Client (or customer) retention is essential to the survival of any business. First, it's important to understand why client retention produces more long-term value and costs less than customer acquisition: You've convinced a customer already familiar with your brand to buy again; and that effort will always take less money and effort than introducing a new user to your brand from scratch.
Similarly, retaining a customer means you've positioned yourself for multiple transactions down the road -- not just one immediate transaction, as is the usual focus in customer acquisition. (This factor is especially valuable for subscription customers or retainer clients.)
Still, the trouble is that even with a stellar product and adept customer service managers, your retention rates may eventually underperform. How can you fight back?
Structural improvements are a possibility, but I tend to favor more manageable solutions as a front-line approach. Try these easy-to-adopt strategies to improve client retention in your own business:
1. Use numbers to prove your value.
Customer transactions are an exchange of value -- it’s that simple. Customers give you money for a product or a service they expect will offer utility of more worth than what they invested. Accordingly, your job should be to prove your worth as objectively and logically as possible -- and numbers are the way to do it.
For a marketing or advertising business, this may mean proving ROI (return on investment), the amount of new revenue your client receives for your efforts. Alternately, for a B2C company’s product, this may mean proving quality-of-life factors, like increased efficiency or greater satisfaction. Again, numbers are crucial here; prove instead of persuade.
2. Communicate constantly.
Most client relationships break down when there is some lack of communication. For example, a client may not be able to reach you, or you may have miscommunicated a key detail about the campaign. To resolve this issue, communicate often, and as accurately as possible.
It’s hard to monitor the next point, but the more touchpoints you have, the fewer gaps there'll be, which means fewer vulnerabilities under the weight of which your relationship may decay. Offer meetings as needed, and offer exchanges in between those meetings. Proactively identify problems or mistakes, boast your accomplishments when they happen and don’t be afraid to admit your mistakes.
3. Under-promise and over-deliver.
You can also improve client retention with a simple policy of under-promising and over-delivering. Missed expectations are a big reason for client departures, and these two steps are the way to repair those expectations.
Before committing to anything (a deadline, performance metric or particular service), do your research and create a reasonable expectation to communicate about your capacity. Then, promise a little less than you think you can handle (e.g., delivery Wednesday instead of Monday). From there, you should find it easy to exceed expectations consistently. Remember, what clients remember isn’t what expectations you’ve set, but how effective you were at meeting those expectations.
4. Add personal touches.
No matter how digitized our society becomes, people still crave human interaction. Adding personal touches to your work does a number of things for your brand, all of which increase customer retention. First, your company is humanized -- people have a harder time parting with a business that has a human face.
Second, your brand remains top of mind: Because customers think about you more often, you’re automatically seen as more favorable. Third, personal touches give you an opportunity to get feedback on your brand.
As for the personal touches themselves? That’s up to you: Muffin baskets and hard-copy thank-you notes are good ways to start.
5. Evolve with the times.
One of the best ways to prove your value to a client isn’t to consider how you’ve fared in the past or what you’re like in the present, but rather how you’re going to be in the future.
Prove to your clients that you’re actively investing in yourself, by upgrading your technologies, offering new products and generally evolving with the times. When clients look for a new vendor, it's not for someone who can meet their needs today -- they’re looking months, if not years, down the line. If you’re the option with the greatest potential for the future, they’ll never want to leave you (even during hiccups in your relationship).
Obviously, the entire scope of client retention can't be captured here; these strategies don’t address every retention problem. But these five concepts should serve as an initial direction to help you proactively identify better ways to retain your clients.
Related: 3 Ways to Monitor Customer Churn
Because even a handful of retention success can mean ongoing value for your business, you owe it to yourself to prioritize this task; don’t let your best clients slip through your fingers.