7 Common Retention Problems and How to Solve Them

The seven most common customer retention problems are: offers that lack personalization, customers who do not feel appreciated, customers who are not satisfied with your product, customers who buy only once, a business that focuses more on new customers than on existing ones, customers who cannot reach you when they need help, and customers who do not see the value of your products. Each problem has its own fix, and this article gives you one for each.

Investing in customer retention is mandatory for every business! Unfortunately, many companies are more interested in attracting new customers than in building a strong connection with the ones they already have. They improve product quality and spend more on digital marketing. Yet new customers will not bring extra income if your relationship with existing ones is weak: the new buyers will make one-time purchases just like the existing ones, and your business will continue to stagnate.

Is retaining customers easy? No. But everything starts with proper analysis: find the reason why your current customers do not come back, then choose the best way to keep them. This article focuses on problems and their fixes. For a full list of retention tactics, read our 13 customer retention strategies for eCommerce; for the channels and metrics behind retention campaigns, read our guide to customer retention marketing. Let's go!

Why is customer retention worth fixing?

Two figures show the size of the opportunity:

• Profit. Increasing customer retention rates by 5% increases profits by 25% to 95%, according to research by Frederick Reichheld of Bain & Company, reported in Harvard Business Review (2014).
• Cost. According to Annex Cloud, building a long-term relationship with a new customer costs 16 times more.

Keeping your previous customers is the more affordable path because it does not need the same advertising spend. These benefits make retention look like a smart solution. The hard part is knowing why customers leave. For more real-world inspiration, see these customer retention brand examples.

How do you diagnose which retention problem you have?

Use this table as a quick map from symptom to fix. Each row links to a problem covered in detail below.

Behavioral segments make the diagnosis faster. Customer Intelligence in Nexus by Omniconvert groups customers into six RFM segments: Soulmates, Loyal, New, Promising, About-to-Dump and Breakups. Many New customers who never move on point to problem 4. A growing About-to-Dump segment tells you which previously active customers are declining, so you know whom to ask what went wrong. Nexus also surfaces the products that cause churn after the first order, which often points to problem 3.

Problem 1: Your offers lack personalization

You are not offering your product to everyone! Your target audience is a group of people with common characteristics, interests and concerns. You need to understand why exactly they decided to buy from your shop. Were they only curious, or did you give them a solution to a concern they have? Tracking customer behavior and patterns is how you find the reason they chose you in the first place.

There are two ways to do this part of the job:

• Talk with customers personally. Ask them to describe their expectations and concerns.
• Use website analytics. See the actions people take when they land on your website: which products grab their attention the most, how long they stay, and where they leave.

Understanding their behavior helps you customize your offers and adapt them to the requirements and expectations of existing customers. When you know what each group wants, you can show them different content with Omniconvert Explore and test which version brings them back.

Problem 2: Customers don't feel appreciated

Imagine that someone buys your product once. They like it, so they buy it again. In the meantime, they find out that another business offers the same product. Why would they buy it from you a third time? If they are curious, there is a big chance they will change their habits and try another brand.

This is the moment to react! Make your customers feel special by developing a loyalty rewards program and offering existing customers some special options. A 2020 Forbes roundup of loyalty program statistics cites two useful findings:

• Adding a loyalty program to an eCommerce platform can increase average order quantity by 319% (Incentive Solutions).
• Half of consumers say their main reason for joining a loyalty program is to earn rewards on everyday purchases.

Loyalty programs can take different forms. A points program is simple and effective at the same time:

1. Award points on every purchase

   Customers get a number of points for every product they buy, usually in proportion to the price.
2. Set a clear threshold

   After customers collect a set number of points, for example 50, they unlock a discount or a free product.
3. Remind customers of their balance

   Show points in the account area and in emails, so the next reward stays in view.

Starbucks Rewards, where members earn Stars on purchases and redeem them for free items, is a well-known example to take inspiration from. To see how loyalty and retention differ, and why you need both, read customer loyalty vs. customer retention.

Problem 3: Customers are not satisfied with your product

For you, your product is the best one on the market. You need to understand that the customer's point of view is different, so ask for feedback and find out the pros and cons of what you sell.

Reviews are one way to find out whether customers are satisfied. However, reviews do not always give you precise information. A customer can give you three stars without leaving any comment. Use surveys instead. If you have an email database of previous customers, ask questions such as:

• How satisfied were you with the product?
• What would you change about the product?
• Would you recommend this product to a friend?

Online survey tools make this easier. With the surveys in Omniconvert Explore, you can also ask on your website, on page load, on scroll, on click or on exit, and use branching logic to follow up on a low score. The last question above is the basis of Net Promoter Score; our NPS survey best practices show how to run one well.

Problem 4: Customers are interested only in a one-time purchase

Customers came to your website because you offer a product they need. Will they check out your other products? If they do not need them, probably not. This is the moment to make your offer special and more personalized, and a well-placed discount is the best way to keep their interest high.

Say you sell clothes. A person who bought a T-shirt may need a pair of jeans to complete the look. There are other places where they can buy jeans, for example a store that sells only jeans and offers a wider range. But what if you offer them a discount? When they finish the checkout, a message on your website can ask: "Do you want to check out our jeans and get a 20% discount?"

The product description and the benefits of the jeans will do the rest of the job. The customer will remember the offer, and may come back a few days later to look at the jeans. Remind them of the benefits they got from the previous product, too: that confirms your other products offer the same quality. For more ways to do this, read our cross-selling and upselling strategies.

Problem 5: You focus more on getting new customers

As mentioned above, there is no need to invest more money to attract new people when most of your current buyers make one-time purchases. Interact with the existing ones instead.

Email newsletters are an excellent way to improve the connection with your customers:

1. Give customers a reason to subscribe

   For example, offer a 10% discount on all products in exchange for a newsletter subscription.
2. Send updates and offers

   Share the latest news about your brand, new products and the offers that are relevant to each subscriber.
3. Bring them back with discounts

   Notify subscribers about current discounts and give them a reason to buy from you again.

Problem 6: Customers can't reach you when they need help

Your customers will always have questions. They may want to know more about a product, even when the description is clear. If a product arrives damaged, they will want a replacement, and you need to help them as quickly as possible. If your product requires some knowledge or skills, customers will need extra explanations.

Whatever the problem or concern, customers will usually try customer support first. When they do:

• Hire professionals. People who work in customer service need good communication skills.
• Be reachable in several places. Let buyers contact you on social media, by email, by phone and on your website.
• Use chatbots. They give fast answers to common questions and improve the customer experience.

With that level of service, customer satisfaction stays high, and there is a big chance customers will come back.

Problem 7: Customers don't see the value of your products

The amazing features of your products will probably impress customers, but they will not come back because of them. They need to clearly understand the value of what you sell.

Highlighting that value is impossible without good content marketing. Talk about the ways your product improves people's lives, so it looks like the right solution to a problem or concern they have. Our guide to marketing retention strategies shows where that content fits in your retention campaigns.

No one expects business owners to be good content writers as well. If you want to improve your skills, read books and attend content writing courses. If writing is not your talent, work with professional content writers: they know how to make content more valuable and engaging.

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