Imagine you’ve put in weeks of work to get a new customer on board. You’ve walked them through your product, tailored the pricing plan to their budget, and checked in to make sure they’re happy.
Two months down the line, you get the notification: they’ve closed their account.
Now, you’re back to square one, sourcing new leads and working hard to move them through the sales cycle.
This is where customer retention management comes in. It helps you create long-lasting relationships with each customer, keeping them loyal to your brand.
Your contact center agents are the key to accomplishing that. They’re the ones talking to customers day in and day out, figuring out what they need, and putting out fires.
Here, you’ll learn more about customer retention management and its benefits — with seven strategies to leverage your contact center solution to nurture vital customer relationships, ensuring they stick around for the long haul.
What Is Customer Retention Management?
Customer retention management is the set of processes and strategies you implement to keep your existing customers happy and loyal to your brand. The ultimate goal of any customer retention program is to increase customer engagement, reduce customer churn, and support a healthy bottom line.
Key functions of customer retention management
- Prioritizing existing customer relationships as highly as attracting new ones
- Delivering value at every stage of the customer journey, from the first time they hear about your offering to after they’ve made a purchase and need support
- Engaging customers actively through multiple channels — like your contact center, social media, and email — to understand and meet their needs
- Maintaining positive relationships through efforts like timely customer service, personalized interactions, and high-quality products or services
- Asking for, listening to, and acting on customer feedback consistently to make your products and services, including the overall customer experience (CX), even better
Why You Should Prioritize Customer Retention Management
Keeping your customer retention rate up can significantly increase the customer lifetime value (CLV), reduce the cost of acquiring new ones, and enhance the overall experience and satisfaction of your customer base.
Let’s look at what makes customer retention important in more detail.
1. Increased CLV
CLV represents the total amount you expect a customer to spend on your products or services over their entire relationship with your business.
Your current customers already trust and value your company, so they’re more likely to make repeat purchases and recommend your brand to others, increasing their CLV.
A recent study out of UC Berkeley found an exponential relationship between customer retention rates and CLV.
Basically, the longer your customers stay with you, the more value they bring to your business. This value rises at an increasing rate.
2. Reduced customer acquisition costs
Your customer acquisition costs (CAC) are the amount of money you spend to get a new customer.
This includes expenses like advertising, engaging potential customers through your contact center, and conducting direct sales outreach.
When your current customer base is happy and stays with your company longer, you don’t need to spend as much on customer acquisition. Plus, satisfied customers tend to recommend your business to people they know. These referrals help you get new customers without having to spend a dollar on marketing or sales to acquire them.
3. More opportunities for upselling & cross-selling
Upselling is when you encourage a customer to buy a more expensive version of a product they’re already interested in.
Here’s an example of upselling from Dollar Shave Club:
Cross-selling, on the other hand, means suggesting related products or services that complement what the customer is buying.
Here’s an example of cross-selling from Galaxus:
Loyal customers who already like what you offer and have had a positive experience with you are more willing to check out new products and services and expand their relationship with you.
Imagine you’re a customer success manager at an online shop specializing in photography equipment. You’re collaborating with the sales department to identify people who’d be open to buying the new camera lens you’ve just started offering.
You have two options:
| Kevin | Eve |
|---|---|
| Kevin is a loyal customer who’s bought equipment and camera accessories from your store five times in the last year. He reads most of your newsletters and recently praised your customer support in a survey. | Eve knows of your brand but hasn’t bought anything yet. She’s hesitant, doubting whether your products are worth the investment or will significantly improve her photography. |
Which of these two customers is more likely to buy your new, premium camera lens? Kevin, with his loyalty and firsthand experience of your product quality, or Eve, a potential but uncertain customer?
Kevin, right?
4. Better understanding of customer needs
Through your customer retention efforts, you’re constantly in touch with your customers.
This close contact lets you see what works for them and what doesn’t. Understanding their needs and pain points helps you make smarter choices about your products or services.
It takes the guesswork out of product development and service enhancements so you’re using real feedback to make things they’ll love.
This makes your offering customer-first, which can boost your revenue and overall user experience.
