Retaining Your Most Valuable Customers – Trends to Look For in 2020

If brands want to gain customer loyalty, then they must have a laser focus on retaining their most valuable customers.  So, what is customer retention? It’s your ability to keep your customers engaged by offering them great products and great service with high perceived value across every touchpoint in the customer journey.  Loyal customers mean less churn, more transactions, higher gross margins and significant increases in revenue growth.  Consider these facts: 

  • Existing customers contribute to 65% of a company’s business
  • It costs 5 times more to acquire new customers than to retain old ones
  • If there is a 10% increase in customer retention level, it increases the value of the company by 30%

Customer expectations have changed dramatically over the years and it’s a staple to nurture your existing customers and give them myriad reasons to stay. Customer experience bells and whistles will only get you so far, customers want to be assured that brands have their backs. In 2020, in order to improve customer retention rate, it’s imperative to focus your strategies keeping customers at the fulcrum point and recognize your most loyal customers, identify purchasing behavior preferences and analyze relevant data. Retention is poised to be the top priority for brands to drive growth and customer engagement. There’s been a sea of change in the way brands communicate with their customers and everything is oriented toward agility and flexibility. The playing field has evolved and brands must adapt.

Here are some very important trends in 2020 that are being used by brands, manufacturers and retailers to retain loyal and very profitable customers: 

  • A Loyalty Program is Essential  – Who doesn’t like access to rewards, recognition and exclusive experiences? The importance of a well thought out and strategic loyalty program cannot be overstated. In order for your customers to keep purchasing from you and being loyal to you, they want to be recognized and rewarded with meaningful incentives to keep them engaged. Incentives make them feel valued and appreciated. Research states that almost 79% of customers prefer to continue shopping from a brand that has a loyalty program. You can offer VIP customer service, product rewards/gifts, discounted bundles/sales, exclusive access to new products and much more. In restaurants, there’s an increasingly popular ‘skip the queue’ perk that can be accessed through mobile apps. Incorporating social and/or community responsibility into loyalty programs is also on the rise more than ever. If a customer feels their purchases are making a difference, they will choose you over rival brands. Higher-tier loyalty programs and paid memberships are one of the most sought after loyalty program strategies. In 2020, it’s important for loyalty programs to be digital, intuitive, simple, aspirational and convenient. 
  • Omnichannel experience – Customers these days are screen-shifters by default. And it’s becoming crucial for brands to provide them with a seamless shopping experience across all relevant sales channels consistently. By 2020, research says that almost 85% customers will prefer to maintain their relationships with brands online. An omnichannel customer experience helps increase repeat purchases by up to 80%. Nike provides a consistent experience for its customers that is holistic and immersive. With the Nike Plus app, customers get automatically updated about the store layout. This makes shopping easier and convenient. Similarly, My Disney experience store is available across desktop as well mobile devices. This provides a seamless experience between their online vacation planning, phone support and in-person vacation concierge services. 
  • Real-time customer support – To address customer concerns immediately or for any immediate support, chatbots are increasingly gaining popularity. They provide instant assistance and communicate with customers until a representative takes over. Even better if the chatbots are personalized. It reduces wait-time and increases customer satisfaction. Sephora Reservation Assistant enables customers to make reservations with beauty specialists through a chatbot. Because it’s equipped with smart learning capabilities, the chatbot can easily comprehend customer’s language and make the interaction easier. Similarly, Dominos launched Dom, a pizza ordering bot that allowed customers to order directly through facebook messenger. Dom lets first-off and repeat customers to order without having to create an account or profile. 
  • Hyper-personalized experiences – One-size-fits-all is behind the times and no longer relevant in 2020. 2020 is the year of customers and they love it when products and services are tailor made to their preferences. According to a report by Accenture, almost 75% of customers are more likely to purchase from a brand that knows their name, who they are and recommends them to buy products based on their buying history. From Amazon analyzing your recent purchases, to Netflix recommending and gently encouraging you to watch shows similar to the one you’ve just streamed or watched, we are in an era of hyper-personalized experiences.

Your goal should be to create customer relationships that deliver greater lifetime value. When current customers buy more per transaction and with greater frequency, then you have a loyal customer who will take your business to a much higher level.

 
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