How Can Customer Service Increase Your Retention Rate
⏱ Reading Time: 9 minutes
Have you ever received such fantastic customer service that you couldn’t wait to tell family and friends? A good customer experience (CX) makes it much more likely that customers will do business with you again. It increases your retention rate and improves your brand recognition, as happy customers are more likely to tell others about you.
The good news about the pandemic is that customers are more dedicated than ever to the brands they use.
In a study of 3,800 consumers of all ages in the U.S., U.K., and Australia, researchers found 2.4% of customers were more loyal, while 60.2% said their allegiance remained unchanged. What was interesting about the study was that most people said they are devoted to a higher number of brands than in the past.
An excellent place to start is figuring out your average retention rate. How many of your customers stick around for more than a sale or two? Pay particular attention to those who bounce away. Are there any common reasons for their lack of loyalty? What can you fix to improve the situation?
If great customer service improves your retention rate, what are some things you can do to ensure your CX is the absolute best it can be? We looked at some key performance indicators for CX and found ten areas you can focus on to improve your methods and retention rates.
How to Increase Your Retention Rate Through Customer Service
1. Ask Your Customers
Start by sending out a survey to your current customers. Ask them what they like and don’t appreciate about your customer service model. Your clients deal with you regularly. They can tell you precisely what is helpful and what isn’t.
Really listen to their suggestions. You may not be able to implement all of their requests, but simply knowing where your problem areas are can help you alleviate some of the frustration shoppers experience.
Picture 1. Ask for a review
2. Use Chatbots
If you want to see your retention rates soar, add chatbots as an option for communication.
Many people prefer to speak to a bot rather than talking on the phone or waiting for an email response. If your clients are millennials or Gen Zers, this may be even more true, as they like to use technology to problem-solve.
There are many ways you can use chatbots and AI, such as to answer questions, get specific help, troubleshoot, or receive customer feedback. Look for a system that works with both desktop and mobile devices.
While bots are an incredible time-saving and inexpensive tool, you’ll also want some trained live agents to step in when the bot doesn’t have the answer.
3. Plot the Buyer’s Journey
No matter what product or service you offer, your customers take a specific set of steps to get from Point A to Point B. Understanding how the sales funnel works helps you better understand where your clients are in the process.
Once they make it through the journey, where do they restart? They already know your product, so they aren’t going back to the top of the sales funnel and going through the information and awareness stages again.
You can help them skip through some of the steps by providing landing pages for current customers. Send them a text or email reminder with a direct link to a product page or order page. Try to make the journey as seamless as possible, and they’re much more likely to stick with your brand for the ease of re-ordering.
4. Onboard New Customers
You probably already have an onboarding process for employees, but did you know you can do something similar with your customers? Taking the time to explain everything in detail to new customers allows them to hit the ground running. They will know how to use your product or service without the issues they might otherwise run into.
Making sure your clients feel comfortable from the very beginning keeps them engaged and may improve your retention rate. For software as a service (SaaS) companies, users won’t want to learn a new system. A great onboarding experience may be what keeps them with your company long-term.
Offer several options for onboarding to meet the needs of different clientele. Create videos the consumer can view, offer one-on-one help to get up and running, and have articles and FAQs to answer any obscure questions.
Picture 2. Example of customer onboarding
5. Tap Into New Technology
In addition to adding chatbots, be open to new technology as it arises. The CX on your website might be improved by making the site compatible with voice search. How well does your site adapt to your mobile users? Is the design responsive to smaller screens?
Pay attention to technology as it emerges. For example, how can you add augmented reality (AR) to the shopping experience? Think about brands such as IKEA that provide an app to plug an item into an image of your current rooms.
How might your business work with AR or VR to create an experience for your users? If they get everything they need from you, why would they ever go anywhere else for their needs? You might improve your customer retention rate by merely offering cool shopping features.
6. Fix Known Problems
No matter what product or service you offer, you’ll encounter a problem or two that occurs over and over again. Chat with your customer service reps about the number one reason clients call for help.
Once you’ve identified the issues, take the time to either improve the product or develop a plan of action to prevent the call in the first place. Educating your customers might prevent aggravation. For example, one infrared disinfecting light has a common complaint of not turning on unless you hold the power button down for three seconds.
The company knows this is a problem. They get calls every day of the week from frustrated new customers who can’t get their wands to turn on. To combat the issue, they created articles and videos on their support page. It’s one of the first things a consumer sees when they land there.
Not only does this remove an element of frustration for the user, but it saves customer service teams time and effort.
7. Personalize the Experience
In a survey, researchers found that 70% of millennials are tired of brands sending irrelevant emails. They want highly personalized messages that apply to their lives. Personalization might be why half of the younger generation prefer to shop in-store instead of online.
Want to improve your retention rate with millennials? Start by segmenting them according to their interests. You can then create highly targeted emails personalized to their needs.
If you see they’ve ordered something recently, let them know when you get a similar product in. Reach out and ask for their thoughts on their recent order. Use their first name to show they are more than just another number on your list.
8. Invest in CRM
Do you have a strong customer relationship management (CRM) system? One way to keep your customers satisfied and your brand reputation at an all-time high is by reaching out to them regularly.
Know when your customers’ birthdays are and wish them a happy day. Send a discount code on the anniversary of their first order. Ask for details about their likes and dislikes and track those in your system so that you can segment them appropriately.
An excellent CRM system also notifies you if it’s been a while since they ordered. You can send a gentle reminder that they may want to check out new arrivals or ask if they need help with anything.
9. Exceed Expectations
It’s fairly easy to figure out what your customers’ expectations are and meet them. What creates true loyalty to a brand and improves your retention rates is when you go above and beyond what customers expect.
Think about some of the stories you’ve heard, such as a garage door installation company coming out in 2 feet of snow to fix a door that wouldn’t close, or a grocery chain delivering to an older man even though they didn’t have a delivery service at the time.
See your customers as human beings, and it becomes much easier to rise above what they expect and give them such exceptional service they’ll never go anywhere else for what you offer.
10. Focus on Omnichannel Experiences
With people staying home more, they’re looking for ways to reduce their trips to brick-and-mortar stores. Consider how you might meet this need for your current customers. If you have a small physical location, can you add curbside pickup? Does your website allow for delivery of at least some items?
As you add other options for your shoppers, also consider how the areas might mesh. If someone orders a shirt online and it doesn’t fit, can they return it to your physical store? What about if they buy in the store and want to exchange via mail? Do you have a process for that?
A good example of an omnichannel experience is Amazon.com. For many items fulfilled by Amazon, if you purchase something and want to return it, you have several options. You can ship it back via UPS. Or you can take it with only a code and the item to drop points such as Kohl’s and the UPS store. You don’t even need a shipping box to initiate the refund.
Picture 3. Omnichannel experience
Rework Your Processes Frequently
Take time every six months to look at your customer service process and revamp anything that potentially harms your retention rate. When you do get calls from frustrated patrons, what do they say? Can you fix those issues so they don’t occur again? How is your team handling irate or confused customers?
Look at everything through the lens of providing the best CX possible. With a little added effort, you’ll easily keep your customers and gain new ones as your reputation grows.
Eleanor Hecks is editor-in-chief at Designerly Magazine. Eleanor was the creative director and occasional blog writer at a prominent digital marketing agency before becoming her own boss in 2018. She lives in Philadelphia with her husband and dog, Bear.
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