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3 customer retention myths busted

Posted by Perceptive Insights Team - 31 July, 2017

3 customer retention myths busted

In a business world powered by data, misinformation is more detrimental to success than having no insights at all. To ensure you remain protected from these customer retention myths, we'll shed light on three of the most common misunderstandings in the market today.

Read more: The Customer Retention Playbook

 

1. The goal should be 100 per cent customer retention

Having ambitious customer loyalty metrics is one thing, but making them unachievable is quite another.

The reality is that different customer segments churn at different rates, at different times and for different reasons. Your one-off customers, which for many companies may make up the bulk of their sales figures, often won't come back no matter how grand a customer experience you give them. They may walk away happy and act as promoters for your brand, but you may never receive their business again.

In fact, trying to do so can end up having a negative outcome rather than a positive one. Trying to achieve a 100 per cent retention rate may lead your team to neglect segments of your customer roster that would benefit from your retention strategy. In essence, it is better to pick your battles and focus on the right customer journey.

 

2. Satisfied customers are loyal customers

We believe that delighting your customers is an integral part of lead generation as well as retention. But you might be surprised to learn that simply satisfying your customers isn't enough.

It may seem counterintuitive, but one study from the Customer Contact Council uncovered two important insights into the customer retention process: firstly, that traditional means of delighting customers doesn't improve loyalty nearly as much as making their problems easier to solve does; secondly, that basing your strategy around a problem-solving approach can improve your customer service and, ultimately, reduce customer churn.

Basing your strategy around a problem-solving approach can improve your customer service.

Delight takes many forms, and if your intent is to retain customers, it should take the form of making it as easy as possible for customers to solve their problems. This is more effective than following conventional wisdom of satisfaction being synonymous with loyalty.

 

3. One silver bullet to boost retention levels

Don't fall into the trap of thinking that there is a single silver bullet for your customer retention issues. Customers leave for a myriad of reasons, and sometimes the problems you are trying to solve can't be easily rectified. Much like the reasoning for the first myth, you can't retain every customer.

But you can find out why they left and stop these issues from appearing in the future, assuming you have access to the right analytics. You'll discover that people leave for a wide variety of reasons, and some have no specific reason at all.

This is why every customer retention strategy should be a multi-pronged approach, based on the right analytics and rolled out and constantly improved over a long period of time.

 

And if you want to learn more about customer retention strategies, check out our free guide to customer retention strategies below:

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Topics: Customer Experience


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