If you have a business or if you sell online, you may have asked yourself a thousand times: “What should I do? Whom should I focus on? What is more profitable: trying to attract new customers or focusing more on the existing ones?” We’re here to tell you that both are important: no company can thrive without renewing its customer base but the top-performing ones are those who know how to make people come back time after time. After all, frequent buyers spend on average 3 times more than one-time shoppers. And it’s also way easier and cheaper to bring back an existing customer rather than to acquire a new one.

Why People Really Leave and the Importance of Customer Retention Tactics

If you’re thinking about investing more in customer retention optimization, now it’s the right time. Why? Because treating your existing customers right, you will get better conversion rates. As long as you are open to learning from the experience of your frequent buyers, you will be able to refine your marketing efforts, which will result in more qualified leads right from the start. 

Not to mention that satisfied customers are more willing to recommend your brand to their friends and family. Despite the power of marketing techniques and social media, people still trust their close ones more than anybody else, so referrals are a strong way to grow your business.

And if you ever wondered how to increase customer retention levels, here are some insights to help you start off on the right foot: only 5% of a company’s customers actively seek alternatives. Just about 14% of customers leave a business because they are dissatisfied with the quality of the products or services. The vast majority, which means around 62% of customers, choose to go over to the competition simply because they are unhappy with the treatment they received. 

Let’s face it: customer acquisition costs, as well as those for social media and Google advertising, are pretty high. So if there was something we could do to lower these costs, why wouldn’t we? Customer retention is the most profitable alternative and we want to show you how to do it effectively and efficiently. As we discussed in a previous article (Customer Retention Strategy), customer experience is the new battleground for those who are looking to increase client retention. Today we’ll be talking about the best examples of customer retention strategies and useful retention tools you can use when you start working on refining your approach.

A man sitting in a chair using a laptop.

Reveal by omniconvert.

Become a Master of Retention!

Know, predict & accelerate your customers’ moves!

60+ reviews on Shopify

Available for all platforms:

All platforms Gif

Creating a Great Customer Retention Program 

The first step of all customer retention strategies is to build a solid database tracking all the transactions and interactions between you and your customers. This will help you identify the most profitable buyers, while also allowing you to treat each customer individually and to deploy your marketing efforts accordingly. By using the right CRM (Customer Relationship Management) platform, you will be able to get more in-depth information about your customers and their purchase behavior, thus identifying relevant opportunities for improving their experience. Here are a few effective customer retention ideas you should think about:

  • Create an effective onboarding program

An onboarding program for customers is a fast and effective way to help your customers get acquainted with the products or services you are offering. Help them feel welcome, while also showing them the value of your solutions and how they can help them. If you are providing online services, assist them during the first steps of the discovery process. Explain the functionalities clearly, maybe even invite them to join your online community. Encourage them to sign up for your newsletter and offer them useful tips and tricks related to your products and services. Make communication as personal and relevant to them as possible. Consider crafting welcome emails for your new customers- this will be the basis on which you can build the relationship.

  • Create a consistent customer journey

Consistency is the key to retaining customers. People like familiar, coherent experiences. They want to know exactly what they can expect from you and they want you to meet these expectations. While the onboarding strategy sets the tone for the upcoming communications, the rest of the journey means adapting your efforts to different types of customers and different phases of the buyer’s journey. The best way to keep them engaged is to offer them the kind of information they might be interested in. Instead of having a single newsletter, you can play around with multiple templates and topics until you find the ones that your customers click best with. 

  • Build your customer relationship marketing strategy on customer insights

You may think that you have a rock-solid communication with your customers but the best way to make sure this is really the case is to take some distance and look at it from the customer’s standpoint. 

  • Do they open your emails? 
  • Do they click on the links there? 
  • Do they come back to you and read your blog? 
  • What posts do they appreciate most? 
  • Do they have questions related to your products or services? 
  • How do they want them answered? 

These are questions to reflect upon if you want to stay relevant and to the point. Building a relationship with your customers isn’t all about delivering your offers and promoting your best products- it’s about doing so in the least intrusive way possible.

