Customer retention occurs when businesses conduct themselves in a way that results in repeat business, thereby retaining their customers.
Customer retention strategies should be executed from the moment that a customer becomes a customer, and should extend throughout the lifetime of the relationship. Retaining your customers long-term will largely rely on your ability to service them. Customer retention strategies and maintaining a standard of excellence through great service will not only improve your ability to retain your customers, but will also result in positive word of mouth which will lead to additional new business.
The most successful brands put the value of their customer before profits through investing in providing a superior service and striving to not meet but exceed their customers’ expectations. This model leads to brand loyalty that can last a lifetime. There have been studies released that have substantiated the direct correlation between customer retention and a company’s overall profitability. While customer retention involves investment, the long-term payoff is immense. One study showed that engaged customers generate 1.7 times the revenue than normal customers do.
Brands need to have different customer retention strategies for different demographics. Older consumers represent the most loyal demographic. Brands must adopt customer retention strategies aimed at targeting these consumers and making their needs a priority. Small considerations like package sizes, legible labels with larger text, and packaging that’s easy to open are some examples of ways that a brand can go above and beyond the call of duty to retain customers in this demographic.
Older consumers are habit driven. They like to visit the same retailers again and again and tend to be very brand loyal. They are also more apt to spend more time at retail locations. The older demographic responds to service. In-store demonstrations and product testing are important if a brand plans to lure a customer in this demographic away from the brands they are currently loyal to.
Retaining these customers is less challenging because they have a tendency to fall into a habit. The fastest way to lose a customer in the older demographic is to allow your products to become unavailable to them. When retailers don’t restock a brand’s product on the shelf, it forces the consumer to try a different brand if they don’t want to endure the inconvenience of going to another retailer to look for the product. If the customer likes the new product that they try, in many cases the original brand will lose the loyalty of a customer in an older demographic.
Brands need to ensure that their products are consistently available across all retailers where their products are available, and counting on retailers to ensure this is a risky proposition. This is one area that brands should invest in and make a part of their customer retention strategies.
Customer retention strategies result in brand loyalty, and in the consumer packaged goods industry brand loyalty is the reason that some brands become a household name. The most successful brands at retail are only successful because of their ability to retain customers.
For more information about customer retention strategies, or if you would like more information about Storesupport’s services for brands, please contact us by calling 1 (877) 421-5081 or visit www.storesupport.ca.