When you consider business growth, you may think that acquiring new customers is the key to success. Although obtaining new customers is great, setting out to acquire them in order to grow your business isn’t always as cost-effective and beneficial as you may think.

That’s because the process of identifying, qualifying, and nurturing leads to then (hopefully) convert them into paying customers requires significant resources. So, rather than simply focusing on the acquisition of new customers to hit your growth goals, invest your time in retaining your high-value – existing customers.

While there’s nothing wrong with chasing new customers, having a healthy customer retention rate can provide some big benefits—and tracking that number could highlight issues that you haven’t noticed and make it easier to predict realistic future revenue potential. 

Whether you have a website or you run a business and you are looking for different strategies to help you increase your visitor or customer retention rate, this article is for you. Let’s get into it.

• What is Visitor Retention?
• How do you Increase Retention Rate?
• How Can I Boost Visitor Retention on my Website?
• What is a Good Retention Rate for a Website?
• How do I Attract New Visitors to my Website?
• What’s a Good Customer Retention Rate?
• What are the Top 3 Keys to Customer Retention?
• What Does a High Customer Retention Rate Mean?
• What are Some Examples of Retention Rate?
• How do you Train Customer Retention?
• What Affects Customer Retention?

What is Visitor Retention?

Visitor retention – a common issue facing almost all firms today. What exactly is visitor retention and why is it important for your business?

The term visitor retention refers to the statistical count of the number of visitors that visit and return to your website. It also reflects the time spent by the visitors on your website. Essentially, it provides an indication of visitor loyalty. 

Read Also: What is the Goal of Conversion Rate Optimization?

A high Google rank will ensure steady flow of visitors to your website. However, it does not guarantee that these visitors will stay for long on your website or revisit. It is the number of visitors that actually get converted into customers that matters most.

The frequency of visits and the duration of the visit are two crucial parameters measuring visitor retention rate. So, the longer the visitor spends browsing your website, the greater the chance of getting converted into customers.  Visitor retention, therefore, assumes vital importance to business success.

Similarly, visitors who come back to your site are important sales leads. Primarily because the probability of these visitors converting to actual customers is quite high. Hence, the retention goals of firms focus on improving the overall visitor experience. The idea is to make the visitors stay longer and ensure they return back to your website again.

How do you Increase Retention Rate?

Retention is a complex affair considering user behavior online is unpredictable. The entire customer journey is exposed to multiple forces that influence the decision making process for the customers. The conventional approach to sales and purchase does not apply anymore. Remember, there is a marked shift in the way you can retain the interest of your prospective customers in the long run.

Below are a few practices that will simplify your retention goals.

Visual appeal is important

Yes, visual appeal of the website plays an important role in visitor retention. Visual clutter can confuse people and prompt them to leave the website sooner. Consequently, jarring colors used on your websites can drive visitors away. Soothing website design makes it easier for users to browse and find the information they seek. 

Content drives traffic

Visitors to your website seek information that is both relevant and accurate. Content serves to engage your visitors while at the same time it also lends credibility to your product or service. Make sure your website offers relevant, precise, and accurate content to your visitors. Use infographics, articles, blogs, videos, and animations to draw and engage your users. You can also use the links to redirect visitors to specific sections of the website.

A good product beats everything

At the end of the day, it’s the product quality and its attributes that matter to the customers. Hence, product development initiatives take precedence over marketing and sales activities. If your customers are convinced they have a good product in hand, nothing can beat it. Therefore, make sure you showcase your product attributes in ways that instantly connect to your user requirements. 

Establish an emotional connect with your users

Emotions and empathy-based marketing campaigns help in building an instant connect with your users. Why? Because visitors will visualize their core requirement translated in explicit terms on your website. For instance, a visitor searching for affordable kitchen appliances will stop to browse the website offering big discounts on kitchen appliances.  

Differentiate your brand from competitors

People are not content with just getting what they need from the nearest store. They have ample choices and alternatives available to select from today. Hence, customers believe in researching the products well before taking the plunge. So, make sure your content highlights the unique focus of your brand and how it can provide the customers with added business value. 