  • Build a customer loyalty program

The best way to promote loyalty among your customers is to reward them along the way. Set the milestones according to your goals and KPIs and develop a loyalty program that is mutually beneficial. For example, offering discounts to customers who recommended your products or services to their peers and to the ones coming to you through referrals as well is a great way to ensure a long-term relationship with them. Gamification, bonus points they can exchange for discounts or freebies or personalized/smart discounts for different categories of customers are some other ideas you can implement.

Discounts are the most relevant reward across all generations, followed closely by free products. Consumers of all ages appreciate loyalty programs for the opportunities they offer, such as free delivery, saving money or member-only perks. For a brand, loyalty programs can open up new ways of stimulating engagement, improving customer experience and better meeting customers’ expectations.

  • Identify your “best buyers” and reward them accordingly

Remember the Pareto principle: 20% of your customers are responsible for 80% of your profits. By identifying the most active customers, you can gain precious insights on their motivation and the parts of your customer retention strategy that work best. Moreover, by getting to know them better you can offer them valuable rewards.

RFM (Recency, Frequency, Monetary Value) segmentation is a great way to identify valuable groups of customers in order to offer them special treatment. Granting them access to premium products or features, sending them bonus resources via email and checking up on them regularly, to make sure they are satisfied are just a few ways of letting them know you care about them and their happiness. Not only will they be more eager to continue doing business with you but this tactic will also increase your chances of cross- and up-selling.

If you want to discover more about your customer segments and how they really feel about your products or services, our Reveal platform is the easiest way to do it. Empower your growth team with unified customer insights and get ready to build a stronger, more receptive customer base.

Reveal by omniconvert.

Optimize your Customer Lifetime Value strategy

Get more valuable customers for a more profitable e-store.

60+ reviews on Shopify

A woman using a laptop with graphs around it.

Available for all platforms:

All platforms Gif

  • Personalize the experience as much as possible

Nowadays, we have huge amounts of data at our disposal. The way we leverage it makes the difference between a successful and a failing brand. Yes, customers are willing to pay more for a more personalized experience but they are also quick to dismiss brands that overcomplicate the buying process or that make wrong assumptions about their wants and needs. We should always work towards improving customer experience and personalization is the best starting point.

Use the data they are providing wisely in order to deliver seamless, valuable experiences. Ask for their feedback whenever possible and learn from it. You can use customer satisfaction surveys or the NPS (Net Promoter Score) to maximize the results of your customer retention program. Even if you miss an opportunity for satisfying your customers or if something goes wrong, be ready to admit it and address the situation appropriately. Customers appreciate honesty and are overwhelmingly craving proactive communication from companies they buy products and services from.

  • Use experiential marketing techniques

Experiential marketing means strengthening the bond with your customers, by focusing on consumption as a holistic experience, combining sensory, emotional, cognitive, behavioral and relational values. Think about Volkswagen’s piano staircase initiative or Coca Cola’s Move to the Beat campaign during the London 2012 Olympics: these are excellent case studies of engaging experiences that create talkability and reinforce the connection between consumers and brands. By constantly reimagining the kind of communication you can have with your customers, you lay the ground for positive, innovative experiences that will tie them to your brand indefinitely.

  • Notice the “warning” signs and act on them 

Customers are letting you know that they are considering switching brands in the most subtle ways. If you identify customers that used to buy from you who haven’t made a purchase in the last 6 months, let’s say, you can find ways to get back to them and encourage them to reconsider their option. You can send out follow-up emails to find the reasons behind their decisions and find the appropriate strategy for retaining them. 

Maybe a special offer that is particularly interesting to them or an extra discount will make them come back to you. More often than not, simply listening to them and showing them that you value them as customers will take you a long way. Personalization and convenience are great ways to stay top of mind, as long as these efforts are data-driven and directly relevant to your buyers. 

5 Ways to Improve Customer Retention 

Now that you know what you have to do in the first place, let’s take a closer look at what you can do to refine your strategy as you go. Here are a few customer retention techniques worth considering if you want to step up your game:

  • Understand exactly why your customers leave

Whenever your customers decide to leave, consider writing a personal email asking them what made them make that decision. Another good idea is to scatter some feedback questionnaires here and there along their way, asking them how likely they are to recommend your brand to their friends, as well as a few questions about the perceived strengths and weaknesses of your brand. Staying in touch with your clients will help you grow healthily, while also providing you with useful, actionable insights.

