3 ways to improve the retention and the customer experience

When I started my professional activity as a sales assistant at Zara It was the first time I heard the expression: “The goal is not for the customer to come to the store, it’s for him to come back here.”

Several studies indicate that the cost of getting a new customer can be up to 25 times higher than retaining a current customer. Based on this information, the search for methods that allow us to retain and involve current customers with the brand gains new importance.

Let’s start with the basics: how do you calculate a customer’s retention rate? This rate is achieved through the following steps:

1. definition of the base period in which you want to calculate (1 month, 6 months, 1 year, etc.)

2. calculate the number of customers you had at the beginning of the calculation of the period

3. calculate the total number of customers you have at the end of the period under review

4. subtract the number of new customers from the total number of initial customers

5. divide the total number of customers you have at the end of this period by the number you had at the beginning and multiply by 100.

By carrying out these 5 steps you will have the customer retention rate.

Formula: 100 x ((Clients at the end of the period – new clients) / clients at the beginning of the period))

After reaching the number of the retention rate of your customers, we move on to defining strategies to be put into practice.

1) Ask feedback to customers and use it in your favor

This is undoubtedly a strategy that when it began to be applied consistently at OK Estudante was a game-changer. Knowing the opinion of who we most want and need to please is in itself a big step towards getting closer to providing an excellent customer experience. This feedback can be collected through email surveys, or even in customer meetings. The thing to keep in mind is to collect information about how the customer evaluates the company and their experience. No less important in this process, based on the information collected, group it into categories and then prioritise the measures to be taken for each one of them.

2) Customer Journey Identification

By mapping the various points of contact between the customer and the company, these will allow us to identify possible improvements, since by identifying where the biggest customer complaints originate, we can improve this moment of the journey in particular. It may also happen that we realised that there needs to be one more step in the entire customer Journey and that, by including this one, it is likely to increase the level of satisfaction with the brand, and consequently to increase the retention rate.

3) Communication and Expectations

It has always been and will always be preferable for us to offer more than what we promise. Unfortunately in most organisations the equation doesn’t work like that leaving the customer frustrated with a service well below their expectations. The quality of a product is equal to the value it offers minus the expectations it has. If, as an organisation, they offer a value that always exceeds the customer’s expectations, they have all the conditions to increase their retention rate.