Must-Do Customer Retention Tips: Examples of Successful Brand Strategies
In the present day, the market is highly competitive and aims to acquire new customers and markets. However, keeping them hooked and retained is still the hardest job for a company. That is unless you have capped on the customer’s deepest demands such as a Mac lipstick user who may never switch unless someone beats it.
Moreover, once a customer goes through your purchase funnel and customer service – retention is cost-effective and sustainable, if done properly. A study by Harvard Business Review shows that increasing customer retention by 5% would increase profits by a hefty 25% to 95%. The key is “keeping the right customers” that prove to be valuable.
This makes sense and according to marketing experts, it is better to nurture the relationships that exist through exceptional customer service. It leads to good word-of-mouth, which is a crucial step when retaining customers.
We will be running down the top 3 customer service points to include in your business activities that improve customer retention and thus the profit margin and brand perception. We have detailed each with examples of brands running their business successfully by incorporating these top 3 customer service strategies.
1. Personalized Experiences
Customers of today expect customer services to be personalized to their needs. It leads them to feel more valued, understood, and likely to remain loyal to the brand. This process is called customer retention.
Customer experience (CX) counts a lot these days. The customer service reps can use data analytics for tailored communications, offers, and services for customers. This leads to customer experience improving and thus adds to customer retention.
Example of Personalization with Amazon:
Amazon uses personalization to drive customer loyalty. Its recommendation engine, which suggests products based on past purchases, search history, and preferences is key to enhancing the customer’s shopping experience. As a result, Amazon’s Prime membership retention rate is over 90% according to a report generated by Statista in 2023. This means that with improvement to CX, customers are likely to continue purchasing from the platform.
2. Multi-Channel Support
The digitization of the media today has taken the way customer support is handled to new flows. Customers expect the business to provide customer service as they wish it to be delivered. That is through the variety of channels available today.
Brands that have kept this in mind when delivering, have taken advantage of retaining their old customers. For example, a customer purchasing a product from Instagram will prefer to talk to the CS on the platform, and not through WhatsApp.
One other example that comes with offering multi-channel support is offering a variety, or at least the mainstream of languages available across all channels. In this regard, Optimum, an internet service provider in the U.S., offers support across its channels in both English and Spanish. With 24/7 Optimum servicio al cliente en español, the brand provides personalized support to its Spanish speakers regarding internet service. In America, the two highest-spoken languages are English and Spanish.
People also want to have a variety in terms of communication channels, such as chats, phone calls, emailing, social media chats, etc. The availability of all streams makes it easy for customers to stay loyal to the brand.
Example of Multi-Channel Support with Lush Cosmetics
Lush Cosmetics offers multi-channel support. This support helps the customers to reach out via phone, email, and social media. This flexibility in communication channels has resulted in strong customer engagement and increased retention, as customers can easily reach out via their preferred method. However, tracking and customer data analysis were becoming a mess.
Therefore, in collaboration with Zendesk, Lush achieved an ROI of 369% in a matter of months. The change comes with improved tracking and data analysis across the 900 shops and 38 websites that Lush holds. This change has brought a smooth customer experience and a higher retention rate.
According to an article published on this achievement by Zendesk, Lush has saved an average of $267,468 annually by avoiding additional customer service inquiries that were duplicated. Agents can now offer personalized, consistent support across the many channels, and still locate information more efficiently.
3. Loyalty Programs
The reason we added this to the list is the need and importance of the loyalty programs. A loyalty program is a structured marketing technique designed to reward customers for their loyalty or continued patronage.
These programs offer reward points, discounts, re-purchase value offers, or other incentives to encourage repeat purchases. This also includes encouragement with long-term engagement plans through the brand loyalty programs such as signing up for loyalty offers and getting gifts or some other benefit.
Loyalty programs incentivize repeat business by offering rewards, discounts, or exclusive benefits. According to a report published by Zinrelo on customer loyalty and incoming business, 85% of consumers stick to a brand that offers a loyalty program. By rewarding customers for their loyalty, businesses can increase retention rates and encourage frequent purchases.
Example of Loyalty Program with Sephora
Sephora’s Beauty Insider Program is one of the most successful loyalty programs in the retail industry. It offers personalized rewards, such as points for every purchase, which can be redeemed for free products or exclusive promotions. This program has significantly increased Sephora’s customer retention, with loyalty members spending nearly 15 times more than non-members.
Recently in 2023, they have added gamification to the mix such as challenges and fun quests for the members to earn more points. This new feature is called “Beauty Insider Challenge” which involves tasks both online and offline comprising of non-purchase related tasks. It is a fun and inventive way to hook the customers to its brand.
According to an article studying this program by Sephora, improved engagement leads to a 22% increase in cross-selling and a 13-51% increase in upsell revenue, which is great.
Last Notes
This ends our analysis of the 3 top customer-service techniques you can incorporate in your business like these big names have, leading to your customers being satisfied with the changes.
Businesses that focus on delivering personalized, empathetic, and proactive support can foster long-term loyalty and turn one-time customers into repeat clients.
Moreover, offering multi-channel support, clear communication, loyalty programs, and a seamless return process helps customers feel valued, increasing their likelihood of returning.