Customer Experience

How 9 Successful Companies Keep Their Customers

How 9 Successful Companies Keep Their Customers

No one likes to be dumped. But companies are blindsided every day by customers who leave them. Often, companies don’t see it coming: in fact, 91 percent of customers leave without any explicit warning.

Related: 3 Tips to Align Your Startup's 'Core Value' With Customers'

To the entrepreneur, losing a customer often seems personal, not just a statistic. But in terms of business success, startups now more than ever need to show not only that they can attract customers but that they can keep them. Increasingly, investors look at customer retention to determine whether an entrepreneur's product or service will ultimately succeed in the marketplace.

Through my work at Sparked, a predictive analytics customer-retention platform, I’ve spent endless hours working with companies to determine if their customers are getting value from their products, whether they’re likely to stick around or not and how to keep them.

There are many examples of successful companies that have innovated to ensure that their customers have a great experience, receive value and stay loyal. So I reached out to colleagues, friends and fellow entrepreneurs who have been particularly impressive at building ongoing relationships with customers. I asked them to share tips that have driven their success.

Their resulting insights about 9 companies provide a wealth of best practices for any entrepreneur looking to establish a growing and loyal customer base:

1. Dollar Shave Club: Know thy customer.

Dollar Shave Club: delivers razors and other personal grooming products

Dollar Shave Club is a viral branding-powerhouse with quite possibly the best-ever startup video (over 18 million views). But Janet Song, SVP of member Services, says she won't let Dollar Shave Club rest on its branding laurels: The company is a big believer in using technology to understand its members. Using a powerful system to integrate its in-house CRM, customer support platform and data analytics, Dollar Shave ensures that it has a rich understanding of its members -- so that it can deliver an outstanding customer experience. “We don’t respond to situations; we respond to people,” is the philosophy that drives the company's member engagement. Dollar Shave Club now has over 1.5 million happy subscribers, who not only enjoy the brand, but also participate in a great relationship with the company.

2. Etsy: Dig deep to find what really drives your customer.

Etsy: global community of entrepreneurs who use the site to sell what they make or curate

While most Amazon and Ebay users go to these sites to purchase a specific item they already have in mind, Etsy knew early on that its users come to explore, discover and buy new, unique things. To facilitate this, Etsy knew it needed to present interesting products to viewers, to personalize the user journey in such a way that visitors see products that resonate with them. According to SVP of product Mike Grishaver, the team has been hard at work on functionality that can recommend products based on factors that go beyond what people have looked at. The result is an experience that surprises shoppers with unique new items and engages them to find more. Grishaver advises other companies to “look beyond the basic mechanics of what users can do on your site. Find the deeper experience that makes them feel more connected and then infuse that into every part of their experience with you." For Etsy, web and mobile-feed engagement jumped immediately after the company instituted enhanced data analytics. They clearly paid off: People have discovered new products that uncannily reflect their personalities and interests.

3. StumbleUpon: Unite internally to improve externally.

StumbleUpon: "discovery engine" that finds and recommends web content to users

StumbleUpon realized that driving user engagement required more communication and better integration across its data, engineering, product and marketing teams. Through a companywide initiative, the data team delivered more actionable insights; the product and engineering teams worked more closely to methodically test how features and fixed functionality affected engagement over time; and the marketing team looked at the long-term behavior of the different types of users StumbleUpon targeted. Annie Gherini, head of marketing, notes that, “The age of departmental silos is over, and the unified efforts of all functional teams ensure that everyone is reading from the same playbook, resulting in an awesome user experience.” The company's efforts resulted in a marked jump in both the frequency and length of user visits to its site.

Related: The Secret to Getting Repeat Customers

4. PlentyOfFish: Test methodically.

PlentyOfFish: dating site

Any company’s intuition and anecdotal observation is critical, but methodical analysis and testing takes user experience to the next level. While PlentyOfFish’s team has done an amazing job building a product that’s attracted 90 million users, team members don’t rest on the laurels of a clearly proven, well-liked product. PlentyOfFish may deal in dating and love, but on the business side it's analytically savvy and believes in constant optimization through split testing. Agata Osinska, director of product, notes: “We are methodical about testing. You need to be disciplined about setting tests up to give you clear, accurate results. You can’t try to test too much at the same time or you end up with a jumbled mess.” PlentyOfFish has been optimizing its product with relentless testing, and has seen a distinct increase in user engagement rates since implementing a more rigorous testing process over the past year.

