For every business, customer loyalty is a hard-earned wealth. Loyal customers would not only choose your brand over others every time, but they would also spread good word-of-mouth for your business and become your brand advocates. They would speak excitingly about your brand and attract more customers for your business. That’s the best kind of marketing if you ask me.
In a world where customers tend to move on to your competitors after one or a series of bad experiences, staying your customers’ ‘favorite’ isn’t an easy feat. And having to constantly chase new customers is not only far more difficult, but it is equally expensive too.
According to ForestResearch, it costs five times more to acquire a new customer than to retain an existing one. Therefore, for businesses looking to thrive long-term, creating memorable customer journeys and retaining customers is the key.
In this article, we will talk about how listening to the voice of customers can help you in retaining them while also improving your business offering.
How to use Voice of Customer to Improve Customer Retention?
- Identify why Customers are Leaving
- Enhance your Product & Services
- Improve Customer Experience
- Improve Customer Relations
- Optimize your Marketing Efforts
Let's dive into it and understand more.
1. Identify Why Customers Are Leaving
Before you make strategies to improve customer retention, it’s important to take a step back and figure out the reason why customers are leaving in the first place. If you know what’s causing a dip in your customer retention rate, you can fix the problem and ensure that no further customers jump ship.
So, how do you do this?
One strategy is to listen to the voice of customers who have already left you. A customer relationship management tool helps you keep track of customers’ activities. So, if you notice a few customers who made a purchase long back and never returned, send them a VoC survey to check what went wrong. Surveys can work wonders in getting you customer data that highlights the problem. They can be automated and sent to all the customers who haven’t done business with you in a long time.
VoC surveys can also be conducted on-site through a mobile device or a kiosk station to capture feedback while the experience is still fresh in customers’ minds. The purpose of each is to measure the customer satisfaction score and encourage customers to share their feedback to help you fill the gap between customer experience and customer retention.
You can also send personalized emails to old customers asking them if they have a complaint. While some customers may take time to reply to you and share valuable insights, some may totally avoid it. However, all of them would know that you care about your customers and their experiences with your business. And it won’t be completely wrong to say that it’s half battle won.
2. Enhance Product
In 2004, LEGO launched a crowdsourcing platform called LEGO Ideas, where fans and contractors would submit their ideas for new LEGO designs and people would vote for their favorite creations. The platform received suggestions from over 1 million people, and the contributors of winning ideas earned a percentage of product sales. This VoC program lifted revenues and saved the company from its financial turmoil in the early 2000s.
VoC program plugs perfectly into your product development and enhancement strategies because who better than the end-users themselves to tell you what’s good and what’s bad about the product or service you offer. Moreover, to catch up with recent customer demand trends, businesses require listening to the voice of customers. VoC surveys and social media can be a huge help here.
Through surveys, you can ensure that every interaction your customers have with your brand adds value. A question as simple as “what can we do to serve you better?” can help you understand customer sentiment and pinpoint the problem to be able to resolve it effectively. VoC surveys also help you keep up with the new customer requirements and introduce changes that actually ensure customer buy-in.
Similarly, social listening helps you quickly know when your customers speak good or bad about your products/services. Immediately responding to social media complaints will showcase your brand’s proactiveness and will encourage customers’ trust in your brand. Moreover, a social media post asking customers what they would like to see improved will help you generate insights critical for steering product development and enhancement. It isn’t for no reason that 65% of Fortune 100 global companies engage with the world through Twitter.
3. Improve Customer Experience
Gartner’s research suggests that 89% of businesses are expected to compete on customer experience. This is because someone out there can sell exactly what you’re selling, but the kind of customer service you offer is what makes you unique.
There could be many things that could upset your customers, such as long waiting time before getting in touch with a human, being trapped in automated self-service calls, or unavailability of in-store staff for product return. And to make sure you’re not losing your customers to these mistakes, you need to make sure your customers feel heard and that there’s always a representative available to help them.
Begin by unearthing customer service issues through various channels – live chat on the website, NPS surveys post customer service calls, real-time survey devices at customer support centers and stores, etc. Once you have customer data, you can identify complaint trends and analyze longstanding issues. Factual data will help you chart out a clear customer retention plan and empower your customer experience team to deliver that gold-standard value.
Irrespective of the kind of VoC program you’re using, your focus should always be on closing the feedback loop faster. Customers are not satisfied with the quality of a product? Offer them an exchange or refund. Customers do not like long calls talking to a machine? Employ more customer service agents or figure out a way to reduce waiting time.
Every problem can be solved. Or, at the least, a genuine and empathetic apology can be offered to earn a second chance from your customers. The biggest game-changer is how accurately you’re listening to the voice of your customers.
4. Improve Customer Relations
You know that your business is doing great if you’re getting repeat purchase orders from your existing customers. Focusing on repeat customers and making them feel valued is the key because they are 31% more likely to spend more than your new customers. And that’s not it; old customers are loyal to your brand and would most likely promote your products or services every chance they get. So, in addition to targeting new customers, focus on continuing to deliver value to old customers.
And a great way to do that? Introduce customer loyalty programs.
Aren’t you always tempted to shop from the same online store that accumulates loyalty points to your account every time you shop with them? And why wouldn’t you leverage premier customer benefits and always buy from the same brand?
All these features are part of businesses’ customer loyalty programs. Offering your loyal customers benefits and incentives is a way of telling them that they are valued. And businesses that show how much they care about their customers surpass their competitors and clearly stand out of the crowd.
Customer loyalty or customer retention plans are also aimed at increasing revenue. Discounts and rewards encourage customers to increase their average order value or shop frequently. And this benefits both you and your customers.
5. Optimize Marketing Efforts
The best thing about Voice of Customer programs is that all of them are designed to generate data, and data can be useful in more ways than you think. VOC tools enable businesses to collect customer feedback and reviews from different channels, which are then tagged with sentiment keywords and built into summarised reports. And every customer feedback report gives businesses a solid understanding of what it is that the customers want.
Market What Sells: Voice of Customer helps you learn what it is that would sell, thereby improving your marketing efforts. For example, if customers report that they find your product ‘convenient’ or ‘easy to use,’ know that there are hundreds or thousands of others with the same selection metrics. This can help in marketing your product in a language that your customers are familiar with.
There is a high chance of better air conditioner sales if it is marketed as ‘Quick Cooling Air Conditioner’ rather than just ‘Air Conditioner.’ Listening to the voice of customers will help you position your brand accurately, which can highly determine your sales and revenue.
Created Hyper-Targeted Online Ad Copies: Voice of Customer also helps you improve your online ad targeting efforts. Customer relationship tools and VoC surveys collect customer data that contributes to identifying various segments of customers and their unique preferences. For example, if the biggest percentage of your home workout kits are working mothers, you can target your ads with the copy – Best Home Workout Kits for Working Mothers. Creating super-targeted ad copies by leveraging the customers’ voice is the home run you need to up your marketing game.
Acquiring new customers is sometimes a lot harder than retaining the existing ones. So, if you are working effectively towards lead generation, make sure to consider investing in VoC programs to gauge the pulse of your customers.
We have already established how various VoC tools, such as surveys, live-chat, social channels, etc., help in understanding customer requirements and customer satisfaction. Now all you need to do is measure your business requirements and create a comprehensive Voice of Customer program to achieve excellent standards of experience and retain your valuable customers.