3 things to consider to improve customer retention rates

While acquiring new customers may be what you think will grow your business, improving your existing customer retention rates is actually the key to long-term business sustainability. Learn more about the top things you should consider for customer retention.
Niclas Lilja
By Niclas Lilja on April 20, 2018
 

While all businesses may think about growth as the acquiring of more customers, thus leading to more sales and revenue, existing customers should not be overlooked. In fact, in the B2B SaaS industries in particular, existing customers can greatly impact your future sales, and actually contribute more to your future revenue than new customer acquisition does - that is if you are nurturing those relationships. Customer retention in this way is incredibly important. If you utilize ways to improve your customer retention rates, you'll find your business growth can actually come more easily.

1. Track and manage your customer data

Without knowing who your customers are and their activities, purchases, and habits, how can you best serve them? Keeping a log in a Customer Relationship Manager (CRM) is a good place to start, but on its own is not enough.

Your customers should be segmented as much as possible. Identify your VIP customers (those who spend the most, have the biggest contracts, or the best networks that can benefit you). If they are important for the success of your business, you should be devoting time to them.

Identify your "needy" customers. Which ones need more hands-on help to implement new features, or understand how your system works? Don't get annoyed or frustrated by these customers, be as helpful as possible, and they will be more likely to share their good experience with others.

But you should also track data on signals that customers are on the verge of cancellation. Are there repeated invoicing issues? Are there customer service tickets that go unanswered? Are they spending less and less time on your platform. These are all opportunities for intervention. Reach out to these customers to identify the issue, and how you can solve it. Perhaps they aren't understanding the billing terms, they need to be walked through and implementation, or they don't know how to maximize the use of your software. It is possible to avoid losing these customers for good, just by tracking more individualized information about them.

2. Adjust your mentality to be customer-centric

Think about the factors that contribute to customer churn: perhaps your customer has an issue that is unresolved, they don't feel they are getting a good value for their money, or they don't feel that you care enough about them. If you practice a high-touch sales process, you may likely set expectations of your customers for a high level of continued support. Try to put yourself in your customer's shoes. What is most important to them, and what would really impress them in terms of customer support?

Approach your customers with enough support in place. Check in with your accounts periodically to show that their satisfaction is important to you. Be available for questions and feedback. Perhaps your organisation doesn't yet have the ability to designate account managers to each of your customers. That doesn't mean you don't have the ability to still help them. Consider how you can create content that will address and answer common questions. Create guides for step-by-step methods for getting the most out of your products. Or, create an online community where your customers can gather, ask questions of each other, or generally feel a sense of belonging.

3. Consider offering incentives and rewards

Loyalty programs and referral incentives are actually an incredibly effective method for remarketing and sales. Again, the sense of belonging that your customers may feel when they are a part of a loyalty program can greatly improve the likelihood that they will stay your customer.

For B2B companies, loyalty programs may seem like something that doesn't apply - but that's not true. As with tracking your customer data, find when your customers are up for subscription renewals. Perhaps you can give them a discount, or reward for renewing, or at least show some form of appreciation when they do. While happy customers don't always need incentives to stay with a product or company that they love, it can still go a long way in continuing to develop their positive impression of you.

It can also make it more likely they will refer your products or services to others. While consumers have long made purchases based on price and quality, experience is a major contributing factor in today's competitive marketplace. When your existing customers refer you to others in their network, it can be worth more than any of your other marketing activities.

If you are prioritizing existing customers throughout your entire organisation, rather than spending all of your focus on acquiring new customers, your retention rates will improve. In fact, you can spend far less time and money when you focus on customer retention than customer acquisition, because you have a captive audience. By utilizing your customer information and data, putting your existing customers first, and considering how to instigate feelings of loyalty, your customer retention rates will surely improve.

Want to see how tracking better subscription data can help with your customer retention? Learn more about our Subscription Management reporting features:

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Published by Niclas Lilja April 20, 2018
Niclas Lilja

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