Keeping customers loyal is vital for business success. In fact, just a five per cent rise in your customer retention rate can provide a 25 per cent increase in revenue*.
According to Accenture Strategy, 68 per cent of customers will not go back to a business once they’ve decided to switch. So what could have been done to keep these customers? The most effective method is to understand who they are and listen to what they have to say.
Ask your customers for their feedback
Customers will always have an opinion about their experience in your business, though they may not always voice it, for every customer that takes the time to complain, 26 remain silent. Allowing every customer an easy opportunity to provide their thoughts gives you the opportunity to understand just what they’re thinking – good and bad.
Collecting customer feedback isn’t just about whether your service is up to scratch, hearing what they’ve got to say about your products can be a business-changing insight. In fact, TruRating data shows 15 per cent of customers feel the menu at their local cafe could do with an update and more than one in 10 customers who make a purchase in a retail business have actually been disappointed by the product range they’ve been offered. Data like this is priceless.
Gather lots of feedback and about more than one aspect of your business
How many reviews do you have of your business? Ten, a hundred, more? Does the number of reviews equal the number of customers, though? What about the ones who left silently?
Mass feedback gives you the ability to track trends about your business at a big data level, not just trying to please the disgruntled minority who are motivated enough to leave a review on an online site. The more data you have the more you can ascertain what changes to make that will affect the majority and give you the best return of happy customers and revenues.
To make mass data really useful you’ll need to track against at least five key areas of customer satisfaction: value for money; likelihood to recommend; range of products; customer service; and customer experience. This will help you understand which areas you need to improve and which areas you’re excelling at, giving you the ability to manage staff, operations, products and more with a much more informed view.
Let your customers know you’ve heard them
Business improvements don’t always need capital outlay to be rewarding. One large shoe retailer used our ratings system to uncover that the perception of their value for money was low, and that this was a key revenue opportunity in their business. Rather than lowering prices or discounting which will have degraded their bottom line they simply changed the way they communicated their product. By transitioning from a feature led conversation (type of materials used in the shoe) to a benefit led conversation (how the quality of the materials led to a better feel, fit, overall experience for the customer) they saw their customer spend rise week on week by 11 per cent.
Feedback is the ultimate tool in learning exactly where your business is successful, and where there is room to improve. Sales could be up or down, but without understanding whether it is the menu, decor or an inefficient employee, you cannot be sure that an investment in making changes will create a better customer experience that will drive business success. Let’s be honest – there’s no point in asking for feedback if you’re not going to engage with it or take it seriously.
* http://www.bain.com/publications/articles/loyalty-a-prescription-for-cutting-costs.aspx
Sophie Jillings, Head of APAC, www.trurating.com
