Loyal customers tend to spend more money, more frequently. In fact, according to the aforementioned Belly study, 70% of merchants’ revenue comes from loyal customers. Every customer you retain saves your business the cost of acquiring a new customer to replace him.
How does empowerment impact the customer retention?
Companies that empower their employees have 50% higher customer loyalty. Empowering a customer care team means encouraging and equipping them to easily find solutions to problems and truly do whatever it takes to make the customer happy.
Why is customer empowerment important?
Customer empowerment is when you give your customers the information and the tools that they need to make a decision. By giving them resources and options, you’re providing them with a much better buying experience and allowing them to determine the kind of experience they’d want to have with your brand.
Why is customer retention so important?
Why is customer retention important? Customer retention measures not only how successful a company is at acquiring new customers but also how successful they are at satisfying existing customers. It also increases ROI, boosts loyalty, and brings in new customers.
How does customer service affect customer retention?
Great customer service can improve customer retention and repeat business. Repeat customers are also more valuable, with them spending 67% more than new customers, a study finds. Customer service can also improve your acquisition of new customers through positive reviews and word-of mouth.
How can you empower your customer in a selling situation?
5 Ways to Empower Your Customers to Be Your Biggest Marketers
- Boost Offline Word-Of-Mouth.
- Build Die-Hard Brand Advocates.
- Encourage Customers to Give Testimonials.
- Dedicate a Page on Your Websites to Use Cases.
- Ask for a Much-Wanted Review.
What is consumer empowerment?
1. A mental state usually accompanied by a physical act which enables a consumer or a group of consumers to put into effect their own choices through demonstrating their needs, wants and demands in their decision-making with other individuals or organisational bodies in the marketplace.
What does empowerment mean for your business service?
Empowerment in business is a management practice of sharing information, rewards, and power with employees. This puts them at the heart of the organization by giving them power and autonomy.
How does employee empowerment influence quality performance of an organization?
Employee empowerment has a dual positive impact. From an organisation’s perspective, employee empowerment improves performance, innovation, and quality of work. From the employee perspective, employee empowerment increases self-efficacy, work motivation, and organisational identification.
What is an example of empowerment?
When employees are empowered to make decisions that help the customer, they are contributing to the strategy and business objectives of the organization. For instance, if an employee is dealing with an angry customer, they should have the tools and authority to make things right.
What is good customer retention rate?
For most industries, average eight-week retention is below 20 percent. For products in the media or finance industry, an eight-week retention rate over 25 percent is considered elite. For the SaaS and e-commerce industries, over 35 percent retention is considered elite.
What is the most important factor in customer retention?
The main findings contain that the most common factors that affect customer retention are service quality, satisfaction, trust, and commitment.
What is good customer retention?
Customer retention refers to a company’s ability to turn customers into repeat buyers and prevent them from switching to a competitor. Focus on buyer relationships with your existing customers to boost their brand loyalty.
What affects customer retention?
The main findings contain that the most common factors that affect customer retention are service quality, satisfaction, trust, and commitment.
4 customer retention strategies your business can’t miss
The importance of client acquisition is well known, but it’s customer retention programs that can assist organizations in maintaining a steady base of customers on which they can rely – a base that can assist them in getting through tough times, identifying important trends, and making improvements that can keep their business relevant as times change. Customer retention, on the other hand, may not seem as thrilling as client acquisition, but it is less expensive and may ultimately make or break your company.
Additionally, if you keep only 5 percent of your customers on a yearly basis, you may produce up to 125 percent greater revenues,” which demonstrates just how vital it is to retain consumers and maintain a customer-centric mindset.
- Continue to communicate. It is possible to put your best foot forward by utilizing business applications like as customer relationship managers, which provide your team with all of the information they want to interact with consumers and understand their demands. Seek for a customer relationship management system that smoothly organizes information like as emails, phone conversations, invoices, and notes in a database that everyone who has interaction with the client can access. It will allow your customer support professional to receive the “whole picture” when a contact happens, allowing them to properly address each and every request or inquiry that comes their way. Customers can be rewarded through the use of loyalty and discount programs. Any modern client retention campaign should incorporate some form of customer incentive, loyalty, or discount program as a part of the overall strategy. If you’re still not convinced, consider the following: The survey found that “69 percent of customers indicate that where they may earn customer loyalty/incentives program points influences their choice of store, whereas 57.4 percent of consumers join loyalty programs to save money and 37.5 percent to obtain rewards,” according to Invesp. Respond to client requests for assistance and maintain an open line of communication with them — showing yourself as a genuine person as well as a legitimate business. The ability to communicate effectively is essential in every relationship – so seek for business applications and email marketing solutions that not only enable you to interact with your clients and give help when they need it, but also allow you to tell your story in your own voice. Maintaining an authentic presentation of yourself and your organization allows you to build rapport and trust with your customers, which can go a long way toward meeting your customer retention goals. Connect with your customers, stay in touch with the marketplace, and ensure that your business and product strategies allow you to deliver what your customers require. You may engage with your consumers at their convenience by developing opportunities for them to provide feedback through social media platforms, email, surveys, and contact form submissions, as well as in-person and over the phone, among other avenues. Communication, on the other hand, must be two-way in order to be effective. Respond to both negative and good comments, follow up with consumers to ensure that they were satisfied with their experiences and/or resolves, and demonstrate to them that you are actually listening by implementing significant improvements that have been identified as a result of their input. It will enable you to demonstrate to individuals you serve that you are paying attention to their requirements and that you are attempting to develop and adapt in response to the marketplace.
As your client retention program evolves, make sure to incorporate personnel training into your overall strategy. So that your staff understands exactly how to implement the strategy, they will be empowered to make swift choices, and they will know when it is necessary to escalate difficulties to the next level of management. Not only will it enable your employees to deal with problems as they emerge, but it will also enable them to provide a better overall experience to customers.