Deploy latest technology tools to engage visitors

Chatbots provide effective means of engaging visitors. At the same time, they also collect vital data about the visitors and their precise requirements. Similarly, mobile apps add to user convenience as they can be used anytime anyplace. So, make sure you deploy the latest technology tools to engage your visitors.

Call-to-Action buttons initiate visitor response

Make sure you add several Call-to-Action buttons on your website. Buttons like Sign Up, Share, or Post Comment prompt users to engage proactively with your brand. What’s more, it also provides reasons for them to return back to your website again. 

How Can I Boost Visitor Retention on my Website?

Visitor retention is an important metric, seeing as how a lot of visitors don’t actually become customers right away but have to undergo several stages prior to this. According to the rule of seven, one has to visit a certain brand at least seven times before they decide to do business with it.

In other words, you shouldn’t get discouraged by those who visit your e-store and leave without buying or come to your website and leave without interacting with you. Speaking of which, there are many different ways to boost visitor retention on your website, and here are five of them.

1. Average order value

The first thing you need to understand is the fact that the higher the average order value gets, the more research your audience will have to invest in order to make the leap. This is one of the simplest calculations to make, due to the fact that all you have to do is take your total revenue and divide it by the number of placed orders.

All of this, however, is just means to an end and what you’re truly aiming for is the customer value. The total customer value is calculated by multiplying a purchase frequency by an average order value. Keep in mind, nonetheless that, depending on the industry, boosting one or the other may seem like a better idea.

2. Customer assistance

In this day and age, the majority of internet users prefer to do some independent research of their own, which doesn’t mean that they don’t put a value on some proactive help on your side.

First of all, your product descriptions are a perfect example of just how non-invasive customer assistance can be. Second, by consistently providing a good service, you’ll be seen as practical and assertive, which will persuade more and more of your audience to stick around. Lastly, by ensuring that the interactions with your audience are fast (via chatbots or automated instant email responses) you’ll be strongly favored by them.

3. Using the right digital marketing technique

The next thing you need to understand is the fact that the way in which your customers reach your page matters a lot. This is why you need to ensure you reach every demographic in the most suitable way, as well as that you make your brand omnipresent in the digital environment.

Of course, you need to avoid black-hat techniques at all costs. Be transparent, as it’s better for your audience not to click on the link than to enter your domain and leave immediately after. This will increase your bounce rate, which is exactly opposite to what we’re trying to achieve at the moment. To make the long story short, using the right type of marketing at the right time is just as important as the content itself.

4. Visitor follow-up

By monitoring the activity of a person on your website, you can easily notice what they’re interested in. So, if they leave without making a purchase, you could target them and make an offer similar to the one they have previously considered. For instance, giving them 25 percent off on an item that they were previously looking at on your page might just make them come back for a purchase.

Also, offering them products from a similar category could entice them to come back and give your e-store a second chance. This also helps to customize and personalize a buyer’s experience to a certain degree, which then again helps establish a special bond between them and your brand.

5. A recommendation engine

The last thing you need to understand is the fact that in the digital world no one is exclusive to one blog, one vlog, one e-store, and one online phenomenon. It’s not like the traditional business world competition, where if a person buys from your competitors, they won’t buy from you.

On the contrary, a person interested in your industry might be on the lookout for more of similar content, items, and offers. This is why finding a way to get recommended to someone may increase your chances of getting a loyal visitor. After all, the visitors you reach in this way are mostly qualified leads.

What is a Good Retention Rate for a Website?

There’s no one-size-fits-all answer. Every product is unique and its retention rate is best compared to similar companies, industries, and go-to-market strategies. Yet product teams are often under immense pressure to decide on the proper retention rate for their business because a low rate can be a business killer.

A retention rate is the percentage of customers who are still with the company after a specified time period. It asks, in essence, “Did a user perform any action, leave, and then come back and perform another action?” If yes, the user has been retained. If not, they’ve churned. This requires product teams to define three things:

1. What is an action?

By default, most companies define “action” very loosely as any event the user takes within their platform, including simply opening it. To get a more refined sense of whether they’re actually measuring users’ likelihood to return, some product teams may tighten up that description to include only valuable events, such as purchases, sign-ups, profile completions, shares, or others that make sense for their business.

