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Tax & Business Tips

Ideas to Improve Customer Retention

By November 18, 2021No Comments

Retaining your current customers is a great way to ensure your business remains profitable. Here are some suggestions for maximizing customer retention:

  • Track and analyze retention metrics. There is an old saying attributed to Peter Drucker, “What gets measured, gets managed.” So measuring your active customers this year versus last year will not only tell you who you retain, it will also tell you who you lose! Track your retention rate as a percent of last year, then compare the number over time to see if it improves or worsens.
  • Obtain customer feedback. If you can identify customers no longer ordering, talk to them. Find out why they no longer use your products or services. Then try to reactivate them. It may not work, but the information they provide can be very powerful to help retain your current customers. If customers are not readily identifiable, consider creating a process to collect customer feedback on a regular basis, then share that information with your employees.
  • Be proactive with customer communication. Understand your customers’ normal buying pattern and then organize your communication around this pattern. An extended period of no communication can easily lead to customers wandering into other alternatives. So consider a contact plan to re-establish your customer relationship. If you have multiple products and services that a customer may be interested in, consider these calls as an opportunity to up-sell and cross-sell. But find the balance, as too much communication can also turn off your customer base. Look for opportunities that your customers will welcome.
  • Send a newsletter. Newsletters are a great and easy way to stay in touch. Mix in topics related to the problems your products and services solve. Even better, consider mixing in topics that are generally helpful or that show your firm’s culture. So if your group was out helping the elderly clean up their yards, or donating products to those who need them…let everyone know. Or perhaps an article relating to protecting yourself from hackers, or talking about hot trends. The key is to get your customers to engage and connect your name with something useful and interesting. The simple act of a newsletter arriving in an inbox keeps your company top of mind.
  • Differentiate your product or service. Try to understand why your most loyal customers come back to you over and over again. Understand what it is and then try to put this information in your marketing and retention plans. These reasons can be a meaningful point of difference for your company. A differentiated service offering that solves your customer’s unique pain points will always help you retain customers in the long run.

Please call if you’d like help analyzing your business’s customer retention strategy or brainstorming ideas to reinforce your customer retention program.