5. Bitly: Educate customers about the full value of your product.

Bitly: URL shortening service

Users don’t always understand the full value of your product. Users, for example, thought of Bitly solely as a link shortener, to be used only occasionally. But the information that Bitly gathered about people who clicked those links -- their motivations, desired content, etc. -- provided powerful insights to marketers. Bitly’s CEO Mark Josephson notes: “I saw the immense power of Bitly and realized that customers needed to rethink who we were and what we did. We refocused the entire company on helping marketers get the extensive value our product offered that they hadn’t realized to date; and it revolutionized our customer experience and value.” Bitly is now perceived and valued as a marketing tool that provides ongoing value via customer insights. By educating its customers, Bitly managed to achieve more frequent engagement for longer periods of time.

6. Cratejoy: Make customer retention a KPI.

Cratejoy: platform for merchants to launch a subscription commerce business 

A comprehensive, one-stop solution, Cratejoy launched just last year but quickly closed a $4 million venture round due to the power of the subscription economy and the company's understanding of how to help subscription enterprises succeed through customer retention. Co-founder Amir Elaguizy acutely understands that customer retention is the key to success, and while recognizing that most of his entrepreneurs are focused on customer acquisition, he’s made customer retention a key key performance indicator (KPI) on the dashboard for everyone who has started a subscription company through the Cratejoy platform. As a result, companies using the service boast higher customer retention than the industry average, ensuring that Cratejoy's company founders keep the early customers they worked so hard to attract.

7. MeUndies: Beware of discounting.

MeUndies: makes men's and women's comfortable underwear

While discounts may attract more customers, MeUndies realized that when customers are initially and primarily motivated by savings, they often make only one purchase (if buying a la carte), or they quit their new membership (if they've chosen the subscription option). But MeUndies had a fun, quality product and a great community of users so it wanted to focus on building its base of enthusiastic supporters and high-value customers. Dan King, head of business development, says: “We found that if users signed up at full price, they were more likely to remain loyal than users who would sign up with a discount. We then gave our ‘full price’ customers discount offers later to reward them for their loyalty, after we already had established a great relationship with them.” MeUndies now attracts new customers with a higher lifetime value, so its marketing ROI is compelling, and its customer base, more active and energetic.

8. Unbounce: Focus on quality customers.

Unbounce: assists startups with landing page optimization

Upon launching in 2009, Unbounce immediately attracted many new customers. However, it soon learned that some of these new customers misunderstood Unbounce and actually didn’t need a landing-page optimization tool. As a result, these particular customers tied up support resources before ultimately quitting. Unbounce is a powerful tool, though, and marketers who actually do a lot of A/B landing-page testing are typically long-term customers. So, Unbounce learned to drive uncertain leads to freemium membership plans to ensure they understood the product before converting to paid membership.This improved the fit of members who ultimately signed up, and the customer success team could focus more on high-value customers. CEO Rick Perrault drove the company’s customer-focused culture and championed this mission to improve Unbounce's customer success efforts and, ultimately, its customers' experience. Says fellow co-founder Jason Murphy: “Startups have limited resources. Make sure you attract customers who really need your product so your time supporting them is well spent. Customers that aren’t a good fit for your company often take a lot of your time, and leave relatively soon.” Unbounce now has a high engagement retention rate, with an active customer-success team working with well-targeted and high-value customers.

9. Insightly: Drive people to your product’s most valuable features.

Insightly: provides online customer relationship and project management software

While many small-to-medium businesses (SMBs) shy away from implementing CRM software because they see it as an enterprise tool, Insightly’s user-friendly CRM system has attracted a large and loyal user base. However, Insightly was not content with just attracting new customers who were curious about the software; instead, it wanted to double down on ensuring that those SMBs knew how to maximize value from software they’d never used. To achieve this, Insightly pinpointed the four product features most influential in driving customer retention. It then monitored which customers were not using these product features, and created outreach campaigns (email, video tutorials, FAQs, etc.) to drive usage. Lynn Tsoflias, VP of customer success, suggests that entrepreneurs focused on customer retention should “guide customers to their goals and help them gain the maximum value from your solution.” By driving people to its most useful product features, Insightly has established high customer retention and customer satisfaction rates.

All relatively early-stage companies call themselves customer-centric, but only actual success retaining customers proves that they've nailed the customer experience. If customers keep coming back, then you know you’ve created a quality product, experience and relationship. From early-stage companies to mature ones, companies are quickly growing their customer success and customer experience teams, using new off-the-shelf technologies to help them better understand their customers.

Their aim is to make sure that customers get value from their products and remain customers for the long term. The above tips will help you keep the customers you’ve worked so hard to attract and engage, so you’ll enjoy a growing, loyal, and energetic customer base.

Related: 3 Great Ways to Create an Emotional Bond with Customers