2. What is the period over which retention will be measured?

Next, product teams must determine the period over which they’ll measure retention. For many consumer apps, it’s common to track several, such as one day, one week, and two week retention. Product teams should base the period length on where they see drop-offs in returning users. For example, according to research by Mixpanel, most apps and software have a 6-20% eight-week retention rate depending on their industry.

Product teams with this range should work back from this point. It is typically where the percentage of users drops below the point where the revenue they generate covers the acquisition cost of all those users acquired at the beginning of the period.

3. How many actions within that time period constitutes retention?

Finally, product teams must choose whether their threshold is one action, three actions, or some combination of valuable actions such as making a payment or converting to a premium user. With these pieces, they can calculate retention. Here is a sample equation for retention rate:

That is, if there were 100 customers at the start of the period, and only 27 have taken an action in the past 14 days, then the retention rate would equal 27 percent. Product teams that use a product analytics platform will find that the software can calculate their retention rate for them as well as break it down into an easy to understand dashboard.

How do I Attract New Visitors to my Website?

1. Search engine optimization (SEO)

SEO is how you can increase the visibility of your website in search engines like Google, Yahoo! and Bing. In turn, SEO is a big deal when it comes to boosting website traffic. 

It’s well known that whoever sits in position one of Google’s search pages ends up monopolizing the term. On average, position one enjoys between 26-32% of all clicks, meaning roughly one in four searchers head straight for the top link. 

Even so, ranking in any other position on page one means any overspill will fall to you. But miss that all-important search page and your content will likely get lost in the endless sea of other, similar search results. 

SEO is a broad, ever-evolving practice, complex enough to afford entire teams dedicated to its art. Yet, if you don’t have the time, knowledge or resources to practice SEO at this level. Don’t fear. 

Here are some of the most basic and simple ‘quick fixes’ anyone can make to their site: 

• Fill out the meta tags on all your web pages to tell Google what each piece of content is about
• Conduct keyword research to make sure all content creation is in line with SEO
• Set your sights on Domain Authority (DA) as a key performance metric, measuring the strength of your website in its digital neighbourhood 
• Link out to other authoritative sources to build a network of links and association with industry experts

2. Paid advertising

Paid advertising helps you attract visitors to your site by creating paid clickable ads that direct people straight to you. 

If you use PPC (pay-per-click) with a search engine like Google, you can use Google Adwords to choose keyword phrases relevant to your site and services. When someone types that specific keyword into Google, your ad will appear and when a visitor clicks on your ad, they’ll be directed to your website.

PPC is a helpful tool for getting started with your online marketing. 

It takes time for your site pages to appear and rise in search engine rankings so with PPC, you can steam ahead and help people find you. This means, in an ideal world, you’ll practice both paid advertising and search optimization side by side to secure both short and long term success. 

3. Social media

You either love it or you hate it—but either way, you need it. Social media helps get new visitors to your website and creates a conversation with potential customers via the platforms they frequent the most.

The most popular social media platforms are always changing. For example, in the last year, we’ve seen image sharing platform Snapchat make way for video sharing platform TikTok. 

However, some social media mainstays are Facebook, LinkedIn and Instagram if you just want to get to grips with the basics. Ultimately, the accounts you invest in will depend on your buyer personas. 

For example, interior design companies might set their sights on Pinterest due to its inspirational aspect. Personal brands, on the other hand, might find a friend in Twitter for its ability to effectively share thoughts, ideas and experiences. 

Whichever accounts you choose, make sure you use them regularly to share new blog posts and promote your business as consistency is key when it comes to social media success. 

4. Guest blogging

By guest blogging, you can help lead traffic back to your website via other, similar online outlets. To do this, find relevant blogs that write about similar topics and contact the website owner to ask if you can write a blog post on their behalf. 