Best Tactics to Increase Customer Retention
Remember to incorporate personnel training into your customer retention strategy as your program grows and evolves. So that your team understands exactly how to implement the strategy, they will be empowered to make swift choices, and they will know when it is necessary to escalate concerns to the next level of the organization hierarchy. Additionally, your employees will be better equipped to deal with difficulties as they emerge, resulting in a more positive customer experience.
What areas of your website provide the most opportunity for retention
A retention plan should be completely tailored to your company’s identity and its target clients. The page on which you concentrate your efforts will be determined by where you believe the most potential for long-term partnerships exists. Erin DeCesaris, the eCommerce Growth Strategist at Fuel Made, employs analytics to identify and capitalize on business possibilities. Here’s what she has to say: Check your site statistics to discover which pages visitors are most frequently visiting and how those pages perform in order to decide where the most potential for improvement are,” she advised.
Use such landing pages to collect user information for retention marketing, especially for top-of-funnel channels like as Facebook and Instagram.
Your customer data will provide you with more in-depth insights on where you should focus your efforts when interacting with customers. However, there are a few sections on your website that you should pay particular attention to, including your:
With this in mind, let’s delve into the retention marketing “must-haves” and “nice-to-haves” that you should be considering in order to properly optimize those pages and stimulate client purchase.
5 website must-haves to increase retention
By “must-haves,” we imply concepts that must be prioritized if you want to increase your retention rate in a meaningful way.
Build trust with your customers
In order to increase customer retention, it is critical for brands to establish trust with their consumers as the cornerstone of their relationship. But what does it truly mean to “establish trust” in the first place? It all boils down to satisfying (and surpassing) the expectations of customers in terms of product quality, shipment speed, website presentation, and customer support services. Clearly communicating who and what your brand is and stands for on your website is critical, as is following through on your promises.
Additionally, you may include testimonials, reviews, and user-generated content on your website and in your emails to demonstrate to buyers that your brand is well-respected and trustworthy.
The user reviews for each product are shown just beneath the product title on the Cocokind product pages.
Cocokind upsells relevant items that are complementary to what the user is presently looking at by including a “often purchased with” area beneath the product.
Use a variety of email and SMS opt-ins
Collection of email and SMS opt-ins should begin as soon as possible. If you ask clients for their contact information as soon as they come on your website—and provide them with an incentive to do so—you will have the option to continue connecting with them after their first visit to your site. It is possible to keep in touch with those consumers even if they do not convert on the initial visit, and you can begin collecting information that will allow for further customisation in the future.”Pop-ups and quizzes are two of the most successful techniques for gathering emails and phone numbers.” Continued with examples of client retention methods, here’s a pop-up from Tomlinson’s Feed that collects more than just contact information.
You can also gather zero-party data and question users about their buying habits.
It asks customers if they want a free dog treat or cat toy, and then asks if they’re a dog person, a cat person, or something else.Using this information, Tomlinson’s Feed created this personalized welcome flow to recommend only products that the customer would benefit from (there’s a version for dog owners, too).
Make your customer support readily available
Collecting email and SMS opt-ins as soon as possible is imperative. If you ask clients for their contact information as soon as they come on your website—and provide them with an incentive to do so—you will have the option to continue connecting with them after their first visit to your website. Using pop-ups and quizzes, you can keep in touch with customers even if they don’t convert on the first visit, and you can begin collecting information that will allow for greater personalization in the future.”Pop-ups and quizzes are two of the most effective tools for collecting emails and phone numbers.” With both, you can gather more than just contact information; you can also collect zero-party data and question customers about their buying preferences.To continue with examples of client retention methods, here’s the pop-up from Tomlinson’s Feed.
It asks customers if they’d like a free dog treat or cat toy, and then asks whether they’re a dog person, a cat person, or something else.Using this information, Tomlinson’s Feed created this personalized welcome flow to recommend only products that the customer would benefit from (there’s a version for dog owners, too):With customer data like this, you’ll nurture long-term relationships because you’ll understand what kind of products customers are most interested in, making
Be transparent about how your shipping and returns work
Let me share with you a fun fact: unexpected shipping expenses are the most common cause for shoppers to abandon their shopping carts. Furthermore, not being upfront about your shipping and return procedures might have a negative impact on your customer connection. Inform customers on any additional expenses that may be associated with their orders, as well as how your shipping process works, when they can anticipate products to arrive, and how they may return them if necessary. This information has to be communicated to clients before they reach the checkout page.
- Product pages
- Email flow diagrams
- The homepage
- And the FAQ page a page for shipping and returns (yes, you should develop a page just for this)
Make it obvious to your customers how they will receive their items, even if you are selling digital things. “Surprise expenses,’ such as unplanned shipping fees or delivery delays, are one of the most common reasons for customers to abandon their shopping carts during the checkout process.”–Erin DeCesaris, Ecommerce Strategist at Fuel Made
Collect and share product reviews
“Product reviews are now considered table stakes in the eCommerce industry,” to put it bluntly. To put it another way, you absolutely must have them. Non-stop, positive customer reviews are critical not just on the acquisition side (since positive evaluations may instill trust in customers to purchase your items if others had a positive customer experience), but they are also critical in driving retention. Here’s how you can utilize them to your advantage on the retention front:
- You may use them into your email campaigns to remind customers why they adore your products. Allowing customers to leave an honest review after completing a purchase might result in special discounts or more loyalty points. You may learn from your bad reviews and client comments to identify areas where you can enhance customer experiences, which will lead to more satisfied customers in the future. Respond to customer reviews to demonstrate your appreciation for them and to strengthen your relationship with them.
To illustrate, Paleovalley uses the following content block in their email after suggesting their product to offer a customer testimonial and review in order to assist push the sale.