  • Use the insights to improve both the customer experience

Don’t ask for reviews or feedback just for the sake of asking. Take them seriously and act on them. Keep track of all the information you receive by adding them into knowledge bases- you never know when they may come in handy. Work on specific parts of your business that have the potential to increase customer retention rates, keep on improving your communication efforts and always look for ways to strengthen the bond with your clients. The onboarding process and customer service are the new equivalents to your business cards: people love being treated with respect and consideration and they also value promptness when it comes to satisfying their needs or curiosities. Time is the most valuable currency, so pay close attention to convenience and accessibility while designing the whole customer experience.

  • Create a positive user experience

There are 4 major points you should focus on when building the user experience: integration, innovation, interaction and intuition. We talked about this before but it’s worth discussing them briefly again. Integration refers to the consistency of the whole experience, to the way you harmonize all the elements, while also staying true to your brand’s personality. Innovation speaks for itself: you need to be aware of the emerging trends within your industry and ready to accommodate them. Interaction is all about the way that your customers use your website, how easy it is for them to find what they are looking for, how fast they can place an order, how clear the map of the website is to them. Finally, intuition is about creating easy, personalized designs that take into account your buyers’ digital behavior and answer to their needs.

  • Build a community around your products or services

Never underestimate the sense of belonging. If you want to improve customer retention, think about the ways you can make them feel like they are a part of something greater and bigger. Find the platforms your clients are most active on and help them connect with your brand and other customers around there. Share valuable content with them, create discussions around various topics, allow them to discover more about your brand and your values. You can also make your customers feel valuable through different causes that the business covers. 

  • Add a personal touch to everything you do

As technology and digital behaviors evolve, people are craving human interaction more than ever before. Leverage this opportunity to improve customer retention: add personalized thank you notes to the packages you deliver, throw in a little extra something every once in a while, set a familiar tone for your communications and check up on your clients regularly. You know what they say- out of sight is out of mind. If you want them to keep coming back to you, you need to give them a reason to do so, a reason to keep thinking about you.

Customer Loyalty Programs

This has become synonymous with customer loyalty programs. So let’s take a look at how different such strategies can specifically help improve customer retention for your business:

  • Inspire with a mission

While it’s not a loyalty program per se, having a mission or supporting a certain value through what you do can have a great impact on your customers. TOMS is doing just that: their slogan is “Stand for tomorrow” and they started off with the “One for One” program, where they donated a pair of shoes for those in need for every pair of shoes their customers bought. Today, they do a lot more than that: they donate a third of their profit to various charities, in support of causes such as mental health awareness, physical safety or equality of opportunity. 

If you know that your audience is sensitive when it comes to social initiatives, and if the kind of business you’re into allows it- you should definitely consider this option. Take for example, Wholesome Culture, a US-based company which is selling sustainable clothing and donates 10% to protect bees that are facing extinction. They are always communicating how their products help the environment and give people that sense of value. People want to have an impact on others and they appreciate meaningful actions, so this might be an effective way to build trust and turn them into regular buyers.

  • Gamified loyalty programs

Gamification equals higher participation, essentially because makes things so fun and easy. Nike’s premium program, NikePlus, offers members special rewards for their birthday, as well as event invites and VIP exclusives. They have also launched a treasure hunt among members to discover new design ideas. A similar strategy is used by Domino’s, who offers members the chance to play the games, receive points and get free pizza for them. Other businesses offer customers a “spin the wheel” game every time they visit their website, where different discounts, free shipping or free products. Gamification can also be used in combination with a referral program, to incentivize social shares and turn customers into brand advocates: if they get closer to a prize they find valuable with every like, share or recommendation, they will be more eager to get in the game and win that reward.