5. Improved CX
To retain your current customers, you need to maintain high standards of quality and service.
This includes:
- Offering personalized experiences, like using customers’ names in communications, remembering their preferences and purchase history, and making tailored product recommendations
- Ensuring first-call resolution and solving customer issues in a single interaction
- Following up regularly post-service to ensure customers are happy with their purchase
- Implementing loyalty programs to show appreciation for their continued business
As you focus on nurturing your current user base, you’ll naturally create a better CX for them, turning one-time buyers into long-term fans.
Remember, great customer service is the reason 88% of customers stay with a brand.
It also boosts word of mouth, making three out of four people more likely to recommend a company to others.
Seven Strategies for Managing Customer Retention in Your Contact Center
Here are seven customer retention strategies to help you hang on to your best customers:
- Create personalized CX
- Offer proactive customer service
- Train reps to resolve issues quickly
- Offer omnichannel support
- Create a customer feedback loop
- Empower your agents
- Choose the right contact center platform
1. Create personalized CX
Offering your customers personalized experiences helps make them feel understood and valued by your company.
It also makes it easier to exceed customer expectations, making them more likely to keep coming back.
A 2021 Segment study revealed that surveyed customers are 60% more likely to become repeat buyers after a personalized shopping experience — a 16% increase from 2017.
This number is expected to rise. According to Salesforce, 73% of customers expect better customization as technology advances.
One way to achieve this is by tailoring interactions based on customer history, preferences, and feedback, but remember to always keep it in balance.
“Be transparent about how the customer data was gathered. Using the customer’s name or referring to their recent order is usually a good way to personalize their experience. But personalizations can go from relevant to creepy when the customer notices that the personalized recommendations or offers are based on information they didn’t willingly disclose to the company.”
~ Edita Vaskeviciute, Director of Customer Support at Omnisend
Let’s say you have a customer who gave feedback about needing more detailed tutorials for your product. You can use this data to make each interaction feel personal and relevant.
For example, the next time they reach out, you can acknowledge their feedback and provide links to step-by-step guides or offer a one-on-one walk-through session, specifically addressing the areas they found challenging.
You can use a CRM or CX platform to help you keep track of this information.
Pro tip: Nextiva’s Customer Experience tool unifies all your customer communications and gives your reps a clear view of each prospect and customer’s sentiment and history.
The next time a customer contacts you, your reps can instantly access their previous concerns and preferences, allowing for a more informed and personalized conversation.
2. Offer proactive customer service
Offering proactive customer service means identifying and responding to an issue before the customer even reaches out.
This approach shows customers that you’re attentive and committed to their satisfaction, which can build trust and reduce churn rate.
According to Gartner, it can even result in a full point increase in a company Net Promoter Score — a call center metric measuring how likely customers are to recommend your business to others.
Consider using customer data analytics to anticipate potential issues or trends.
For example, if data suggests new users find your software’s setup process complex, send out easy-to-follow guides and tutorials during onboarding.
You can also set up FAQs, knowledge bases, and AI chatbots. These resources can often resolve smaller issues before they escalate. And since they don’t require agent intervention, they free up your people’s time.
Finally, “using automation can also be very helpful,” says Edita, “especially in sending proactive notifications [and checking in] about order status updates, relevant recommendations, service errors, planned maintenance, delays, and similar issues.”
3. Train reps to resolve issues quickly
According to a HubSpot study, 60% of survey participants rank a rep’s quick response and ability to resolve issues as the top reason they keep making repeat purchases.
Consider training your agents to aim for first-call resolution. This means teaching them to solve a customer’s issue in just one interaction.
You can do this by:
- Investing in training programs that focus on both product knowledge and problem-solving skills, like using real case studies and recordings from past customer interactions to teach your agents the best ways to handle similar situations
- Giving reps the tools they need to solve problems quickly and reduce average handle time, like comprehensive guides, clear decision-making rules, and better access to experts for tricky situations
- Monitoring common pain points to identify root causes of frequent calls so reps can prepare a list of solutions in advance
- Setting up role-play exercises where reps can practice tackling these issues in a low-risk environment — consider pairing more experienced reps with junior ones so they can pass on first-hand experience and share their best customer service tips
4. Offer omnichannel support
Omnichannel customer support means connecting with your customers wherever they are, whether through phone calls, social media, email, or live chat.
