The Customer is always right!
You must have heard that old truism a million times. That statement couldn’t be more relevant today.
The digital world not only shapes customers’ buying experience – it puts them at the center of its universe.
Check out these:
To understand the importance of repeat customers let’s look at what retention rate means.
Client retention rate is the percentage of customers kept. It’s the opposite of churn rate, which is the percentage of customers lost.
It’s pretty straightforward:
Congratulations – you have your repeat purchase ratio. This is how many clients out of every 100 you can expect to come back for another purchase.
That’s another factor to consider when calculating client retention rate. And it indicates the number of actions the consumer takes, necessary to include them in the repeat customers report.
Have they only logged in? Or have they logged in, signed up for a weekly newsletter and made a new purchase?
Lastly, you’ll need to figure out the right time span within which to measure your average customer retention rates.
That could be anywhere between a couple of days and several months, all depending on your business processes, objectives, and observations.
You can probably figure that your business will profit significantly if you manage to keep your client retention rate up.
That doesn’t mean you should stop attracting new customers, of course.
But you probably need to have in mind that:
This survey found that nearly half (half!) of buyers will skip your product if you can’t make the purchase experience exciting. And that shows the importance of originality for customers.
If you can’t turn your prospects into buyers, you won’t be able to turn them into loyal brand ambassadors either.
I can completely relate to the frustration of having to deal with an automated answer machine.
According to a Harvard Business Review, customers turn to a business’s support team to get a quick and easy solution for their problem.
Satisfactory customer service is what customers want. When that need is not met we come to this:
This is one of the reasons why companies lose customers.
And it’s not surprising the loss businesses suffer due to poor service amounts to $1.6 trillion.
Another interesting number businesses need to consider is:
We can all agree that makes sense, given that cellphones have become an extension of ourselves, in a way.
So it’s only logical that:
Customers do expect companies to meet a high standard of service. That’s not enough, though – apparently speed is also a factor:
(Google Marketing Platform)
People appreciate speed across all stages of the customer experience. Even after they’ve already made a purchase and they need some help.
Now, you may think you’re doing what’s necessary to make your customers happy.
But look at this:
These are the numbers for 2017. Now, companies may have marked a slight improvement since then. That said, you’re still going to be way ahead of the pack if you optimize the mobile experience of your website.
Is your business mobile? How do you feel about your service?
If you haven’t put much thought into it, now is the time to look closely at how happy your current customers are. Here’s why:
So, digital customer experience becomes increasingly important as the preferred way to shop shifts to mobile.
What’s the average customer retention rate there then?
Divided by industry, mobile retention also differs by months. Let’s look at what Localytics’ findings were for 2017.
The percentage starts to drop after the first month.
The client retention rate at the end of month #3 goes down further with somewhere between 3 and 5%.
But what is a good customer retention rate?
Opinions differ but one research by Mixpanel shows that most apps and software have between 6-20% retention rate (for a 2-month time span), depending on the industry.
Now, while customers seem to prefer making purchases through a mobile device, companies need to consider that:
(Harvard Business Review)
Customers who use multiple channels to shop spend 4% more in a physical store and 10% more online than the single-channel customers. And every additional channel they use means they spend even more money.
What does that tell us about customer satisfaction and retention?
Customers like to do their research.
Not only that, but customers expect to have the same pleasant experience no matter the way they chose to shop. And unfortunately, they don’t always get it.
It becomes obvious the hard part of the job is pleasing the clients so they stick around.
The slightly unfair part is – a happy client won’t necessarily go around, sharing how happy they are with you. Unhappy clients, on the other hand, are different.:
Yup, get used to it. Unhappy clients are always more vocal. You’re inevitably going to see negative feedback, even if your business is actually doing fairly well.
Let’s now look at what will actually make customers become part of your brand loyalty statistics.
So, it’s actually possible to build a lasting relationship with your clients.
And the right service will lead to:
The good news is that customers also like to share their positive experiences.
However… turning consumers into loyal brand ambassadors means tending to their needs.
What does that mean?
Here’s what Forbes reports:
Consumers like to be engaged with your brand in a way that makes them feel like you know them.
And buyers are ready to pay for that personalization.
The experience your client has is part of what you’re selling, whether it’s a product or a service. Improve the experience – and you can attract better clients and charge more for serving them.
Further stats show that:
Consumers understand that personalized experience means they’ll need to share a bit of personal information.
And according to Accenture, they don’t seem to mind it.
Now, sharing data comes as part of an agreement that businesses will be transparent about how they use it.
By 2020 we expect to have more than 30 billion IoT devices, which will rise to 80 billion by 2025. Business will need to transition into a digital-first business model.
While this will help companies optimize their processes, it will also mean customers will have the upper hand when communicating with brands.
Consumers will need to be shown the value of the service you offer and in a much more personal way.
And that can be tough.
But don’t worry, there’s a light at the end of the tunnel.
Ask and listen to what your customers want. They genuinely want you to know what that is, so they can buy it from you.
What do you need to do to make customers stay?
The future is digital. Companies need to make use of that and turn to technology to help them start an online conversation with their customers. This is where using data to predict the best experience is useful. That way, a business can offer its customers exactly what they want.
Everyone likes a good deal and that remains valid for consumers in a data-driven age. Customer service studies show that people are willing to share more information with a company if that means better experience. This includes personalized price discounts.
A bad customer journey can be an issue for any business. If a customer gets disappointed with your service, you won’t see them coming back. So, you should invest in creating platforms that are able to “wow” your customers.
One thing that is crucial, according to loyalty statistics, is speed. You need to address your customers’ concerns and address them quickly.
That together with helpful employees and friendly service matter the most.
Interacting with a real human is important to clients. Regardless of the technology that supports the customer journey, consumers like to know there’s someone there they can actually talk to.
When you create your customer experience, bear in mind your clients will be using different means to shop. Provide convenience, so clients will have the same great experience shopping on their phones, tablets, or in a physical store.
Business and personal life are now becoming one. Clients expect to be targetted in a way that is relevant to them.
You can go around offering discounts for rollercoaster rides to seniors but they’re most probably not interested. (Although, how awesome would that be!)
More than that, it’s no longer enough to assume someone will be more engaged with your product just because they’re in that demographic group.
People want to feel personally involved and if you want to be on the positive side of the customer retention statistics, start spelling “personal” right.