If they accept, you can get a blog written and posted on someone else’s website. If their readers like your work, they may be intrigued enough to visit your website as a result.

There are many benefits to connecting with other bloggers in your niche—both from a visitor and search perspective. By being featured on various websites around the web, users are more likely to stumble across your website. 

From a search perspective, providing a backlink to your website on relevant anchor text can help you rank for a keyword and become more associated with a given phrase. A win-win for you. 

5. Adopt an inbound approach 

If your website is filled with valuable information, visitors are more likely to take action, return to your website in the future and recommend your company and its content to others. This is the essence of HubSpot’s inbound marketing theory. 

Inbound marketing is an approach you can take to every website-related activity from designing helpful website navigation to creating informative, entertaining and engaging content. 

What’s a Good Customer Retention Rate?

In an ideal world, a company would have no attrition. While that’s simply impossible, your retention rate should be as high as possible. Low retention is a red flag for any business, as it signals poor customer satisfaction. A good rate is as close to 100 percent as you can make it.

Since the ideal retention rate is 100 percent, there’s always work to do to achieve a churn rate of zero. Here are some ways that you can get the retention rate you are looking for.

1. Do a churn analysis. 

• In this process, you simply ask old customers why they left. You can send them a quick survey with potential reasons.
• Baremetrics offers a cancellations insights tool that automatically calculates survey results on your behalf, so you can immediately begin delving into the data.

2. Track retention by cohort.

• To gain more insight, narrow down your attrition results according to a particular cohort. A cohort is just a way of categorizing a group of customers by a common characteristic. 
• It might be the time they signed up, the type of onboarding they received, the product they bought, the e-commerce marketing strategy, or the lifetime value of these lost clients compared to retained customers.

3. Ask for feedback.

• Often, getting customers to return is as simple as asking how you can improve your product or service offerings. 
• This helps with your existing customer relationships as well. If there are things you can do better, long-term customers will also benefit.

4. Create good content.

• Regular download options, updates, and product information can help current clients get the most value out of their SaaS subscription.
• Ultimately, creating great content will also help build a community.

5. Start a referral program.

• Bringing on new customers always helps, and your current customers are your best advocates in helping you attract new businesses. 
• If you receive a new customer via referral, they may be more likely to stay with you.

What are the Top 3 Keys to Customer Retention?

The fact is that existing customers have greater lifetime value for your company: A 5% increase in customer retention can increase business profits anywhere between 25% and 125%, according to Gartner Group.

Improve retention, and other facets of the business quickly begin to improve as well.

So how do you unlock such value for your business? Here are three keys to customer retention that can help you increase revenue, fill up the sales pipeline, and improve performance.

1. Set Realistic Expectations

Setting realistic expectations is so important if you’re trying to improve your customer retention rate – it can have a huge impact on your business’ ability to keep customers.

Think about things like shipping times, for example. Most online stores can’t compete with Amazon when it comes to shipping times. But, what you can do instead is work hard to keep your customers informed.

Suppose you have a customer who orders something and then has to wait a few weeks for it to show up. This can go one of two ways:

1. They have no idea how long shipping will take, and they become increasingly more annoyed every day that their package doesn’t arrive.
2. They knew from the beginning that it would take a little while, so the two-week wait is in line with their expectations, so it’s really no problem at all.

If the goal is to retain customers, we want to make sure that we’re creating this second scenario.

And there are lots of ways to do it with simple customer retention strategies.

You can have transparent shipping information on your website. You can send emails to customers telling them that their order was received; that their order was processed; and that their item has shipped.

Make sure your product descriptions are accurate. Make sure there aren’t surprise fees that appear at checkout. Setting clear expectations is a basic, but huge, step forward, and will go a long way when you’re trying to improve your customer retention rates.

2. Create a Loyalty Program

A customer loyalty program should be an integral part of your customer retention system. These programs reward your customers by giving them incentives to come back and shop with you.

Once your customers opt into your loyalty program, make them feel special by hooking them up with offers: Give them a sneak peek at new products, and offer exclusive deals. This royal treatment will help your customers to feel valued, and is the crux of this customer retention strategy.

