Entrepreneurs are probably already aware of the importance of retaining customers: 70% of business owners say that retention is easier and cheaper than making new sales.
As well, there’s something satisfying about retaining customers. Along with being a recurring, reliable source of income, a fiercely loyal customer base gives you the opportunity to better understand their concerns and address them.
That said, customer retention is sometimes easier said than done. In this article, we’ll explain some of the steps you can take to keep your customers happy.
Know Your Ideal Customer
One of the best ways to mitigate a problem’s impact on your business is by anticipating it ahead of time. An understanding of your customer base is essential to this.
Why are people willing to give your business money? What is it about your current process that may leave them dissatisfied?
Whatever your answer to these questions, there are two ways to increase retention. The first is by eliminating the problem. The second is by coming up with a way to make the problem more acceptable.
How you choose to ameliorate the problem will depend on your business and the problem, but you may choose to offer add-ons or solutions that are designed to supplement the core service you’re offering.
Why Do Your Customers Leave?
Along with predicting why customers might leave in advance, it’s also useful to look at practical experience. This is where it’s particularly useful to ask customers why they’re leaving.
If you’re providing a subscription, you can ask people why they’re leaving when they cancel. If your business model doesn’t allow you to ask customers why they’re leaving, you’ll need to think hard about what concerns or complaints they have immediately before they leave.
These are essentially the “leaks” in your business that are preventing you from building a long-term, successful customer base.
This doesn’t mean you need to solve every problem that a customer who’s leaving has. There are many one-off instances where a customer simply needs to leave. However, when you start seeing patterns, it’s worth taking the time to fix the problem.