So much attention is paid to improving customer acquisition by marketing, customer experience, ecommerce, and other consumer-centric, growth-focused teams today.
Not nearly as much time and energy is spent on cultivating effective customer retention strategies to keep shoppers and subscribers coming back to buy and/or renew.
You don’t need us to tell you the (many obvious) benefits of gradually growing your customer retention rate over a period of time on top of improving your acquisition numbers.
But we never pass up an opportunity to share compelling industry stats:
- 93% of consumers stated they are more likely to become loyal customers at companies that provide top-tier customer support and service to them.
- “Experience-driven businesses” see 1.6x to 1.9x more growth in key retention metrics (repeat purchases, average order value, CLV) than other brands.
- 35% of enterprise business executives said reducing churn and retaining customers were two of their companies’ “leading objectives” in 2019.
We’ve already shared a churn prediction guide to help business technology users learn how to anticipate attrition with advanced machine learning models — such as those offered in BlueConic’s pure-play customer data platform (CDP).
Preventing churn and retaining customers obviously go hand in hand. But a modern retention strategy entails much more than just simply keeping customers from the door.
Rather, a robust retention plan requires a concerted focus on your customers. Specifically, it means monitoring every touchpoint they interact with in their respective customer journeys and across each lifecycle stage to serve the most relevant messaging and experiences.
Only when this approach is in place can you and other growth teams at your organization build long-term loyalty with your customer base — and accelerate growth at the speed and scale expected of you by your leadership team.
How to build your customer retention strategy with a pure-play CDP
There are many ways to go about crafting a customer retention strategy today.
But there are three specific traits of highly successful retention strategies worth keeping in mind to ensure you gradually reduce your churn rate, enhance your customers’ lifetime value and loyalty, and retain buyers’ and/or subscribers’ business in the long run.
1. Adopt an analytical mindset — and the right database.
The adoption of data-driven business technologies isn’t anything new today. (Though the agile-vs.-waterfall technology adoption debate remains a hot one.)
Many companies leverage many data tools today to increase customer loyalty, improve the customer experience, and enhance other core metrics — tactical and strategic).
For instance, they use business intelligence (BI) solutions, analytics tools, customer relationship management software, and the like to evaluate their engagement efforts geared toward prospective and existing customers and inform adjustments to them.
These platforms are still viable options for companies’ tech stacks. But the value that can be extracted from them is limited without their data synced into a CDP.
For example, you may use BI tools to compile customer data from other tech. But if data from those tools is only unified to derive insights and you can’t take action on it within the tools in question, you’re missing a critical piece of your retention strategy.
The data must be unified into a single source of truth that is accessible by all your systems for cross-channel activation (ads, emails, on-site messages). If it’s not, you’re left to turn to multiple, disparate, disconnected activation platforms to do so.
Time is money. The time spent trying to stitch customer data together from disparate systems — each with inadequate, incomplete customer profiles — to execute targeted marketing activities will only lead to lingering operational inefficiencies.
We don’t mean solely in your growth-focused teams’ collective customer retention strategy, but also in your entire company’s customer engagement approach.
The dynamically updated single customer view in our CDP allows you to understand who’s highly engaged and purchasing often as well as those whose engagement has slipped and, thus, require immediate attention to retain their business.
And because the data is actually unified in a single place, you can much more efficiently activate and target the necessary programs to immediately impact customer retention.
2. Use customer insights to inform your personalization.
How long your site visitors check out specific product pages. When an individual served one of your ads clicks through. Which devices your prospects use during site sessions.
Customer insights like these are crucial to many companies’ customer retention strategies, as they can reveal important details about individuals’ engagement:
- With them, you can understand the micro-interactions of your audience: on your site, across your social media presence , in your advertising, and via your email campaigns.
- Without them, you’re left in dark about customers’ actions and unable to strategically improve your digital tactics and channels to keep them engaged (or reengage them).
BlueConic customers can take advantage of our Profile Recognition Dashboard to see their prospects’ and customers’ distinct behaviors and traits. This dashboard can tell them:
- Who’s a first-time customer or site visitor
- Who’s an anonymous or known contact
- The attributes compiled for each individual
The more demographic, behavioral, engagement, and purchase data BlueConic customers collect about individuals over time, the more their customer recognition ratio will grow — and the more easily they can use the insights in their retention marketing.
By setting up profile merging, behavioral listeners, and external trackers, BlueConic users are able to gather unique identifying information (i.e., identifiers) for their contacts.
As they accrue more and more identifiers, our customers are increasingly able to determine who seems likely to churn down the line and craft the necessary customer retention strategy.
Notably, one that can maintain their business (e.g., publishers preventing content subscribers from canceling) and make customers feel ‘seen’ (e.g., individualized email deals).
Simply put: Highly personalized messaging tailored to each individual customer based on intricate insights associated with their persistent customer profiles in BlueConic is how leading companies who use our CDP grow their customer retention rates.
3. Provide premier customer experiences to grow CLV.
Marketing strategist Jes Kirkwood said it best: CX is “one of the two core pillars of customer retention; the thing is, you can’t grow if your customers don’t stick around.”
Fail to supply your customer base with a top-tier CX on all channels and touchpoints, and you’ll see customer engagement with your organization dip across the board.
Identifying high-risk customers — those seemingly about to churn, based on behavioral analysis and predictive models you run in our CDP — can help you figure out how to reengage them, improve their CX, and, at the end of the day, enhance your retention odds.
Going back to our point about the pros of personalization:
- One-third of marketers said “proactively engaging at-risk customers with personalized offers” based on products or services viewed or bought improves their customer retention rates the most.
Show customers you care about their CX . Then, many (if not most) will reward you by returning to your website, app, and/or brick-and-mortar location to make repeat purchases.
(In other words, their customer lifetime value (CLV) will only grow in time.)
When two-thirds of businesses say calculating the CLV of their buyers and subscribers helps them grow their retention rates, you know it’s a must-measure marketing metric.
Everyone from retailers and membership organizations to travel and hospitality brands uses CLV as the compass that guides their distinct customer retention strategies today.
More specifically, they use the metric to ID individuals and segments whose lifetime value scores may be minimal at the moment but could grow exponentially by gaining a deeper understanding what has prevented them from becoming loyal customers to date.
Boost your overall customer retention retention strategy with a CDP
There are certainly other intricate customer retention activities you can execute with a CDP that can preserve customers’ business (and improve your overall marketing ROI):
- Use geo-location data to provide individualized discounts via SMS or email to disengaged customers based on their location (i.e., near a brick-and-mortar store).
- Compile customer feedback through personalized surveys to segments of likely-to-churn subscribers to figure out what your organization can do to prevent them from canceling.
- Evaluate NPS scores to gauge customer satisfaction levels and develop an action plan to make unsatisfied customers happy (e.g., reduce subscription pricing, offer freebies).
- Incorporate social proof (e.g., product review or brand testimonials videos featuring customers) in your targeted messaging to “lapsed” customers to reengage them.
But none of these tactics and techniques can move the needle regarding your customer retention strategy without factoring in the aforementioned traits in your approach — and adopting a CDP like BlueConic as the guiding force behind your retention efforts.
Request your BlueConic demo today to learn how our CDP can help you not just improve your customer retention strategy, but also transform your business for the better.