One of the best customer retention examples based on this tactic is Sephora’s program, called Beauty Insider. This program gives access to discounts and gifts without actually having to spend any money. However, the more money you spend with them, the better the perks.

You can even give someone loyalty program-esque benefits before they have opted in. For example, you can offer each buyer a discount code inside of their order confirmation email.

Don’t make them sign up for anything – just get them the discount straightaway.

If you offer your customers value without any cloaked agendas after they’ve made a purchase, it’ll go a long way to improve customer loyalty and retention.

Shopify lets you tailor your order confirmation emails and create discount codes to bolster customer retention.

3. Pay Attention to Questions

You know how you sometimes need an extra set of eyes to edit because it’s impossible to spot your own typos?

The same thing can happen with your store: You designed the customer journey, you built the product pages, you set the prices. In short, you understand everything about your store because you’re the one who invented it.

Which is exactly why we can’t always see what we did wrong. At least not as well as our customers can. Paying attention to questions about your store is a great way to keep your customers, and a simple customer retention technique.

For example, if someone asks a question that you thought was obvious, that’s your clue that maybe it isn’t actually so obvious. Or if they ask a question that you already explained, then maybe you didn’t explain it clearly enough or loudly enough.

Make customers feel comfortable enough to ask questions. The more comfortable they feel, the higher your customer retention will be. Plus, it’s like they say – feedback is a gift.

So listen to those questions and remember that if one person is asking it, others might be as well. And listening is a great way to improve customer retention – if you know what the problems are, you’ll have a much better chance to fix them.

What Does a High Customer Retention Rate Mean?

A retention rate is used to project profits and growth. If the rate of retention exceeds the rate of acquisition, your product gains users (and revenue) over time. Alternatively, a retention rate that’s lower than the rate of customer acquisition equates to a net loss of customers.

Retention isn’t important just from a pure revenue standpoint. Businesses often take the rate of retention into account when determining how satisfied customers are with a product. Companies use retention rate to understand four things:

• How loyal their customers are
• How good their customer experience is
• What value their users get out of their product
• Whether they have a sustainable base to maintain their business

Alternatively, some companies track the exact opposite of retention by calculating their attrition rate. If a company has a 30-day retention rate of 90%, it has an attrition rate of 10%. For obvious reasons, companies should aim for high retention rates and low attrition rates.

There are two aspects of your product that you need to nail down in order to define retention for your company.

1. Your product’s critical event. This is the action a user takes that determines whether or not they have been retained. This event should be something that indicates value for both your customer and your business. It should be tied to an activity that generates revenue for you and indicates that a customer is getting what they need out of your product as well. For example, Airbnb’s critical event might be to “make a reservation.” Netflix’s would be to sign up or renew a subscription. Candy Crush: play a game level.
2. Your product’s usage interval. This is how often you expect a customer or user to perform the critical event action. Choose a time period that makes the most sense for your product. Airbnb customers should be considered retained after they make their second reservation within 18 months after their first reservation. Netflix users are retained when they renew their subscription each month. Candy Crush players are retained each day they play a game.

What are Some Examples of Retention Rate?

You can’t expect improvements to your retention rate simply by measuring it. Your rate should be used as a benchmark for building a focused customer retention strategy to decrease customer attrition. Luckily, the real world is full of companies doing retention right, including:

Calm

Daily meditation app Calm was looking for ways to improve their retention. They used Amplitude to examine the retention rate of different cohorts to see if certain behaviors correlated with higher retention. They discovered a small portion of users set meditation reminders, a feature that was buried in the settings, and that group had very good retention.

Calm ran an experiment on a small portion of new users to see if prompting them to set daily meditation reminders right after onboarding led to increased retention. The result was a 3x jump in N-day retention. Calm then rolled out the updated reminder feature across their entire user base.

Kwit

Kwit is a health and fitness app with a unique interest in customer retention. Their goal is to help people quit smoking and stay that way. Analysis by the Kwit team revealed that customers who quit smoking while using their app for a year had a 15% chance of picking up the habit again. However, they noticed that those who stuck to the program for two years only had a 3% chance of relapsing.