4 nice-to-haves to drive customer retention
Because you are a growing company, you will not be able to complete all of your goals.
However, if you have the necessary resources, here are four extra techniques to increase client retention on your website:
Educate customers on how to use your products
Customer retention is dependent on your ability to assist them in learning about the benefits of your product and how to utilize it appropriately. This is especially true when you offer a sophisticated product. If clients become annoyed while attempting to utilize it, they will give up, which is something you do not want. Encourage customers to succeed by providing instructive content on your blog, posting educational videos of individuals using your items on YouTube and Instagram, and building email flows that guide them through the appropriate use of the product once they have purchased.
This assists Premama’s clients in educating themselves on pregnancy health, demonstrating that Premama is a legitimate thought leader in the sector and can be relied upon.
Offer a subscription program
Subscription packages are an excellent method to increase customer retention. Customers will continue to purchase your items as a result of the program, which is meant to ensure that. However, they are not effective in every business. Especially if you sell replenishable items such as consumables or cosmetics, subscriptions are an obvious approach to generate predictable revenue while also keeping people engaged with your brand. If you find that a subscription model works for your company, make sure your clients are aware that you provide one.
- Don’t forget to provide clients with the option to subscribe through email as well!
- This is often accomplished through cost savings, free shipment, or a combination of the two.
- Take, for example, Cocokind’s membership service, which provides clients with the chance to save 8% while also receiving free delivery when they enroll.
- Other methods to make your membership program more attractive are to provide advantages such as free merchandise, a birthday discount, early access to items, free products, or access to a secret community in addition to the standard features.
Create a loyalty or referral program
Customer retention may be increased significantly through subscription schemes. Customers’ continued use of the product is the goal of the program, which is why it was created. However, they are not effective in all industries. In the case of replenishable items, such as consumables or cosmetics, subscriptions are an obvious approach to generate predictable revenue while also keeping people engaged with your brand. Customers should be aware of the fact that you provide a subscription model if it is successful for your company.
Make sure you provide clients the opportunity to subscribe through email as well.
Saving money on freight or offering free shipment are common methods of doing this.
Check out the membership service offered by Cocokind, which allows consumers to save 8 percent on their purchases while also receiving free shipping.
There are also more methods to make your subscription program more attractive, including offering incentives such as free merchandise, a birthday discount, early access to new product releases, free items, and membership to a secret community.
Continue to engage with customers with value-add content
When it comes to increasing your recurring client base, the goal is to continually provide value to your consumers and give them a reason to stay involved with you and your business. Many businesses, however, are unaware of the tremendous value that can be gained through sharing material. Blog entries, videos, and social media postings are all examples of value-added material that may be delivered with clients as part of their post-purchase relationship with your company. Customers will be interested in knowing about your business if, for example, it has a fascinating past or an inspirational objective that they can relate to.
If your company is connected with any charitable organizations, be sure to tell your audience about it.
In addition, as previously said, you may educate clients on how to correctly utilize your items by providing them with product information.
Customers will continue to purchase your items if they recognize the value in what you’re offering.
Website retention best practices to keep in mind
There are some best practices to keep in mind when developing a customer retention strategy for your website now that you’ve gathered a slew of ideas on how to improve your retention strategy directly on your website.what Here’s our team considers before developing a web retention strategy:
- There are several best practices to keep in mind when developing a customer retention strategy for your website now that you’ve gathered a slew of ideas on how to improve your retention strategy directly on your website.what Here’s our team considers before developing a customer retention strategy for your website: 1.
And keep in mind that there is no such thing as a one-size-fits-all retention approach. Therefore, put in the effort to get to know your consumers first, and you’ll see a good return when you cultivate those connections in a way that encourages them to return again and again. Would you like to know what kind of increases in Net Revenue you may expect to see if you increased your investment in customer retention? Please try out the Customer Retention Rate Calculator right away! Biographical information about the author Tina Donati, the Senior Marketing Manager at Fuel Made, wrote this post for the company’s blog.
Our mission at Fuel Made is to create attractive, conversion-focused online experiences for our clients while also providing growth strategy consultation and full-service email and SMS marketing.
How to retain more customers
We all know it, you know it, we know you know it, and you know we know it, but we’ll say it anyway: repeat business is where the real money is made in the service industry. It doesn’t matter if you’re a B2B consultant with a handful of large clients or a multinational FMCG corporation with millions of customers- if you can’t keep them coming back for more, you won’t be there for long.
As another cliche goes, “you can’t alter what you don’t measure,” so before we get started on making the line move higher, let’s take a step back and look at what the line actually represents in this context.
What is customer retention?
If you offer a product, have you ever sold the same thing to the same customer more than twice? Congratulations, you’ve just successfully retained a client. Providing an ongoing service to a client who continues to do business with you for more than a day qualifies you to be a customer retention expert. It is possible to do this through a variety of means, including loyalty cards and VIP programs, but the goal is always to keep clients with the firm for as long as possible.
Why is customer retention so important?
Simply boosting customer retention by 5 percent has the potential to improve earnings by anywhere from 25 percent to 95%, depending on the business model. Customer retention is substantially less expensive than acquiring new clients, and your accountant will appreciate the constant and, in many cases, predictable revenue. However, it has an impact on more than simply your bottom line. Customer retention provides a variety of advantages, including the following:
- Customer advocacy: If your customers enjoy your firm, they will promote it on your behalf. Information: Customers that are actively engaged are more likely to provide comments on how you might improve. The practice of cross-selling is based on the fact that a current client is more inclined to investigate the remainder of a company that they trust.
However, it is easy for senior management to become focused on new client development and lose sight of the overall picture, which is why you need reliable, quantitative metrics. Fortunately, there is a solution.
