The top 5 customer retention marketing tactics

Barbara Wold is a renowned customer service speaker, a leader in her craft and a fantastic person.

I was fortunate to have met her when I gave a talk about leadership to international airline executives a couple of years ago in Miami, Florida. Barbara is such a pleasant and professional guru. She has so much wisdom and so much enthusiasm to share. Her works and insight on sales and quality service are certainly top-notch. The methods she uses on presenting her thoughts are incredibly entertaining and humorous to no end. Also, she is not a stranger to the Philippines; she once spoke in a Philippine retail conference. 

And it is with great gratitude that she has given me permission to feature some of her articles on customer service.

Customer retention, as you know, is a very crucial part of a business offering retail or any other business deals for that matter. It is a sign that they trust a business, a sign that they are satisfied. And this is what businessmen work sincerely hard for: trust, loyalty and patronage.

Now, allow me to share with you some of the information she shared with me and a few comments of my own.

Barbara says:

The probability of selling to an existing customer is 60-70 percent.

The probability of selling to a new prospect is 5-20 percent (credit: Marketing Metrics). 

Research also shows that a 10 percent increase in customer retention results in a 30 percent increase in the value of the company (credit: Bain and Co.).  Many marketing plans are so focused on customer acquisition that they largely ignore customer retention. 

Here are some ideas to help you kickstart your customer retention marketing:

1. Regular communication with customized content and special offers – This is the cornerstone of any good customer retention program and careful attention should be paid here.  Most companies have some sort of newsletter to communicate with existing customers, but fewer are actively making offers to their current client base that are customized according to what is already known about the customer. 

My thoughts: Regular communication and special offers are certainly favorable. But sometimes, regular customers feel like benefits and promotions are given to attract new signups, but the regular clients who have been faithful all these years have not been rewarded. This is why some clients would choose to terminate their subscriptions and shift to a competitor and then switch back again so they can get the best deals.

2.Customer service – Poor customer service accounts for 70 percent of customer loss.  Marketing should take that number very seriously and work with the support team to deliver content that can help the service folks and sales staffs do their job. 

My thoughts: Business is a coherent process. From top to bottom, employees should work well with one another. Sadly, poor customer service can stem from poor management and leadership. Sincere guidance on leadership and constant reminder of human values can help with this.

3.Listen (and then talk) – The overwhelming majority of unhappy customers will never communicate their dissatisfaction with you.  Regularly checking in on customers will help you to see signs of an impending departure while there’s still time to fix problems.

My thoughts: True. Indeed, I have seen this in action many times. Instead of bringing this up straight to the management, they tweet, blog and post about it on their Facebook pages and they even share it with everyone they know.

4.Loyalty programs, appreciation awards and customer referral rewards – rewarding customers for referring you new business or for repeat buying is always a good idea.  Even in markets where it isn’t appropriate, you can still give customers an award to recognize them (and give them something to brag about).

My thoughts: The idea is utterly pleasing and I know customers will surely delight in it, yet I find it hard to remember being on the receiving end of this, because it has never happened to me.

5.Bring your customers together – In large companies, an annual customer conference tends to be one of the most successful marketing tactics done. Companies with smaller customer bases and budgets are doing similar things by creating online spaces (in the form of forums, custom social networks, facebook or LinkedIn groups, etc.) where customers can connect, share their experiences and learn from each other. “Customer appreciation” events work very well, too.

My thoughts: The digital platforms are there. In a business organization, what makes employees work together is the sincere relationship that they have towards success. From there, pleasant and meaningful relationship with the customers can follow.

You and I are in the “participation Economy,” we need to bring our ‘customer service efforts’ to a higher level and constantly look for innovative ideas to further our customer relationship and ultimately earn their loyalty.

Barbara ends her material with a quote that says: “However beautiful the strategy, you should occasionally look at the results.”

And she is right.

Thank you so much, Barbara!

(Spend two inspiring days with Francis Kong learning leadership and life skills as he presents Level Up Leadership on June 24-25 at the EDSA Shangri-La Hotel. For further inquiries contact Inspire at 09158055910 or 6310912 for details.)