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CUSTOMER RETENTION FOR NIGERIA SMALL SCALE BUSINESSES

CUSTOMER RETENTION FOR NIGERIA SMALL SCALE BUSINESSES

Peter Drucker once said, the purpose of a business is to make profit and keep customer. Customer retention deals with the latter. Customer retention is a vital fold in small scale business due to the competitiveness of the market be it product or service. Customer retention refers to series of activities and actions firms and organization take to reduce the number of customer defections.

The primary goal of an ideal entrepreneur is to retain its paying customers. This can be carried out mainly through customer loyalty and brand loyalty initiatives.

Out rightly, the first contact a customer has with your organization/brand may continue throughout the life time relationship, as the sayings “first impression lasts longer”.

 

WHY CUSTOMER RETENTION IS IMPORTANT

Adding new customers to your business is quite pleasing, but not retaining the existing ones can be disastrous to your business. It is easy to convince an existing customer to purchase/subscribe for additional unit of your product or service based on the existing interest making it simply to capitalize on their experience with your organization.

According to research, selling/providing service to a customer you already have relationship with is often more effective to grow your revenue because advertisement does not necessarily attract them. This makes customer retention faster and on average cost up to seven times less than customer acquisition.

Customer retention is a more sustainable business model that is key to sustainable growth. It generates a sequential progression. Through a loyal customer, you can generate a chain of customer without stressing to advertise your brand. The experience a loyal customer has with your brand serves as testimonies to catch more customers and increase your revenue.

 

HOW TO INCREASE RETENTION

Note that your competitors can go extra miles to convince your paying customers to shift ground; the following tips can help save your customers from defecting.

1.      SET YOUR CUSTOMER EXPECTATIONS: Put yourself in the shoes of your customers, the set an early expectation higher than what they can request. This will help you eliminate disappointment in their expectation.

2.      BE PROMPT IN YOUR DELIVERY OF SERVICE OR PACKAGING: Try as much as possible to keep your promises when it comes to delivery of services, never promise what you cannot fulfill. This is common among sole proprietor entrepreneurs. It is quite better to be factual about your service than known for failing promises. Integrity is a brand loyalty that buys your customer loyalty.

3.      USE YOUR RELATIONSHIP TO BUILD TRUST: Let your relationship with your customer or client build a strong trust and you will be surprise to see how marketable they will be for you. It will also make you valuable that they can trust other activities with you.

4.      TAKE PROACTIVE APPROACH TO CUSTOMER SERVICE: Customer service is very important, never give a slack to apologies on slight complains of your product/ service, then go extra miles in making up if possible to save future occurrence. Learn also to request for feedbacks thereafter.

5.      USE SOCIAL MEDIA: Make your loyal customers brand ambassadors of your product/service without obliging them to. This can be done through several measures. (Contact me via email for further details).

6.      KNOW YOUR CUSTOMERS AND GO EXTRA MILES: Being observed that many Nigeria entrepreneurs careless about having a database for their customers, this is quite disastrous as it does not even help to discover increase or decrease of your clients as one goes and another leaves. Having a precise data will help you communicate them time to time. Monthly/ seasonal messages can be sent to make your brand intact in their hearts. You can also advertise a new brand or service of yours using same message. E.g For this season, Unique Fabric Care has decided to offer you 30% discount of every 10 clothes dry-cleaned.

7.      REWARD YOUR LOYAL ADVOCATE CUSTOMERS: Customers who are brand ambassadors should be rewarded with some coupon. This will motivate them to do better.

8.      MAKE SURE YOUR EMPLOYESS CAN EXPLAIN YOUR PRODUCTS BETTER: Remember, the first contact with your product goes a long way, it is best for you to train your employees to market your product/ services well in your absence. Ensuring that your employees are skilled enough to attend to customer is vital. This will help paint a beautiful picture of your organization in a new face.

 

How to Know if your Company is Getting Better in Retention.

 

RETENTION RATE= CE-CN x 100

                                            CS

 

CE= number of customer at end of period

CN= number of new customer acquired during the period

CS= number of customers at start of period

 

YOUR RESULT HERE INDICATES IF YOU ARE DOING WELL OR NOT!

  • By InnovateNG
  • 2018-11-16


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