How to calculate your customer retention rate
(You didn’t think it would be that difficult, did you?) There are a few different methods for calculating client retention rate. Here’s one of the most frequently encountered: ((E-N)/S) x 100 = ((E-N)/S) In this equation, E represents the number of customers at the end of the time, N represents the number of new customers gained throughout the period, and S represents the number of customers at the beginning of the period. Now you have to choose a time frame that makes sense for your situation.
By doing a thorough analysis of your sales data and applying a little common sense, you should be able to identify a variety of time periods that are effective.
It’s possible that this is the most often used measure, but there are alternatives.
In order to begin working on customer retention, you must first calculate the proportion of consumers that are leaving your company (known as churn). This is a good and simple computation as well: Churn rate percent is calculated as (total customers + new customers – lost customers) / lost customers. Again, you’ll have to choose a time frame that makes sense for you to measure this in—a month, two months, or a year, for example—and it makes more sense for subscription-based businesses like SaaS providers than it does for enterprises that sell physical things in storefronts, for example.
Repeat Purchase Ratio
For businesses that offer just one-time items, a repeat purchase percentage is the greatest way to get reliable information about customer retention and satisfaction. There is one catch, however: you must be able to demonstrate that a certain customer has made more than one transaction from you. Online firms find this to be trivial, but companies who sell physical things to merchants who subsequently resell them to customers may find it more difficult to do so. Okay, now it’s time to do some math.
It’s simple and straightforward.
Customer Lifetime Value
Hey, here’s another one that’s simple and effective when it comes to striking a balance between customer acquisition costs and the true value your customers provide. The cost to acquire customers (CaC) for new businesses or new products can be a “startup killer” – you invest your money in glitzy product launches, an elite field sales team, and a plethora of swag (you’ve got to have those branded USBs), but once you land a client, they only pay a fraction of what you spent to get them in the door.
If the average lifetime value of your customers is less than your acquisition cost (the simple version is your sales and marketing spend divided by the total number of customers), you have a customer retention problem on your hands.
Revenue Churn Rate
The following task is ideal if you enjoy delving into the nitty-gritty of your sales and return data. You’ll need access to a CRM or accounting system, or you’ll need to fetch the corporate accountant some coffee for this task to work. A company’s revenue churn rate reflects how much money it has lost as a result of client turnover over a specific period of time. To calculate your basic Revenue Churn Rate, multiply the number of customers you lost in a particular period by the Customer Lifetime Value (see below): In the previous month, we lost five clients, and with a CLV of $5,000, it equates to $25,000 in income lost.
Example: If your company sells subscription products or services (and thus generates monthly recurring revenue, or MRR), and you also offer upgrades or optional features, you could use the formula:((MRR at the beginning of the period – MRR at its conclusion) – MRR from upgrades) / MRR at the beginning of the period.
Net Promoter Score
Although Net Promoter Score (NPS) is not specifically about evaluating customer retention, the two are so closely connected that if you measure one, you should surely monitor the other, as NPS may provide you with vital insight into why customers aren’t sticking around long. The Net Promoter Score (NPS) is a measure that, in case you’ve been living under a rock, indicates how likely your present customers are to suggest your firm to others. If you’re experiencing client retention issues, one of the most likely causes is that consumers are dissatisfied with what you’re doing.
If you have low customer retention and a low net promoter score, it’s very evident that you’re not providing a decent product or service.
It could be that customers are using your product for a short period of time before abandoning it, in which case you will need to add new products or educate your customers to keep them.
How to increase customer retention rates
Following the measurement of your CRR, you would expect the line to begin to rise, wouldn’t you? It would be strange if you didn’t do so. If you have a business-related question, the solution is always’make a great product or service and sell it at a price people can pay’, regardless of whether the subject is B2B, B2C, SaaS, software, space tourism, or anything else. Here are some ideas, assuming you’ve mastered that portion of the course material.
Find out why people are leaving
This is the most important, thus it will be covered first: if you understand why individuals leave you, you can take steps to rectify the situation. If you have the opportunity, find out why past clients departed and, if feasible, read online evaluations. You will discover that bad customer service and an impression that you do not care about your customers are two of the most common reasons for customer dissatisfaction, both of which may be rectified with some retraining and policy adjustments.
Focus on service
This gets us to where we are now. The term “customer service” does not only refer to providing service with a smile and remembering to say “have a great day now!’ at the end of a phone conversation; it includes everything from how simple it is to place an order to service availability and technical assistance. Even more than that, it’s such a vast subject that we would be remiss if we attempted to cover it all in one article. For example, we recommend that customer-facing workers be given the authority to deliver little gestures of appreciation or apology without the need to call a management in order to issue a refund or send a long-term client some cookies on their birthday.
For example, there are occasions when you simply have to take a stand.
That’s a tricky wire to walk, and you’ll see instances of two of the world’s largest tea firms encouraging consumers to stop purchasing their products in the goal of gaining new customers and strengthening their relationships with existing ones in the examples above.
Spot the Patterns
And that gets us to where we are now standing. While customer service does not only include a kind grin and a cheery “have a pleasant day!” at the end of a phone contact, it does include everything from the ease with which an order may be placed to service uptime and technical assistance, among other factors. Even more than that, it’s such a vast subject that we would be remiss if we attempted to cover everything here. For example, we recommend that customer-facing workers be given the authority to deliver little gestures of appreciation or apology without the need to contact a management in order to issue a refund or send a long-term customer some cookies on their birthday.
Taking a stand, for example, is something that must be done from time to time.
To walk that tightrope is challenging, and the examples above show two of the world’s largest tea firms advising customers to quit purchasing their products in the hopes of gaining new customers and strengthening their relationships with existing customers.
Instead of simply tweeting the appropriate hashtags, it is important to live those values in the way your company operates and the way your workers and customers are treated as a result of their interactions with you.
