9 Customer Retention Examples from Top Companies
Did you know your company has a significantly higher chance of selling to an existing customer — between 60-70%? Compare that to the odds of selling to new customers, which can be as low as 5-20%.
Investing in customer retention strategies to keep pre-existing customers around is crucial for strengthening the connection with consumers you've already sold to. Failing to do so can result in missed opportunities and significant costs.
If you're not sure where to start with customer retention, it's a good idea to look at examples of companies that are doing it right. These companies understand the importance of keeping loyal customers satisfied, and by following their examples, you can develop a successful customer retention strategy that works for your business.
Customer retention refers to the number of customers loyal to a business over time. Your company’s customer retention strategies refer to the programs the organization has in place to ensure your consumers don’t turn away from the organization and seek your product from a competitor. Many of your customer retention strategies can be automated, so don’t worry about them taking up too much of your time.
Still, your company's customer retention techniques can’t feel superficial to your consumers. According to a survey by Redpoint Global, 74% of consumers report they decide to stick with a company because they feel understood and valued. Regardless of your current customer retention techniques, that’s your goal.
In other words, customer retention isn’t as costly as customer acquisition. If you’re not focusing on making loyal customers out of existing ones, you’re missing out on a tremendous opportunity to save your business money in the short and long term.
By enacting customer retention strategies, you’ll reduce your customer churn rate. The best part is that the customer retention techniques your team puts in place will result in greater customer satisfaction. The customer lifetime value will increase and your revenue will too.
Investing in customer retention may require some upfront costs, but it’s far less expensive than constantly seeking out new customers. By demonstrating a commitment to preventing customer churn, your company can save money, increase customer success stories and show your consumers you truly care about their satisfaction. Remember, customer retention is key to the long-term success of your business.
In today's business world, where competition is fierce and customers have more choices than ever, building and maintaining customer loyalty is essential for the success and growth of any company. That’s why investing in building relationships with customers and providing them with a seamless and delightful experience at every touchpoint is imperative. What better way to learn how to do that than examples from successful industry giants?
Here are some customer retention companies with engaging programs in place to boost the number of repeat customers.
Uber is a transportation service that allows users to connect with a ride directly on their mobile devices. Founded in March 2009, the company’s referral program helped propel it to its current level of success.
When Uber began, it enticed its customers to share the product with their friends by offering a $10 referral incentive. The idea was: you refer a friend, and you both get $10 in Uber credits to use on your ride. When the company grew, it was able to offer more costly referral credits, ranging from $20-30.
This is one of the best examples of customer retention strategies because it’s simple yet effective. In other words, the offer works.
Notice that by offering the referral credit to the existing customer and the new one, the focus isn’t just on acquiring new users but retaining customers, too. Plus, the program is easy to use: just sign up, share the referral and you’re all set.
Another exceptional example of customer retention is Amazon, a technology and eCommerce company. The organization has successfully reduced customer churn by offering an excellent user experience.
One of Amazon’s keynote features is its ability to offer a highly customized user experience. Because of this, you can easily find items you may be interested in displayed on easy-to-access landing pages.
Another thing Amazon does right? They’ve made the returns process easy and hassle-free. Customers can easily return products they are not satisfied with, and Amazon takes care of the rest.
By serving up an excellent user experience, you’re telling your customers that their ease of use on your website is your main priority. And if your company treats customer experience as second in priority to selling your product, you’ll notice how quickly a customer complains.
Apple is an example of how exceptional customer service can make or break the experience your consumers have with your brand and how willing they are to return.
Apple, a California-based technology company, leaves nothing to chance with customer service. Instead of letting unauthorized third-party providers care for your Apple product, they offer customer service directly in their stores. This ensures your customer service representative is trained and competent.
As a result, the customer interactions at Apple are generally positive. This is an excellent customer retention strategy as it demonstrates that when you buy the product, you’re not only buying an item, you’re purchasing a lifetime’s worth of support from the customer service team.
According to CX Index, customer experience drives two-thirds of customer loyalty. Even if you’re investing in your customer retention program, if your customer service slacks, consumers may not return.
Next up is REI’s customer loyalty program. With customer loyalty programs, the key is to offer benefits that consumers want. REI, an outdoor recreation commerce company, does exactly that.
The Co-Op membership program is unique for various reasons; you have to pay for it for starters. While it does cost customers a bit of money upfront, it’s still highly popular because it offers benefits customers want.
That’s what distinguishes a valuable customer loyalty program from one consumers don’t care about: how desirable the rewards they reap from being a member are. In the case of REI, members get money back in the form of store credit, plus exclusive discounts on services and access to exclusive gear.
Nike again proves that customer acquisition is only half the battle; the other half is to continually make your consumers happy. With robust omnichannel marketing techniques, Nike, an apparel and footwear brand, takes customer expectations to the next level.
It boasts several apps created with user experience in mind, not to mention they consider where the user is geographically located to help them find a physical store or make a product recommendation. However, that’s not all Nike does to maintain customer engagement and satisfaction; it’s also highly accessible, as you can visit the website and chat with a customer support representative or visit its Twitter customer service account to discuss your order.
IKEA, a Scandinavian furniture store, proves that customer retention companies vary in their approaches. IKEA does customer retention a little differently: by focusing on educational content. Some of its most popular educational features include an interactive design tool on its website to help you understand what a product may look like in your home.
The company also publishes tutorial videos you can watch to get a better idea of how to build the furniture. While this is a time and resource investment for the company, it proves worthwhile, as it appeals to visual learners who may otherwise grow frustrated attempting to assemble their item.
Luxury department store Nordstrom uses customer feedback to increase customer retention. Because Nordstrom uses surveys to understand what they’re doing wrong or right, the company can better deliver an experience that meets or exceeds customer expectations.
Additionally, gaining user feedback allows the company to better understand what consumer behavior differentiates a casual browser from a dedicated, repeat buyer. Then, the brand can analyze feedback and make changes as necessary.
Digital music service Spotify demonstrates how a subscription service can use predictive analytics and personalization to enhance customer experience and reduce customer churn. Spotify is well-known for its hyper-personal playlists, such as the ‘Weekly Discover’ or ‘On Repeat,’ which considers the user’s personal taste. Another example of this focus on personalization is the ‘Spotify Wrapped’ playlists it produces for each user annually.
Additionally, Spotify’s predictive analytics allow the subscription service to recommend songs for playlists users will enjoy. By using the data Spotify already has on listeners, it can accurately guess what will appeal to them. This demonstrates one effective subscription model: keep visitors returning by serving recommendations they’ll love.
Lastly, Peloton, the popular exercise equipment and platform company, has set a great example of how community building can strengthen customer retention strategies. By offering various community-centric features like the Leaderboard, High-Fives and Here-Now, Peloton enables its users to feel connected with other riders, thus creating an invaluable sense of community.
Additionally, Peloton allows users to video chat with their friends during a ride, further enhancing the platform's community aspect. As a result, users are more likely to return to the platform, thanks to the sense of belonging.
Looking at how other companies keep their customers returning for more can help you figure out what will work for your business. You might have noticed there are many different ways to ensure your customers are happy and want to stick around.
It's not always easy to know what will work, but taking inspiration from other businesses can be a great place to start. Remember, what works for one company might not work for yours, so it's important to determine your unique approach. You're doing it right as long as your technique appeals to consumers and leads to a bump in your customer retention rates.
That said, don't miss out on valuable insights that could boost your own customer retention strategy. Contact us today!