5 Proven Customer Retention Strategies to Build Lifetime Customers | Magic Assistant Blog

5 Proven Customer Retention Strategies to Build Lifetime Customers

Li Ramos
Li Ramos
July 12, 2022
Magic customer support assistant

Customer acquisition and retention are both crucial elements in boosting profits. While getting new customers is great for business, keeping existing customers has a better return on investment (ROI). In fact, profits increase by as much as 95% with just a 5% gain in retention.

Over time, a customer becomes more valuable to your business as they spend up to 67% more than new ones. Moreover, customer retention costs 5x less than customer acquisition! Thus, having a robust customer retention strategy is not only profitable but also cost-saving.

Here’s to keep customers coming back to your business for the long haul.

1. Build a Positive Customer Experience

A consistently good customer experience creates a positive perception of your business, which can get customers to keep doing business with you. Starting your customer retention strategy with unforgettable customer experiences can turn first-time customers into loyal ones.

Building a positive customer experience can be done by identifying and eliminating customer pain points. Then, you should look into increasing customer satisfaction such as providing a smooth customer onboarding process.

Creating an online community can also improve your relationship with customers. A community allows customers to have an emotional connection to your brand and have a platform to discuss and ask anything about your business. This can be built on social media or e-commerce platforms like Shopify.

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2. Personalize and Maintain Communication

Personalization provides humanity to your brand. It also ensures that your message is relevant to your customers. Using your customer data and creating audience personas for your preferred channels can provide a more personalized approach to interacting with people.

You should also regularly engage with your customers on social media. Be sure to show that you are actively listening and empathizing with them by using positive scripting.

Stay connected with your existing customers through email newsletters to build lasting relationships with them. It can be about your latest product or feature, promos and offers, partnerships or company milestones, informative articles, and other exclusive content.

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3. Incentivize Customer Loyalty

One of the simplest but effective customer retention strategies is making customers feel appreciated. Thus, rewarding existing customers with free subscription periods or introductory pricing can lessen their odds of jumping to your competitors.

Gamification is also another way to improve customer retention. By harnessing people’s competitive spirit in a fun, engaging way, you get a win-win situation for both parties. Customers can get gifts and discounts while your business gets customer data insights and social media engagement.

4. Deliver Excellent Customer Service

Another area to focus on in your customer retention strategy is providing reliable and timely customer service. According to Khoros, 83% of customers are more likely to be loyal to brands that respond to and resolve their complaints.

Provide customer service through various channels (phone, email, website, social media, etc.) to make it easy for customers to get their problems solved. A live chat feature can also help you provide immediate assistance to customers. 

Customer service also extends to knowing how your existing customers feel, so take time to collect customer feedback. It’s also important to close the loop with your customers by sending a personalized thank you message.

5. Monitor Customer Retention Metrics

To maximize your customer retention strategies, you have to track and measure their performance. This way, you’ll know which areas of your customer retention plan need focus or adjustments.

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Some customer retention management metrics you should monitor include:

Also called churn rate, it is the percentage of customers lost in a certain period. This is calculated by dividing the number of customers lost in a given time period by the total customers at the beginning of this time frame.

It is the percentage of customers who have made at least two purchases during a certain period. This is calculated by dividing the number of return customers by the total sum of customers and multiplying it by 100.

It measures how valuable the customer is to your business. This is calculated by multiplying all the averages below:

  • Average Purchase Value: Total Revenue divided by Total Number of Sales
  • Average Purchase Frequency: Number of Purchases divided by Number of Unique Customers
  • Average Customer Lifespan: Sum of Customer Lifespans divided by Total Number of Customers

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With a well-planned customer retention strategy, you can better gauge what your customers need and ultimately win their loyalty. Magic can provide ways for your business to keep customers coming back.

Get matched with a Magic Assistant who can take on a variety of roles to support your customer retention strategies:

Email management, CRM clean-up, basic social media posting, research work, and documentation

Cold calling, lead generation, data mining, and lead qualifying

Campaign creation, search engine optimization, and performance analytics

Phone support, chat support, escalation management, and quality management

In just 72 hours, Magic can source, screen, and qualify the best virtual assistants based on what your business needs. All you have to do is book a call with us to discuss your specifications!

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