Create a VIP program
People enjoy being made to feel unique, and if you can make them feel special, they will stay for a longer period of time. Customers that have been with you for a long time and are of high value should be given special treatment in order to obtain more from you. That doesn’t have to be limited to tiered discounts; it might also offer priority service, personal account managers, and even a party to commemorate your company’s anniversary.
Make Loyalty (and upselling) easy
If you make people feel special, they will stay longer. If you make people feel unique, they will stay longer. Customers that have been with you for a long time and are of great value should be given special treatment and incentives. Tiered discounts aren’t the only option; priority assistance, personal account managers, and even a party to commemorate your company’s anniversary may be included as well.
Examples of great customer retention strategies
Itscustomer service Twitter handle, which is run by the creative software behemoth, is characteristically vibrant. It is their policy to actively seek out individuals who are dissatisfied with their goods (just tweet ‘I don’t like photoshop’ if you don’t believe me), and they are particularly good at showcasing content created by people who use their products. You would choose CorelDraw instead of Adobe after your portfolio was shared with more than 87,400 individuals on Twitter.
Using itscustomer support Twitter handle, the creative software behemoth is generally bright and lively. It is their policy to actively seek out customers who are dissatisfied with their goods (just tweet ‘I don’t like photoshop’ if you don’t believe me), and they are particularly good at distributing content created by individuals who use their products. You would choose CorelDraw instead of Adobe after your portfolio was shared with more than 87,400 individuals over Twitter.
Amazon has landed on a brilliant notion with Prime: a customer loyalty program that people are willing to pay to be a part of. Consider this: if you’re already paying the tiny amount for Prime, what’s the point of shopping anywhere else? These types of models have been used for decades by membership-only shops such as Costco and Sam’s Club, and Amazon has taken this notion and made it massive, as they usually do.
How to measure customer retention success
So you’ve set up your setup, and your VIP Platinum Players Club swag bags are bursting with branded USB keys and t-shirts, and you’re ready to play (XXS and XXXL only). How can you determine whether or not your strategies are having an impact? The first and most apparent method is to check in on your metrics on a regular basis and observe if your lines are increasing or decreasing. As we’ve previously stated, it’s critical to set realistic timetables since this is a marathon, not a sprint. It will take time for your efforts to retain clients to bear fruit, and it will take time to determine how significant an impact they have.
That type of slow-and-steady approach may be incompatible with today’s culture of “go fast and smash everything,” but it is the only way to position yourself for long-term success.
For more than a decade, Gareth has worked in the marketing industry in Manchester, England (although he is not really from there because he travels a much). Learn about product marketing trends.
How Employee Empowerment Can Improve Employee Retention
Subscribe to keep up with the latest news and developments in human resources and people operations! With the epidemic in full swing, millions of people are reevaluating how work fits into their lives and whether or not their present position is well-suited to their beliefs, available time, and overall life objectives. Early on, due to market uncertainties and closed doors, many employees were let go by their respective firms. Businesses, on the other hand, are seeking for innovative strategies to retain their employees and recruit top talent in today’s market.
According to the Bureau of Labor Statistics in the United States, 4 million Americans abandoned their employment in only one month in July 2021.
And it appears that the turnover tsunami will continue for some time to come.
In light of the proliferation of memes such as “Congratulations on quitting the job that was killing your soul,” as well as a tweet by Amanda Pendolino that went viral, “2021: congratulating your friends for quitting jobs rather than getting jobs,” this ongoing situation has been dubbed “The Great Resignation.” So, how can you manage to retain and continue to recruit great personnel in this turbulent and competitive labor market?
- In many ways, your employees are the lifeblood of your company, since their performance has a direct correlation to the overall profit, development, and success of your company.
- Their abilities, expertise, and experience are all valuable assets that may help your organization gain a competitive advantage and stay one step ahead of the competition in your field.
- “Pandemics transform society at fundamental levels,” according to behavioral scientist Aaron McEwan of global research and consultancy company Gartner, who spoke on ABC RN’s radio program This Working Life.
- In other words, it has changed the psychological contract that exists between companies and employees.” In today’s competitive employment market, giving your employees the ability to make decisions is more vital than ever.
Here are a few areas where you should concentrate your efforts in order to have a significant influence across your organization:
The culture of a company serves as the heart and soul of the firm. This combination of shared values, objectives, attitudes, and practices that defines an organization is frequently cited as one of the most important factors in determining whether or not to work for a certain firm. Traditionally, firms have associated a great corporate culture with a pleasant working environment, a competitive compensation, and a wide range of perks. This is no longer the case now. Employees no longer desire to work in order to survive, and the notion of success no longer consists solely in reaching the pinnacle of the corporate hierarchy.
- In order to establish a successful workflow from both the office and the field, flexibility and adaptability have proven to be essential at this time.
- A flexible work paradigm that fosters both in-office and remote work makes it simpler for your firm to grow and prosper.
- The fact that many firms were forced to go remote early in the epidemic and were apprehensive about how this would affect productivity has shown to be unfounded.
- It is possible to keep your staff happy, engaged, and productive by allowing them to create their own working environment.
Attracting Top Talent
Yes, a large number of people continue to work in order to pay their bills. That may have been the standard even only two years ago, but nowadays, if you want to recruit top talent to your company, pay isn’t the only element that will entice your target prospects to join your organization. Today, one of the most important factors in establishing yourself as a firm that attracts customers is the advantages and perks you provide. Everyone is on the lookout for job experience that will be beneficial to their future careers and personal lives.
According to a recent DoorDash poll, 85 percent of employees believe that regular meal delivery would improve their workplace happiness.
No time in history has the adage “people don’t quit a job, they quit a boss” ring more true than it does now.