This allows you to offer customers seamless, high-quality support through all channels.
It ensures that they always have a consistent and reliable way to reach you, improving customer satisfaction experience and building their loyalty to your brand.
Ideally, consider linking all channels to one support tool. This way, switching between channels is smoother for your team, and your customers don’t have to repeat the same information.
“If channels are supported separately,” says Edita, “ensure consistent branding and messaging across all platforms. [You can do this] by assigning a dedicated support agent or team to manage this aspect, or by collaborating closely with the responsible team.”
5. Create a customer feedback loop
Creating a customer feedback loop means regularly asking for and listening to what your customers have to say about their experiences.
Using this insight to make improvements to your products or services ensures you’ll continually evolve based on what your customers tell you they want.
You can gather customer feedback through touchpoints like:
- Surveys
- Emails
- Feedback forms
- Direct interviews with individual customers or focus groups
- Social media channels
- Community forums
- A dedicated space on your website for ad-hoc feedback
The exact method you use for collecting feedback depends on the nature of your work, your customers, and the kind of information you’re looking for.
“We have our contact center folks call every client a day or two after [the arborist’s visit] to ask for feedback. This ensures a good feedback loop cycle and closes each project on a good note.”
~ Kaustubh Deo, President at Blooma Tree Experts
This team found that following up through their call center yielded the best results. Your customers, on the other hand, might prefer short surveys embedded on your website or to just leave comments under your social media posts.
Whatever method you choose, make sure to let customers know that you’ve heard their feedback and are working on addressing their concerns or implementing their suggestions. This can boost their loyalty and encourage them to become repeat customers.
6. Empower your agents
According to a CallMiner survey, one in four customers decide to switch service providers because the call center advisers they interact with are inexperienced or lack the necessary knowledge to help them.
Slightly more than one in four (26.9%) people decide to switch because agents fail to respond to their problems quickly enough.
But agents that have the skills and authority to make on-the-spot decisions can solve problems more quickly and confidently, helping reduce turnover and improve satisfaction.
These decisions could include offering a discount after a shipping delay, waiving a fee, or upgrading a service.
Here are some tips to do this:
- Provide comprehensive, ongoing training, like workshops or online courses so your reps can keep improving their skills and feel more confident in their roles
- Encourage a culture of ownership so your support team members feel like they contribute to improving customer satisfaction
- Help your agents understand their customers better by giving them access to detailed customer profiles, including past purchases, preferences, and previous feedback or issues
Pro tip: Nextiva’s Call Pop instantly shows your reps a breakdown of the caller’s most important information before they pick up the phone so your people can provide better, more personalized service.
7. Choose the right contact center platform
The right contact center software brings all your customer communications together, making it easier for your reps to get a clear picture of each customer’s history and preferences.
This insight helps them anticipate potential problems and tailor their approach to each individual.
Plus, the more detailed customer information they have, the more they can personalize their service and build genuine customer relationships, increasing the number of customers you retain over time.
Retaining Your Customers Is Easier With Nextiva
Customer retention management helps you boost customer loyalty, increase CLV, reduce CAC, and provide a better CX. It also helps keep your revenue steady, as keeping your current customers is more cost-effective than acquiring new ones.
Of course, with constantly changing customer expectations and insufficient resources, maintaining high retention rates can be hard. Contact center platforms like Nextiva can make it easier for your agents.
Here’s what you get when you choose our AI-powered contact center solution:
- A unified communications dashboard so everything you need is in one place, letting you manage customer interactions more easily
- Call recordings for ongoing coaching
- Automatic call distribution functionalities to automatically direct calls to the best agent for the job
- Call analytics to view data points like talk time and abandoned calls and know where to improve
- Customer satisfaction surveys at any stage of the customer journey so you can understand their needs and sentiments in real time and keep stepping up your game