The team at Kwit made two-year retention their ultimate goal. They looked to personalization to increase their retention rate, asking users to fill out details about themselves during the onboarding process. Kwit then used this data to tailor the user experience to better suit each customer’s preferences, driving product adoption and retention by focusing on UX improvements.

Fishbrain

Fishbrain is a leading app for sport fishing, which enables users to record data and take photos about catches, and share them publicly via social media or privately via the app.

Fishbrain got in touch with Phiture and jointly developed a strategy to boost customer retention rates, while using Amplitude and Braze to undertake a comprehensive analysis of their current retention.

While Amplitude was used for diagnosing the areas of improvement, Braze helped them act on the insights derived from the Amplitude platform. Using Braze & Amplitude in combination became a powerful tool in improving customer retention rates. Over the course of 5 months, 40-50 experiments were conducted to enhance retention rates.

The results were phenomenal, since Fishbrain saw an increase in weekly retention, peaking at Week 6 with an uplift of 50.6%.

How do you Train Customer Retention?

Customer retention is a metric that businesses use to measure customer loyalty over time and gauge overall success. To boost customer retention, companies will implement various tactics to reduce the number of customers lost in a period and better their experiences to ensure that they remain loyal to the business.

Below we have provided some useful tips on how you can train your customer retention strategies.

1. Create a strong onboarding experience.

When your customer makes their first purchase, your business has the opportunity to leave a memorable first impression — so make sure your onboarding process is a well-oiled machine.

Customers will likely recall any customer service hiccups in their initial onboarding, like mishandling information or not having a designated point of contact to hold their hand through the beginning. While your business can quickly rectify those points of conflict, it may still leave a bitter taste in the customer’s mouth.

A good onboarding process also goes beyond customer service excellence, but should also include the effectiveness of the onboarding program itself. Your business should have workflows with well-timed email triggers, follow-up messaging, self-service knowledge base access, and celebratory messaging to excite and impress new clients.

2. Provide a personalized customer experience.

No two customers have the same exact needs and may be looking for tailored solutions from your business. You want to avoid providing one-size-fits-all solutions for customers needing products and services that cater to differing scales, time limitations, or other preferences.

In fact, according to Evergage, 99% of marketers say personalization helps advance customer relationships, with 78% claiming it has a “strong” or “extremely strong” impact.

Keep your offering relevant and personalized to each individual customer, so the solution given is the most useful for the problems they are facing. They’ll feel more inclined to continue business with you because of the attentiveness your business provides.

3. Build trust with your customers.

Two things are true when it comes to building trust between your company and your customers:

• Don’t assume they trust you because they buy from you.
• Trust takes time to build.

When deciding to make a purchase, 81% of customers say that trust is an important factor in their decision. Building trust isn’t a one-size-fits-all tactic that any business can implement overnight. After all, the definition of trust is the “firm belief in the reliability, truth, ability, or strength of someone or something.” Reliability is a key factor in building trust, so your company should consistently deliver value to customers.

Consistently following through on your brand promise and doing what you say you’ll do over time will impact whether or not your customers perceive your brand as trustworthy.

4. Implement a customer feedback loop.

It’s hard to improve your business if you don’t know how your customers feel about it. To start retaining customers, you need a process for obtaining customer feedback and sharing that information with the rest of your organization. This is where a customer feedback loop comes in. It provides a system for collecting, analyzing, and distributing customer reviews and surveys.

There are a few ways to collect customer feedback. The most common way is with a survey like Net Promoter Score®, or you can ask customers to participate in user testing and focus groups. Alternatively, if you use a small business phone system, you can allow customers the chance to give feedback after each and every call or interaction. Using a few of these methods regularly should provide your team with ample and relevant customer feedback.

Once you’ve gathered them, you should analyze your survey results by looking for trends in customer behavior and other areas to enhance user experience. Then, share this information with teams that will benefit from it most.

For example, product reviews should be distributed to engineers and development teams so they can address flaws in your product’s design. By using this system to collect and share customer reviews, your business can efficiently address criticism and improve the customer experience.