Some suggestions to help businesses better connect with their teams and empower their employees are provided below.
Create time for employees to connect with leadership
To be a member of a certain community is one of the most significant reasons people choose to work for a particular organization. Employees, on the other hand, are feeling more excluded than ever before. A recent research by the professional and personal coaching organization, for example, found that BetterUp demonstrates that firms are striving to create a sense of belonging among their employees. Because some workers are working from home, they don’t have the opportunity to engage in small conversation at the water cooler.
It is critical to have a sense of belonging in a company since it has a direct influence on employee performance and their desire to remain with the firm.
Organizing lunches with workers is one of the most effective methods for managers, senior executives, and CEOs to build relationships with them.
Dyson School of Applied Economics and Management, “Eating together has a long, primeval legacy as a form of social glue from an evolutionary anthropological standpoint.” That appears to be the case in the workplace today.” Sharing a lunch with employees is a win-win situation for both the leader and the staff.
You must, however, have a plan in place to organize and execute a lunch that everyone will like (while still adhering to their own dietary limitations).
Each person attending lunch may select a restaurant and meal of their choosing, and then add their individual dishes to the group’s purchasing cart, allowing your team to eat what they want together.
Empower your leaders to empower the members of their teams
Employees who are content are more productive. When your leadership makes your team members feel appreciated and continually acknowledges what they offer to the table, they are more likely to perform at their peak. Employee empowerment extends beyond simply rewarding them for their efforts on the job. Showing gratitude for people’s efforts, even when the results are different from what was initially planned, goes a long way toward building trust. The time you invest in showing your employees how much they are valued by the firm establishes a strong foundation for a culture of empowerment, trust, and gratitude.
Simple gestures such as sending a thank you note, providing more PTO, appreciationgift cards, or commemorating personal anniversaries are some of the most impactful ways to accomplish this.
Give your HR team the tools they need to shape your company culture
A happy workforce produces a lot of work. You can be sure that your staff will put out their best effort if their work is recognized and appreciated by their supervisors on a regular basis. Employee empowerment extends beyond simply rewarding them for their efforts. It goes a long way to express gratitude for people’s efforts, even when the results are different from what was initially planned. Employers that take the time to recognize and appreciate the contributions of their workers provide the groundwork for a culture of empowerment, trust, and gratitude inside their organizations.
Encourage and put aside a budget for leadership to offer signs of gratitude
The simple act of saying “thank you” has no monetary cost but can have a significant influence on how your staff perceives their work. As businesses battle to retain their employees, expressing appreciation is one of the most important factors in ensuring long-term employee retention. Some of the most effective methods to engage and connect with workers are to consider their safety, their prospects, and incentives that will make their lives simpler both physically and psychologically. “Companies like Truist Bank are paying $1,200 pretax incentives to employees earning less than $100,000,” says Trish McFarlane, CEO and Principal Analyst at H3 Human Resource Advisors.
- Employers like as PepsiCo are also assisting staff by offering full wages for 14 days to those who are required to quarantine their facilities.
- Another important factor in increasing employee retention is the creation of a friendly work environment that places a strong emphasis on employee well-being.
- If you have workers who work from home, a stipend or gift cards are wonderful methods to encourage them to purchase something exciting for their home office or to have access to a nutritious meal while they are busy at work.
- Allowing your workers to maintain a healthy work-life balance may greatly improve business culture and increase employee empowerment.
Being creative when it comes to providing advantages that promote mental health, mindfulness and sound eating may well be the key to success in this endeavor. In order to promote a healthy work-life balance and maintain employee wellness in the long run, consider the following suggestions:
Extend remote work stipends
Remote work isn’t going away any time soon, and neither should you. Despite the fact that many people are delighted to continue working from home, the border between business and personal life is increasingly becoming blurred in many cases. In fact, according to a recent Kentik poll, 51 percent of employees are concerned about maintaining a healthy balance between work and leisure time. Providing workers with home offices that are well-equipped to meet their specific needs will not only help them work more efficiently, but it will also provide them with an area where they can focus on accomplishing their jobs.
Boost employee wellbeing with food-based benefits
In the near future, there will be no end to remote work. Many people are content to continue working from home; yet, the border between work and personal life is frequently blurred as a result of this. An employee study conducted recently by the IT company Kentik revealed that 51 percent of respondents were concerned about establishing a healthy balance between their professional and personal lives. It is possible to guarantee that workers perform better and have a dedicated workspace by assisting them in furnishing their home offices with goods that best fit their unique requirements.
Implementing meeting-free days
The tendency for employees to become burned out and frustrated when they have too much on their plate is high. This is especially true if they are working overtime consistently and not being able to reach their objectives. Since the outbreak of the pandemic began, 44 percent of employees have reported being fatigued by video calls. Meetings frequently cause employees to waste precious time that they could be using to actively contribute to their jobs. When you designate one or two meetings-free days per week, you are assuring that employees can delve into their work without being interrupted and enter a state of flow, which is the condition of productivity at its highest level.
Free up time in your employee’s schedules
The tendency for employees to become burned out and irritated when they have too much on their plate is high. This is especially true if they are working long hours and not meeting their objectives. Four-fifths of employees have reported experiencing video call weariness since the virus first spread. The majority of the time, meetings cause employees to waste critical time that they might be putting into their jobs. When you designate one or two meetings-free days per week, you are assuring that employees can delve into their work without being interrupted and reach a state of flow, which is the state of productivity at its highest level.
The ability for your employees to completely concentrate on their job for a few days each week will have a beneficial influence on their general wellbeing, empower them, and even aid in the growth of your firm over time.
