So much attention is paid to customer acquisition by marketers today. Not nearly as much time and energy is spent on cultivating effective customer retention strategies.
You don’t need us to tell you the (many and obvious) benefits of growing your customer retention rate in addition to improving your acquisition numbers and other critical metrics.
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 brands’ “leading objectives” in 2019.
We’ve already shared a churn prediction guide to help marketers learn how to anticipate attrition with advanced machine learning models, such as those offered in BlueConic.
Preventing churn and retaining customers obviously go hand in hand. But modern customer retention strategies entail much more than just simply keeping customers from the door.
Rather, a robust retention strategy requires a concerted focus on your customer base. More specifically, it means making all of your customers happy and building long-term loyalty with them so you can grow at the speed and scale expected of you by your C-suite.
Three effective customer retention strategies to implement in your marketing
With that in mind, here are three of the most effective, widely executed customer retention strategies any organization can implement today to keep their buyers around for a long time — and all with help from the ideal martech: the customer data platform (CDP).
#1: Adopt an analytical mindset — and the right database.
The adoption of data-driven marketing tech isn’t anything new today (though the agile-vs.-waterfall martech adoption debate remains a hot one in the marketing industry).
Most brands leverage a number of customer-oriented data solutions. They use business intelligence (BI) tools, website analytics systems, customer relationship management software, and the like to evaluate marketing to prospective and existing customers and inform adjustments to them.
All these solutions are pivotal ones to any brand’s martech stack. But the value that can be extracted from them is limited without their historically siloed data integrated with a CDP.
For instance, you may use BI tools to compile customer data from other martech. But if the data from those tools is only unified to derive insights and you can’t take action on the data within the solutions in question, you are 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 (social media ads, personalized emails, on-site messages). If it’s not, you’re left to turn to multiple activation platforms — social automation tools, ESPs, adtech platforms — to do so.
Time is money. The time spent trying to stitch data together from disparate systems — each with inadequate, incomplete customer profiles, due to lack of data unification — to actually execute marketing activities will only lead to lingering operational inefficiencies. We don’t mean solely in your customer retention strategy, but rather your entire marketing program.
In short, the CDP is the heart of your martech stack and overall marketing efforts.
The dynamically updated single customer view you get for each buyer, subscriber, and prospect in your 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 one of your website visitors checks out specific product pages. When an individual served one of your targeted 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 users can take advantage of our Profile Recognition Dashboard to see their customers’ and leads’ distinct behaviors and traits. This dashboard can tell you things like who’s a first-time buyer or site visitor, who’s an anonymous or known prospect, and the types of profile information you’ve accrued for given contacts (name, email address, phone number, etc.)
The more demographic, behavioral, and contextual data points BlueConic users collect about these individuals over time, the more their customer recognition ratio will grow in our platform — and the more easily they’ll be able to transform those insights in their customer retention marketing.
By setting up profile merging, behavioral listeners, and external trackers, BlueConic customers are able to gather unique identifying information (or identifiers) for their contacts.
As they accrue more and more identifiers, these marketers are increasingly able to determine who seems likely to churn down the line and craft the necessary customer retention strategy to maintain their business (e.g., publishers preventing content subscribers from canceling) and make customers feel wanted (e.g. SaaS companies reengaging “cold” clients through customer service programs).
Hyper-personalized, high-converting messaging tailored to buyers based on customer insights associated with their profiles — for instance, retargeting campaigns that feature recommendations for recently viewed products — is how today’s top marketers steadily grow their customer retention rate.
#3: Provide premier customer experiences to grow CLV.
Growth marketing strategist Jes Kirkwood said it best: “Customer experience 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 through all promotional messaging, and chances are you’ll see customer engagements with your brand dip across the board.
Identifying high-risk customers — those seemingly about to churn, based on behavioral analysis and predictive models you run in a CDP — can help you figure out how to reengage them, improve their customer experience, and, at the end of the day, enhance your retention odds.
Going back to our point about the pros of personalization: One-third of marketing professionals said “proactively engaging at-risk customers with personalized offers” based on past products or services they viewed or bought improves their customer retention rates and loyalty efforts the most.
Show customers you care about their CX, and many (if not most) will reward you by regularly returning to your website, app, or brick-and-mortar location to make repeat purchases.
In other words, their customer lifetime value (CLV) will on grow in time.
When two-thirds of organizations 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 retail and ecommerce companies and membership organizations to travel and hospitality brands uses CLV as the compass that guides their customer retention strategies.
More specifically, these businesses use the metric to pinpoint individuals and customer 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 strategies you can implement with a CDP that can preserve buyers’ 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 the high-level approaches here are the most proven customer retention strategies leading brands execute today — and the ideal ones to start with after onboarding a CDP.