How to Improve Customer Retention

You already know that customer retention is a key driver of business growth and profitability. But how to do improve customer retention? That’s the question we will try to answer in this post.

The Importance of Customer Retention

How To Improve Customer RetentionDepending on the industry (and the study being cited), finding new customers can range from 5 times to 25 times the cost of keeping the ones you already have. That fact was as true in 2014 when the Harvard Business Review explored the subject as it is today.

But it’s not just the cost of acquiring new customers that makes the existing customers valuable. Loyal customers also spend more money and do it for a longer time. And if that’s not enough, research from the people who created the net promoter score says that a 5% increase in retention can yield a 25% jump in profits and perhaps more.

So, what is your customer retention strategy? If pressed for a monthly or annual churn rate, are those numbers readily available? They should be. Retention is as critical a KPI as any other metric that defines operational success. A low customer retention rate is the mark of organizational instability. Left unaddressed, it will cause more severe problems. In this article, we’ll explore some easy-to-implement steps for customer churn management and improving customer retention and the benefits your organization will gain.

Proactive Engagement Increases Customer Retention

How To Improve Customer RetentionCommunication is among the hallmarks of any successful relationship, be it personal or business. The more of it, the better. It can be easy to forget a customer after the initial sale. It is also a mistake.

Retention starts when the relationship starts. The onboarding process should include welcome calls from brand representatives or other communications that say, “We’re glad you’re here; do you have any questions so far?”

Customers’ initial enthusiasm about a product or service can fade if there is something they don’t understand or they see themselves as taken for granted. Businesses put a great deal of emphasis on courting new customers, and it is vital to be equally engaged with the ones they already have. Proactive contact, especially when the only goal is to check in, is one means of making clear to your customers that they are valued and that the customer care team is ready to assist with any issue.

If the only time you’re contacting customers is to sell them something, they will eventually tune out those messages or sour on the brand altogether. But if you’re periodically reaching out “just because,” then the occasional sales offer or product introduction is perceived as less intrusive. That communication can also be personalized to individual users based on purchasing history or preferences, making it more relevant and more likely to generate a positive response.

Creating a Positive Feedback Loop Helps with Customer Retention

How To Improve Customer RetentionCustomer outreach is not a checklist item to be rushed through; take time to hear what product users say and ask clarifying questions. A team can be dedicated to this role, or it can be done during regular support and service activities, but the point is to do it. There is no better source of information about the perception of your brand and the utility of the goods and services you sell than the people who use them. And when you do this honestly, customers feel wanted and are likely to stay on for longer.

Consumers will spell out what they like, what needs improvement, future developments they’d like to see, and so forth. Their feedback is a tremendous resource that provides priceless insight into how operations can be improved. As much as anything, customers want to be heard; listening to them and acting on that information is a good way of establishing credibility with your user base. This should be supplemented with loyalty incentives and rewards programs that tangibly recognize customer value and perpetuate the feedback cycle.

The Value of Trust in Retaining Customers

How To Improve Customer RetentionYour buyers choose to do business with you for a reason: they believe in the quality of what they’re purchasing and the value it will bring them. Reinforce their belief with a level of customer care that validates their original purchasing decision.

This can be done in several ways, beginning with rapid response to customer inquiries and a high rate of first-contact resolution. Provide multiple channels of communication that make the process convenient for them and engage them by name. A good CRM solution helps with personalization, as it will include user histories.

When consumers trust what they buy and the company that stands behind it, they are far more likely to continue buying. In addition, loyal customers are an excellent referral source who will act as champions of your brand. They provide the one thing no advertising budget can buy: a third-party endorsement without expecting anything in return. However, including referrals with a rewards program is a good idea.

Customer Service Agents Are Critical to Retaining Customers

How To Improve Customer RetentionThe organization has an established cadence of welcome calls and regular outreach, rewards and loyalty programs, and service agents who contribute by hearing the voice of the customer for information that can help the business improve. What else?

How about training and empowering the support team to deliver the type of user experiences that consumers rave about? Every memorable customer interaction includes an agent who was prepared and motivated to deliver it.

Every organization strives to connect with its customers across multiple checkpoints and speaks of customer lifecycles. The same issues apply to the staff. Keeping bright and talented people is simply good business. Failing to do so leads to attrition and dissatisfaction, both of which will negatively impact customer retention.

Pay and benefits are part of every job, but they do not wholly define the agents’ experience. Are associates provided with means of providing feedback and ideas, are their career paths available for them to pursue, and is the workplace culture one they look forward to joining each day?

Happy agents tend to result in happy customers.

A Final Thought

There is endless literature on the 80/20 rule and its different applications. In business, it refers to 80% of corporate revenue being generated by 20% of the customers. But you cannot know who the 20% will be until they become customers.

Some customers will buy once and be happy. Others will buy a few times and perhaps switch brands. That’s normal human behavior. Every enterprise experiences some churn. The goal is to minimize the rate by providing customers with reasons to stay.

It starts by setting a positive tone through smooth onboarding and a welcome. It continues with regular outreach, gathering feedback to understand shifts in consumer sentiment and getting ahead of trends, and ways of rewarding loyalty. Augment that with a well-trained support team that understands the revenue impact of quality service, and you are on the right path.

And keep up with retention and churn rates to spot potential issues and opportunities and act on them.

About GlowTouch

As a tech-forward company, GlowTouch is dedicated to providing exceptional customer experiences by leveraging the right people, channels, locations, processes, and technologies. Our personalized omnichannel contact center, back-office processing, and technology outsourcing solutions are tailored to meet the unique needs of clients worldwide. As a certified WBENC Women’s Business Enterprise (WBE) and NMSDC Minority Business Enterprise (MBE), we take pride in our diverse workforce. Our commitment to operational excellence and high-touch engagement has earned us recognition from renowned organizations such as Everest Group, the International Association of Outsourcing Professionals (IAOP), and six-time inclusion on the Inc. 5000 list. Headquartered in Louisville, KY, we have a global presence with onshore contact centers in Louisville, Miami, FL, and San Antonio, TX, a nearshore center in Santo Domingo, Dominican Republic, and offshore locations in Mangalore, Bangalore, Mysore, India, and Manila, Philippines. To learn more about how we can help you achieve your business goals, visit, or email Tammy Weinstein at

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