Marketers are constantly under pressure to generate new and quality leads that convert to paying customers. While acquiring new customers is critical to a company’s success, retaining existing clientele is often overlooked as an essential marketing strategy.

Consider that it costs five times more to attract a new customer than it does to keep an existing one. Research also shows that boosting your customer retention rate by as little as five percent can increase profit by 25 to 95 percent. Loyal customers spend more money, purchase more frequently and are more likely to recommend your company to others. Even with these clear-cut benefits, only 18 percent of companies focus on retention over acquisition.

10 Tips for Retaining Customers

To maximize your customer retention rate, here are some best practices to consider:

1. Know your churn rate.

You can’t fix what you don’t understand. It’s essential to track and analyze your business’s churn rate, or the percentage of customers who stop doing business with you as well as the reasons why they leave. To calculate your churn rate, use this formula:

(Lost Customers ÷ Total Customers at the Start of Time Period) x 100

For example, if your business had 250 customers at the beginning of the month and lost 10 customers by the end, you would divide 10 by 250. The answer is 0.04. The average B2B churn rate is five percent.

2.  Develop and implement a well-conceived onboarding program.

While this will only apply to new customers you bring in, make sure they feel welcomed and appreciated after the sale. Use regular emails to show new customers how to get the most out of your products and services. Video tutorials, on-demand webinars and case studies show new customers how to use what they bought from you.

3.  Do something unexpected.

Every once in a while, surprise and delight your customers with a token of appreciation. Whether it’s a card, a personalized notepad or a subscription to a magazine, tokens of your gratitude go a long way in earning customer loyalty.

4.  Emphasize exceptional customer service.

Keeping a customer on hold for 10 minutes doesn’t tell them they are a valued customer. To deliver a quality customer experience, consider adding service reps dedicated to existing customers and give them the tools and resources they need to solve problems as they arise. Make it easy and pleasant for customers to do business with you.

5.  Pay attention to complaints.

It’s inevitable that a customer will run into a problem. But consider that for every complaint you receive, there are likely dozens more customers who had the same experience but never said a word. Don’t dismiss complaints—use them to identify deficits in product or service offerings and make efforts to improve as needed.

6.  Ask for feedback.

It’s impossible to improve your products and services if you don’t know how your customers feel about them. Create a process for obtaining feedback regularly and share that information throughout the organization. A simple survey that determines your Net Promoter Score is a great place to start. Ask for reviews and testimonials to see what your customers like best about doing business with you.

7.  Build a partnership.

It’s not enough to provide customers with the products and services they purchase from you. To earn and maintain their loyalty, build a strategic partnership that synergizes expertise, security and adaptability. Give them an assigned account representative, provide them with customized content and work to build a relationship where communication is regular and meaningful. Talk with them about their pain points, goals and needs—and work with them to deliver customized solutions that solve problems and help their businesses grow.

8.  Communicate regularly.

Don’t stop communicating with your customers after the sale. Develop a schedule for ongoing engagement and conversations. The formats can include a newsletter, reminder or anniversary emails, educational opportunities or VIP offers. Share your thought leadership over a variety of platforms and tag existing customers to make them feel like they are part of the team. Keep in mind that in an age of digital communication, nothing replaces human interaction.

9.  Keep an eye on customer purchase patterns.

Don’t let an existing customer fade away. If a company hasn’t made a purchase in a while, give them a little nudge toward re-engagement. A phone call can go a long way to determine if there is a new buyer, there was a problem with their experience or their needs have changed. Don’t wait until they’ve stopped buying from you to reach out.

10.  Don’t ignore former customers.

All is not lost if you lose a customer. In fact, you have as much as a 40 percent chance of winning back a former customer—but only if you try. Identify customers who haven’t made a purchase within a specified time period and develop a program for bringing back inactive clients.

Customer Retention Is the Key to Sustainable Growth

The money you spend on marketing and lead generation is wasted if customers are only making one purchase. Smart marketers prioritize customer retention as part of a strategic marketing plan. But focusing on existing customers doesn’t mean ignoring the importance of acquiring new ones. It means keeping your current customers happy and excited about your products, services and company. When you do, they will become your best marketers.

To learn more about how you can create a customer retention program, schedule a call with one of our experts.