Regardless of the industry in which a company is located, it is crucial to have a customer retention strategy that allows sustainable progress over time, with adequate costs and a return on the business model.
It is easy to state but complex to execute. It takes much more than a good product. It requires hard analysis and work to have, for example, great customer service, excellent web content and navigation, You need great customer service, an easy to navigate website, and a great customer experience.
The following 2020 metrics drawn from different sources on studies with different methodologies and sectors can support or help choose the path and specific aspects of it to develop or improve.
Benefits and customer retention
If the company is reducing profits due to errors in customer retention, it is possibly losing more money than due to the opportunity cost that is not being extracted to its full potential.
$136,8
They are the billions that companies in the United States lose due to avoidable customer churn (CallMiner)
- By increasing customer retention by 5%, profits increase from 25% to 95%. (SmallBizGenius)
- According to Pareto, 80% of the profits come from 20% of the clients. (Forbes)
- 65% of the business comes from existing clients in the portfolio. (SmallBizGenius)
- The probability of sale to a client of the portfolio is 60-70%. For new clients it is only 5-20%. (altfield)
- 82% of companies agree that retention is cheaper than acquisition. (SmallBizGenius)
- Businesses in the United States lost $75 billion in sales due to poor customer service in 2018. (Forbes)
- More than $62 billion is lost annually in American businesses due to poor quality customer service. (NewVoice Media)
- A 5% increase in customer retention corresponds to at least a 25% increase in profits. (Bain & Company)
loyalty programs
A loyalty program in addition to establishing a customer base, creates a customer engagement platform. Any of the chosen programs create significant customer retention.
- More than 70% of customers would recommend a brand with a good loyalty program. (Bond)
- 58.7% of Internet users believe that points and rewards are aspects of differential value in the shopping experience. (Emarketer)
- 56% of customers remain loyal to the brands that make them loyal in their program. (SmallBizGenius)
- 50% of US consumers left a brand they are loyal to for a competitor that is closer to their needs. (HubSpot)
- Members of a loyalty program spend 12-18% more per year than other customers. (foundry)
- 52% of customers subscribe to a loyalty program with their preferred company. (Yotpo)
72%
of Americans belong to at least one loyalty program (Oracle)
Customer Service
When a customer has a query regarding your product or needs to get in touch with a representative from any type of company, how quickly does the team respond? Does anyone go above and beyond to turn a dissatisfied customer into a satisfied one? There are key and continuous improvements in all customer service processes.
93%
of customers repeat purchases in environments with great customer service (HubSpot)
- 86% of customers value the emotional connection with the customer in a way that makes them do business with companies. (Forbes)
- 54% say they have had one bad customer service experience per month. (HubSpot)
- 69% of customers build brand loyalty through good customer service. (Microsoft)
- 45% of women take more than 2 years to return to a provider if they have experienced poor customer service. (Zendesk)
- 37% positively value the apologies of a company when it offers them a bad service experience. (CallMiner)
- 67% of customer churn could be avoided if their queries are resolved in the first iteration. (kolsky)
- 74% of millennials switch providers due to poor service. (BusinessWire)
- 90% of millennials prefer the smartphone for consultation or support iterations. (Genesys)
- Faced with poor customer service, 20% of them communicate it publicly through their social networks. (NewVoice Media)
- 82% of customers have stopped producing business for the company after poor customer service. (Zendesk)
- Just over 10% of customers stay online for more than 5 minutes on an information or service contact. (HubSpot)
- 83% of customers prefer to interact with people before a digital voice service. (Accenture)
- 66% of B2B customers stopped buying after poor customer service. (Zendesk)
- 52% have bought more from the same company after having a positive customer service experience. (kolsky)
Personal details
From address to credit card details, customers provide companies with data on a constant basis. Ensuring the confidentiality and security of such information encourages trust and purchase. Otherwise they will always choose to switch to the competition.
- 87% offer more personal details in exchange for more offers and benefits obtained from the brand. (Bond)
- 68% of customers believe it is important for companies to tailor experiences to their preferences. (Oracle)
- 56% of Americans believe that brands do not have their interests in mind when using, sharing or storing their data. (aquia)
- 83% of consumers offer their data in exchange for personalization. (Accenture)
63%
of customers provide more personal information to a company that provides great service (PWC)
Customer experience
As soon as a customer links with the business, they do so with the brand. We must ensure that this experience is positive.
48%
They have left the website in the process of buying from a competitor due to a bad image or process.(Accenture)
- 34% do not buy from a brand after a bad experience. (Oracle)
- Customers with an emotional relationship with a brand have a business value of 306% and 71% recommend it, compared to an average of 45%. (biker)
- 71% want a consistent experience across channels but only 29% say they have it. (Forbes)
- After a good experience with the company, 77% of customers recommend it to a friend. (XM Institute)
- 89% of customers start a relationship with a competitor after a bad experience with another company. (Oracle)
- Only 19% of companies have a team dedicated to the customer experience with the aim of constantly designing and improving it. (Genesys)
- 41% of customers, and 47% of millennials, would pay up to 20% more for a great customer experience. (Oracle)
- Companies with good experiences are priced 16% higher on products and services. (PWC)
- After a negative iteration, 58% do not have contact with the company again (NewVoice Media)
- 66% of consumers are influenced more by good experiences than by advertising. (PWC)
- 56% of customers base their purchase decision on the positive experience. (Deloitte)
- 80% of North American consumers believe that the speed, convenience, knowledge and quality of service are relevant aspects in a positive customer experiencesystem. (PWC)
- 67% of people say they have increased their expectations regarding a quality experience. (Salesforce)
- 32% stop doing business with a brand after a bad experience. (PWC)
- 77% of customers and 60% of millennials say they have had relationships with certain brands for more than 10 years. (In Moment)
- 66% of customers say they would pay more for the product or service with a better customer experience (82% of business customers). (Salesforce)
Marketing
From social networks to email campaigns, these tools are part of marketing plans to attract, retain and retain customers and create new interests in them.
- 65% of customers between 18-34 years old believe in social networks as a support channel. (Microsoft)
- 80% of companies use email campaigns as a retention tool. (emarsys)
- 69% of people do not believe in advertising. (HubSpot)
- 65% believe that a positive experience is more influential than large advertising campaigns. (PWC)
- 53% of people abandon a mobile website if it takes more than 3 seconds to load. (Google MarketingPlatform)
57%
wouldn't recommend a business with a bad mobile version(sweet)
Conclusions
When the company truly tries to understand customers, what they want, and how they interact with products or services, then a brand can be built that encourages customer return. It is key to show that the company values putting the customer's needs at the center, and this reverts to solid long-term relationships.
