5 Ways to Keep Customers Coming Back

Posted November 21, 2014

By JT Ripton

Creating strong customer loyalty is one of the best things you can do for your business. According to a report from the Harvard Business School, an increase in customer retention rates of just 5 percent will result in a profit increase of 25 to 95 percent.

This is an important detail to consider as you develop customer experience strategies. Finding ways to keep customers coming back is as important as finding new customers—and it costs less, too. Here are five effective small business tips to increase retention rates.

Customer Retention Tips for Small Business

1. Stay in Touch with Your Customers

It may sound too obvious to mention, but a surprising number of business owners don’t touch base with their customers—or they find it difficult to do so. Making regular contact with customers through email and direct mail is one of the best ways to keep your business at the forefront of their minds.

Digital marketing represents a greater chunk of the market now, and the unrelenting popularity of smartphones means that people are more likely to get their information from a mobile device. Collecting customer information lets you continue to nurture the customer relationship long after the first sale. The most common way to maintain contact with customers these days is through email, but text messages sent directly to a person's phone have been proven to be much more effective.

Small business marketing: Customer satisfaction

2. Encourage Bigger Initial Purchases

Generating customer loyalty means targeting your customers at all stages of the sales process. According to analytics company, SumAll, the chance of a customer coming back relates directly to the amount of money he or she spends on the first purchase.

Dane Atkinson, SumAll's CEO, backs this up by saying that people who spend big on an initial transaction are almost "twice as likely to return as those who spend the least." This highlights the importance of not only having a great sales funnel, but to have thoughtful, enticing upsells in place as well.       

3. Get Personal

In a world of abundant choice, customers need strong incentives to remain loyal to one company. One powerful way to ensure that your business remains at the top of the list is to affect the customer's emotions. When customers receive a more personal customer experience they can develop a hard to break emotional attachment to the business.

Researchers from the Journal of Applied Social Psychology conducted a study and found that waiters were able to increase their tips by 23 percent by carrying out one simple act. If a waiter simply returned to a table with a second set of mints, the customer felt satisfied enough to leave a bigger tip.

This is due to the personalized service; it affected customers on an emotional level and ensured an enjoyable and memorable experience.    

4. Don't Overlook the Power of Loyalty Programs

Loyalty programs have been severely overdone in recent years, and the average person now has 18 to 20 loyalty cards. However, despite the appearance that loyalty schemes don’t actually inspire loyalty, do not overlook their value.

The trick is to get creative with your loyalty programs. Instead of cards and points, why not offer customers direct discounts on future purchases? Going back to the personal approach, you could send the customer special loyalty offers designed specifically for them.   

5. Keep Things Fresh

Internet consumers expect instant gratification, and the majority of them always look for something fresh to hold their attention, albeit briefly. It's more important than ever to keep your website interesting and fresh. This is one effective and relatively simple way to keep the customer coming back.

Maintain an interesting blog that encourages the customer to engage with your business. You can also use the blog to share business news and other tidbits that the customer will look forward to reading. In addition, you can keep things fresh by showcasing new products or services from time to time.

Applying a variety of strategies that encourage return customers is very important for business growth and profitability. No one strategy will do the trick. And, like most other aspects of your business, don’t forget to test, tweak, and improve. A happy customer will more than likely remain a loyal customer, which is good for business.

JT Ripton is a freelance business, marketing and technology writer who has written for companies such as T-Mobile. You can follow him on Twitter @JTRipton.

Do you have a comment or question about this article or other small business topics in general? Speak out in the SmallBusinessComputing.com Forums. Join the discussion today!

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