5. Maintain a customer communication calendar.

Even if your customers aren’t reaching out with feedback, your team should be proactive in communicating with them. If customers haven’t interacted with your brand for a while, you should reach out and re-establish your relationship. Consider adopting a communication calendar to manage customer engagements and create opportunities to upsell and cross-sell.

A communication calendar is a chart that keeps track of customer communication. It tells you the last time that a customer has reached out and alerts you when existing customers haven’t interacted with your brand.

This makes it easy to launch promotional offers and proactive customer service features that remove roadblocks before customers know they’re there. For example, if a customer’s subscription is set to expire, you can send out an email letting them know they need to renew their account.

6. Send a company newsletter.

A company newsletter is a simple and cost-effective way of retaining customers because it can enhance your company’s reputation and notability. You can use email automation to send updates or offers to all of your customers at once.

And, you can send the email using an RSS feed on a designated frequency, so you don’t have to manually update the content or remember to click “send.” Even though it’s simple, newsletters can remind customers of your brand every time they open their inbox.

7. Start a customer education program.

A customer education program demonstrates a long-term investment in your customer base. Under this initiative, your business creates various customer self-service tools like a knowledge base and a community forum. Then, customers use these features to locate solutions to service problems before reaching out to your support team.

This program can extend beyond your products and services as well. For example, HubSpot Academy courses cover generic marketing, sales, and customer service topics. That way, HubSpot customers know how to use the HubSpot tools in their everyday workflow. We’ll discuss HubSpot Academy later on, but this approach has become a proven strategy for optimizing customer success.

8. Offer unique services.

Offering a product or service that’s superior to your competitors in the eyes of your customers is no easy feat, but the reward is worth it in the long run. If you’ve developed a niche for your business that solves a critical customer pain point, you’re on the right track to retaining customers.

People ultimately buy what holds value to them. Eliminating a bottleneck, removing a kink in a workflow, or automating a process in a way that no other company can is a strong reason for a customer to commit to your brand.

9. Start a customer retention program.

A customer retention program is an amalgamation of several types of tactics. There’s a program for just about every business case. Below, we define customer retention programs, explain the most common types, and show you examples of how to implement them within your organization.

By retaining customers, companies can help them derive more value from a product, encourage them to share feedback to influence potential new customers, and start to build a community of like-minded customers or users they can connect with.

What Affects Customer Retention?

Now that we’ve gone through the basics of customer retention, let’s dive into the different factors that can make or break your customer retention.

1. Your marketplace store and listings

In the same way that your store and listings are essential for driving initial purchases, they’re also fundamental to generating repeat purchases. 

An easy-to-find and navigate store leaves a positive impression that customers want to return to (and makes it easy for them to find you again).

The key things to consider when optimizing your marketplace store and listings for retention are:

• Memorability: Brand your marketplace storefront with images, logos, and colors that make it easily identifiable, memorable, and enjoyable to navigate. 
• Discoverability: Use categories, tags, and keywords in your listings that aid product discoverability and make it easy for customers to find you again. 
• Ease of purchase: Join fast shipping programs like Walmart TwoDay and eBay Fast ‘N Free that make it convenient for customers to buy from you again. 
• Item availability: Practice efficient inventory management to ensure your products are always in stock and available to purchase across all sales channels. 

If you’re selling on an ecommerce platform alongside your marketplace store, you should also consider website design, guest checkouts, customer accounts, and product recommendations that make purchasing enjoyable the first time and easy to do a second time.  

2. Product selections and variety

The products you sell have a considerable impact on customer retention levels, because your catalog should give customers a need or desire to come back.

For example, a store selling high-end furniture will naturally experience lower retention levels than a store selling affordable beauty products. Shoppers need a replacement bottle of shampoo much sooner than they need a replacement sofa. 

The general rule of thumb is that the higher-value the product, the lower the repeat purchase rate. But it doesn’t have to be

By supplementing one-off products with a variety of everyday items, you can retain customers through a series of low-value purchases that put your brand at the top of the list when they need to make a high-value purchase.

