In my last article I talked about the basics of customer retention programs – what they are, why you should have one, and some of the important things that they should include. Today I’d like to discuss the five key issues you need to address in order to create a successful customer retention program for your organization. You need to determine:
Do your homework and really understand the stages of your customer life cycle – Identify any common repurchase times or points at which there is an obvious next step that the customer is likely to follow. For example, clothing boutiques may find that their regular customers return when the seasons change. Lay out the customer life cycle, and then overlay this with anything important that’s happening internally at your organization, such as a new product launch.
What’s in your customer database – What contact information do you currently have for your customers? You might have information based on warranty registrations or online purchases, or you might find that you need to start incentivizing customers to give their contact information to you.
The best way to reach your customers – Will you use mail, email, telephone, text or social media? Your choice of communication method might be based on the contact information you have available (you can’t plan an email campaign if all you have in your database is street addresses), your budget, and/or your customers’ stated preferences.
The right messaging and timing – Walking through the customer experience and their touch points with your product will help you figure out what to say and when to say it.
Think of reasons why your customers should be coming back to you. Will the product need servicing every six months? Send them a friendly reminder and coupon. Would the customer benefit from a training class? Invite them to attend your webinar. Does your product make a great holiday gift? Point that out! Are you introducing an exciting new menu item? Give them a free sample with purchase.
How to measure your program’s success – Before you launch a customer retention program you need to decide what “success” will look like and ensure you have a way to track and measure the program’s results. For example, you can track and measure your:
- Customer retention rate (how long customers stay with you)
- Coupon redemption rates
- Average spend or number of purchases for customers on the program versus your pre-program metrics
- Email open, click-through and opt-out rates (and don’t forget to give your customer the option to opt-out!)
- Customer satisfaction rates
What has been your company’s experience with customer retention programs? What’s worked for you, and what hasn’t? Share your comments below.