drives profitability. Crossing the bridge of customer satisfaction to customer loyalty is important to build a long term bond with your customers. Loyal customers tend to spend more on products as they already have invested their trust and time in your business. Creating repeat customers means creating a field for ‘mouth marketing.’ Focusing on delighting your customers makes them spread positive word- of -mouth by sharing experiences and referrals. Therefore, the impact of customer retention on profitability is that it helps in attaining better conversion rates with a low budget marketing, an increase in business ROI, lower churn, and a ground for companies to work on their gaps.
84% of global respondents across 58 countries to the Nielsen online survey said that “this was the most trustworthy source of marketing.
Once you understand the importance of customer retention the usual question that pops up is, what are the ways to retain customers and increase business ROI? This includes several ways like providing:
- Constant customer support
- Loyalty programs, like giving rewards or offers
- Conversational support with continuous interaction without leaving customers on the bay.
The best customer retention technique to increase ROI is by automating the effort with a SaaS platform like Kapture CRM that unifies incoming tickets from multiple sources (email, chat, social media, etc.) onto a single dashboard. The cloud-based platform provides unique features like Customer 360degree view, where companies can understand customers better which helps them in maintaining personalized data.
The major benefit of this automated platform are:
- Effective customer data management that helps in understanding customer-centricity (how customers use different channels) other than mere demographics for personalizing customer experiences.
- Quick and faster ticket resolution with personalized contextual support. Faster tickets ensure loyal and happy customers.
- Self-service, where customers can get instant solutions for their queries without hanging in calls or emails, thereby making your brand stand out in the market.
Establishing your brand name is a demanding process in today’s market and customers are an integral part of it. Therefore, be smart and choose the right steps for ensuring customer retention.
Book a demo with Kapture CRM to understand how you can take your customer support to the next level.