For example, that high-end furniture store could sell a range of sofa cleaning products, maintenance care, and covers that generate smaller repeat purchases between larger furniture purchases. 

3. The delivery experience

Delivery is a crucial factor for customer retention. More than a third of customers won’t return to your store following a poor delivery experience. Late, missing, and damaged deliveries create a terrible first impression that customers don’t want to repeat. 

The good news is that an outstanding delivery experience can significantly boost customer retention by creating a memorable first impression that customers seek out again.

The keys to a seamless delivery are:

• Fast delivery speeds: 2-day and next-day delivery provides customers with convenience, confidence, and immediate gratification, enhancing the post-purchase experience. 
• Free shipping: Free shipping adds value that makes shoppers more likely to buy. You can also offer free shipping as a minimum spend incentive to increase average order value. 
• Tracking updates: Delivery updates keep customers informed and give them the confidence to make repeat purchases.
• On-time deliveries: Delivering when you say you will enhances customer trust and makes them feel confident buying from you again, especially on a time crunch.
• Accurate and quality orders: Sending the correct items, undamaged and in good shape allows customers to enjoy their products immediately, and eliminates some of the most common reasons for complaints and returns. 

4. Your customer support

Proactive customer support has the most significant impact on customer loyalty, followed closely by consistently good service and fast, friendly interaction.

This means you must reach out to customers before they reach out to you, which you can do using:

• Post-purchase emails: Send a series of post-purchase emails that thank them for their purchase, confirm the delivery details, ask how they found the product and experience, and recommend relevant next purchases. 
• Delivery updates: Immediately inform customers about potential delivery delays, and quickly rectify and compensate for late deliveries. 
• Product support: Send customers information on how to use and get the best out of their products, including information on equipment needed, set-up guides, and access to your customer community. 
• Multiple channels: Invite customers to contact you via email, telephone, live chat, and social media, and integrate these channels so your support team can stay on top of multiple streams of questions. 

In all your proactive customer support, if you’re selling on a marketplace be sure that you abide by that marketplace’s rules for communication with customers.

5. Where you advertise your products

Advertising isn’t just for attracting new customers. It can be a powerful retention tool as well.

Read Also: Building Brand Awareness

Building customer loyalty on Amazon and Walmart is challenging, because customers become loyal to the marketplace before becoming loyal to you. This means they head straight to the search bar to repeat their purchase, opening them up to your competition.

Using ads across marketplaces, Google, and social media, you can secure prime positioning in the search results to reintroduce your brand to customers before your competitors can say hello. Once they recognize your store, they can bypass the initial stages of the purchasing process, allowing them to proceed more quickly to checkout.

Tip: Use Deliverr to make your Facebook, Instagram, and Google ads stand out using dynamic, fast shipping tags. These badges display 2-day or next day delivery speeds depending on the customer’s location and proximity to inventory. 

6. How you treat existing customers

If you run a D2C e-commerce website alongside your Amazon or Walmart Marketplace store, the way you treat existing customers can determine whether they return to your website or a marketplace.

You must give customers a reason to re-engage with your brand. This involves:

• Loyalty programs: Provide customers with a tangible incentive for remaining loyal to your brand, such as tiered discounts, free shipping, or gifts. 
• Engaging emails: Keep in touch with customers and send them product updates and recommendations tailored to their previous purchases. 
• Reminders: Remind customers to re-order as their products are about to run out — for example, coffee beans or haircare.
• Subscriptions: Give customers an easy way to remain loyal by offering convenient and cost-effective subscriptions. 

Conclusion

Customer retention is one of the most powerful ways to increase your business profitability while generating positive reviews, customer feedback, and higher returns on your ad spend. 

While there isn’t a magic formula you can use to boost customer retention, there are many ways to encourage it. Optimizing your listings, providing fast delivery, ensuring proactive customer service, and staying in stock encourages your customers to keep coming back.

You don’t have to tackle customer retention alone. You can work with fulfillment services, advertising partners, and outsourced customer service teams to boost retention while you continue growing your store.