  • Premium memberships

Amazon Prime is perhaps the most successful case study. In 2019, there were about 105 million Prime members registered only in the US. For a monthly fee of $12.99, Prime members have access to a plethora of shopping and entertainment experiences, such as exclusive deals tailored to the customer, free 2-hour delivery on groceries, an ever-growing e-book library and numerous original productions on their video streaming platforms. If you can combine various services or experiences that can male your customers’ day-to-day lives easier, that’s the way to go. Their loyalty will follow. More than that, you will get to see an increase in the value of each customer purchase. 

  • Freemium services

An innovative way to create loyal customers is to give them a taste of what you can offer and make your service indispensable. It is exactly what Spotify does. The free membership has limited functionalities. For example, you can’t skip as many songs as you like, you have to shuffle through an entire album without the option to play a specific song and you can’t download your saved songs for later when you’re offline. 

Premium membership, on the other hand, offers listeners full control over what and when they want to hear. Registered users can always sign up for a 30-days premium trial version and see for themselves just how good the service is. Plus, the price plan is pretty affordable. This is how they achieved a 46% conversion rate. Once premium members get accustomed to the service, it quickly becomes a part of their everyday rituals, and this automatically makes them less inclined to give up on using it. 

To further improve retention, you can use a tool like this to create a membership website that offers a user-friendly interface to manage all your memberships in one place.

  • Smart discounts 

If the premium membership is not a viable option for you, smart discounts may be the right call, as they can apply to almost any industry. Based on the data your customers share with you, you can personalize offers in order to remain relevant and solve some of their specific problems. By knowing their buying patterns, you can offer deals that might interest them personally. 

For example, if you are an online retailer and you know that some of your consumers buy more household products than anything else, it might be irrelevant to target them with offers for cosmetics or accessories. Instead, offer them coupons for the things they usually buy- they will be more valuable and more likely to be used. Moreover, customers will notice that you understand them and they will know you’re the best option out there. In time, they will get to trust you more and diversify their purchases.

You can use these smart discounts for different holidays or special events happening where your customers live as well. The most important thing is to shy away from that universal approach, towards a more customer-focused one. With most eCommerce businesses always using the same discount strategy for the same range of products, you can differentiate yourself by being meaningful and relevant to your clients.

Drive meaningful change in your ecommerce

Monitor & improve what matters.

80+ reviews on Shopify

Available for all platforms:

All platforms Gif


Personalization and customer-centricity are the key elements that are going to help you boost your retention rates and keep your buyers close for as long as possible. Fostering personal connection, nurturing the relationships with your customers and helping them feel like they are more than just numbers in a database or merely targets for your tireless marketing efforts will put you on the right track. 

As long as you focus on your clients, customer expectations and wellbeing, you can never fail and loyalty will ensue. Discounts and fidelity points, although significant, are just a part of the big picture. Perpetually delighting and engaging customers is much more important in a landscape dominated by the quality of the overall experience.

Frequently asked questions

1. How can customer retention be improved?

Understanding your customer base is essential in finding how customer retention can be improved. Discover why customers leave and use insights to improve customer experience. Use customer insights to create a positive user experience that has the power to form a community around your products/ services. Add a human and personal touch to every interaction your customers have with your brand.

2. How can customer loyalty be improved?

Customer loyalty can be improved when you have a deep understanding of the shared values and what is perceived as valuable by your customers. People stick with a brand because they are inspired by its mission, so remind them how your relationship makes this world a better place. Increase customer engagement with gamified loyalty programs, premium memberships, freemium services and smart discounts. 

3. How do you keep a customer from leaving?

A customer-centric mindset and personalized experiences help you keep a customer from leaving. Customers want to feel special so you need to create a personal connection between them and your brand. To improve customer retention rate, you need to design a program starting from the characteristics of your customer segments and to transform everything you know about them into marketing efforts that are most likely to boost customer retention.

4. How do you develop a customer retention program?

To develop an effective customer retention program you need to track all of the transactions, interactions and customers’ behavior. Then you can start building a custom retention program, including tactics like creating an effective onboarding program; creating a consistent customer journey; building your customer relationship marketing strategy on customers feedback; building a customer loyalty program; identifying your “best buyers” and rewarding them accordingly; personalizing the experience as much as possible; using experiential marketing techniques to boost sales; noticing the “warning” signs and act on them.