Customer Retention 101: Grow Your Business by Selling More to Current Customers
You’ve probably heard it a hundred times before. It is less expensive to encourage existing consumers to make a repeat purchase than it is to acquire new customers. Many organizations, particularly those in the crowded ecommerce sector, are finding that the cost of clicks and conversions is growing all the time, and this is especially true. When was the last time you searched for ways to re-engage clients and entice them to return to your business? When it comes to client retention, now is an excellent moment to put up a unified plan that will benefit all of your present customers after the sale.
What is customer retention?
Increasing the number of repeat customers and increasing the profitability of each existing client are two goals that businesses strive to achieve through customer retention. In order to deliver and extract additional value from your existing client base, customer retention tactics must be implemented in both directions. To guarantee that the consumers you fought so hard to recruit remain with you, have a positive customer experience, and continue to get value from your products, you must first ensure that they are satisfied.
When it comes to your retention program, how much effort and resources should you allocate?
When to focus on customer retention
The stage of your store’s lifetime has a significant impact on whether you should prioritize customer acquisition or retention efforts. A store that just opened its doors today is considerably different from one that has been in operation for several years or more. Please refer to the timeframe provided below for basic suggestions on the potential investment levels for your store. 1. When you’re just getting started, there’s one thing you should be concentrating on: attracting clients to your shop.
- Concentrate on developing ideas and methods that will assist you in expanding your consumer base.
- Getting some traction: You now have clients and are making intermittent sales, which is a good sign.
- My tip would be to begin with client retention email marketing that are geared toward persuading prior customers to do business with you again.
- Consistent growth: While you aren’t yet an online behemoth, your revenues are on the rise.
- You may want to consider implementing a referral and/or loyalty program, as well as being more serious about using marketing automation tools.
- One of the most typical challenges faced by merchants of this scale is figuring out how to keep up with the competition.
- At this point, you should be serious and methodical in your attempts to retain employees.
- Well-established: At this point, your shop has successfully navigated its way through the early hurdles.
- Now is an excellent moment to place a strong emphasis on retention.
- Each month, the imaginary light purple business retains 5 percent of those consumers, whereas the dark purple store retains 10 percent of those customers.
The 5 percent increase can result in quick growth, which is tough to match with traditional acquisition strategies, as you can see. Aside from the stage at which your business is now at, you’ll want to customize your approach based on the products you offer.
How retention fits your business
What you sell has a significant influence on which marketing method you should choose. A retailer specializing in high-end leather furniture will have a distinct personality from a store specializing in tea and coffee, for example. When consumers purchase high-value things on a regular basis, a store’s customer lifetime value will be the highest possible (CLV). These are the sorts of businesses that stand to benefit the most from a well-executed retention plan. In general, as you travel more to the right along this matrix, you should begin to place an increasing emphasis on retention.
It all comes down to striking a balance that works best for your organization.
The customer retention metrics that matter
It is essential to understand the underlying data if you want to improve your client retention rate. Who are these metrics, and what do they mean? What criteria do you use to evaluate them? More importantly, what can you do to make them better? Answering these questions will provide you with the knowledge and resources you need to develop a customer retention plan that will have a major and long-term influence on the profitability of your shop. This will be accomplished by taking a look at three of the most essential customer retention indicators and examining why they are important.
- The percentage of repeat customers
- The frequency of purchases
- And the average order value (AOV).
1. Repeat customer rate
Customer retention is based on the percentage of customers that return again and again. Customer retention is defined as the percentage of consumers that are willing to make a second purchase from you. When it comes to analyzing the effectiveness of your retention strategy, measuring your repeat purchase rate is a fantastic way to start. The higher this metric is, the more likely it is that customers will return to your establishment.
How to calculate repeat customer rate
You might easily become disoriented when it comes to calculating retention metrics because there are so many variables to take into consideration. Fortunately, measuring your repeat customer rate is extremely simple and only necessitates the collection of two pieces of information:
A. Number of customers with more than one purchase
Specifically, it refers to the amount of clients who have made more than one purchase within a given period of time. I recommend taking a look at the full year to get a sense of the larger picture.
B. Number of unique customers
This is the total number of different consumers that made purchases from your shop within a specific period of time (usually a week). It should be noted that this is not the same as the number of orders. Fortunately, this is computed for you by Shopify in your reports and analytics. You may do this manually if you like. All you have to do is divide the number of consumers who have made more than one purchase by the total number of customers. You can see how to write out this equation by writing it out like this: Customers who have purchased more than once / Customers who have purchased only once
2. Purchase frequency
Purchase frequency tells you how frequently clients return to your shop to make a purchase from you.
In light of the fact that repeat customers account for a large amount of a store’s annual sales — depending on the product category — this is very crucial to remember.
How to calculate purchase frequency
Your consumers’ return to your shop indicates how frequently they are making purchases from you. In light of the fact that repeat customers account for a large amount of a store’s annual sales — depending on the product category — this is very crucial to consider.
3. Average Order Value
Once you’ve determined your repeat buy rate and purchase frequency, it’s time to figure out how to optimize the value of each of those transactions. This measure is referred to as average order value, and it refers to the amount of money that a consumer spends in your shop on a per-transaction basis.
How to calculate Average Order Value
Your average order value should be computed using the same time period that you used to calculate your repeat buy rate, just as you did for your purchase frequency. To figure out your store’s income, all you have to do is divide your annual revenue by the number of orders it completed. This amount is calculated for you by Shopify reports as well. You can see how to write out this equation by writing it out like this: Total Revenue Received / Number of Orders Placed
Customer value: The big picture of retention
Increasing customer value is the ultimate aim of retention marketing, regardless of whether you intend to enhance these indicators one at a time or all at once. Customer value is the final piece of the jigsaw since it allows you to determine how much each individual customer is genuinely worth to you and your company. In order to calculate it, you must already have a grasp on your buy frequency and average order amount, among other things. By combining these two numbers together, you will be able to see the true results of your effort and appreciate the significance of retention marketing strategies.
Now is the greatest time to develop a client retention plan and examine how boosting each of these indicators might benefit your company’s overall growth.
Strategies to boost customer retention
The need of having a plan to maintain our present consumers has been discussed, as has the importance of adopting strategies to gain new clients. We’ve also considered what metrics we should use to ensure that we stay on pace. Now, let’s go through some concrete suggestions that you can put into action to increase client retention.
- The need of building a plan to maintain our present consumers has been discussed, as has the importance of adopting strategies to attract new customers. Furthermore, we’ve looked at what metrics we should be tracking in order to remain on target. The following are some concrete suggestions that you may put into action to increase client loyalty.
1. Use customer accounts
Customer accounts may be a double-edged sword in terms of security. Accounts, on the one hand, can make repurchasing easier by providing consumers with fast access to prior orders as well as pre-filled shipping information, on the other hand. Customer accounts, on the other hand, are frequently regarded as a prohibitively large financial commitment for new clients. As a result, when given the choice, many consumers choose to check out as a guest rather than using their credit card. So, how can you efficiently deploy and encourage customer accounts while also ensuring that first-time customers do not experience any conversion barriers?
Once a client has completed a purchase on your Shopify site and has the option to create a customer account, you can send them a direct invitation to encourage them to do so after they’ve finished the transaction.
2. Improve your customer support
Assistance systems assist you in communicating with your customers in an effective manner and providing them with the appropriate degree of support. A support system may be beneficial both before and after the sale since it allows you, or a customer service representative, to connect with the consumer in a clear and understandable manner. If you have a live chat or help desk tool accessible, you can transform a customer query into a sale, or a customer complaint into a resolution, regardless of whether the client comes in on-site, by email, or through social media.
- And that’s not even taking into consideration the importance of client feedback, which can be used to better your products as well as your entire customer experience.
- Your clients will thank you for your efforts if you can assist them avoid difficulties and get the most of your items.
- Depending on your niche, product mix, and margins, sending a small gift to your best customers can be a great way to remind them to return while also adding an element of surprise and delight, which can increase customer satisfaction.
- Delight has its place in the world.
- Consider the fact that in a world where everything is instantaneous and done through the internet, individuals sometimes just need a change of scenery.
- When you handwrite something, it demonstrates to your consumer that you have taken the time to address them individually.
- These factors go a long way toward earning a customer’s loyalty, which can result in a lifelong customer.
3. Start a customer loyalty program
In order to earn valuable rewards, customers are encouraged to make more purchases through loyalty programs, which are also known as customer retention programs. Loyalty programs are an effective way to increase purchase frequency because they motivate customers to make more purchases in order to earn valuable rewards. When this happens, it becomes a lucrative trade for both you and your customers: they receive greater value with each purchase, and you gain from their continued patronage. Giving new clients welcome points when they sign up for an account might motivate them to continue investing in the program.
Customer loyalty programs may be as easy as awarding consumers after their second purchase or after a certain amount of money has been spent.
Additionally, you may use automated loyalty applications to reward your clients for a range of acts they perform while in your business, which can save you money.
4. Send engaging emails to customers
In the same way that purchase frequency is the foundation of customer retention, email marketing is the foundation of client engagement and the foundation of your customer retention toolset. Your clients’ email addresses provide you with the option to continue creating a relationship with them both before and after they make a purchase. Ensure that every message you send adds value to your customer’s experience by checking the following boxes: You face the danger of losing them if this does not happen.
- It is undeniable that email is a channel that generates conversions.
- Send a thank-you email to customers a week after their first transaction to express your appreciation for their business.
- It is possible to increase the effect of this initial email by promoting goods that are complementary to their original purchase.
- These endorsements will raise the perceived worth of each recommended product as well as the likelihood that a buyer will purchase it.
- Beard King performs an excellent job doing this, sending us tailored emails every two to three weeks, in which they promote new goods or offers.
- For businesses with items that are perishable, consumable, or otherwise require regular replenishment, understanding the product’s shelf life and sending timely emails can be the most effective method of reactivating inactive clients and bringing them back into the fold.
- Luxy Hair, for example, states in their FAQ section that their hair extensions will last on average three to six months, but can last up to a year depending on how often they are worn.
- These emails would assist in educating a first-time purchase, keeping Luxy in the forefront of the client’s mind, and encouraging repeat business, all while providing a positive customer experience.
- Getting customers to return depends on your ability to demonstrate to them why making an extra purchase is a worthwhile investment of their time and money.
Ecommerce Email Marketing 101 is a course offered by the Shopify Academy. Drew Sanocki, an ecommerce specialist, explains his strategy for building automated email marketing campaigns that create connections and generate revenue in this article. Enrollment is completely free.
5. Offer a discount or credit to return
In general, I would advise you to be cautious when it comes to discounting. Discounting your items forces you into a never-ending race to the bottom, where clients become accustomed to seeing prices drop on a regular basis, ultimately resulting in a decrease in income for your business. The danger of discounting is increased even further when margins are tight. When discounts are offered to first-time buyers, on the other hand, I truly like it! To encourage customers to return to your site after their initial purchase, send them a discount code for their next purchase with their transaction.
You may make that nudge more stronger by offering them a discount that is greater than the customary 10 percent.
You may also wish to experiment with giving customers credits to spend at your business (for example, $10 towards any purchase) rather than a percentage discount (i.e.
Keep customers to grow your business
Your present client base is the most valuable asset your business possesses. Customers are already familiar with your brand, they are familiar with your products, and they are pleased with your service. Concentrating your time and attention on enhancing the experience for this group, rather than always attempting to attract new consumers, may be a strong approach to boost sales for your shop and increase profits. Please accept my thanks for the contributions made by Kirsten Burkard to this blog article!