The CEO’s Guide to Customer Retention in 2018
By Anastasios Papadopoulos, IMS Founder and CEO
The competition is fierce and the stakes are high, but 2018 is the year for eager firms to seize market opportunities and achieve sustainable growth. To help you separate the key trends from the noise, we have identified three major moves for companies looking to stay ahead of the game: from adapting to the evolved sales model, to identifying the new status quo in customer experience and understanding the solutions to help you get there.
The sales funnel is dead. Long live the sales funnel!
As the year ends, so should any misconceptions about today’s sales model. The traditional sales funnel has evolved into a more nuanced, less linear journey that has customer centricity as its core. Adapting to this new sales operation process should be your primary driver for generating growth in 2018. Make friends with your marketing team and shine the spotlight on inbound marketing through content creation that is both useful and visually appealing.
A necessary step to improving customer retention in 2018 is facilitating any structural change inside your organisation to allow marketing and sales teams to work together seamlessly. It is time to stop viewing your sales department as profit-generating and your marketing department as a cost centre. Marketing is no longer the open drain for resources that it once was: digital solutions, innovative approaches and smart strategies are all transforming marketing practices in leading firms and should set the standard for the upcoming year.
Read our Insights post to understand more about the changing dynamics of the sales model.
Engagement through enriching experiences: the new status quo for 2018
Customer experience boils down to how satisfied your consumers are after interacting with your brand: and leaving them lukewarm is simply not good enough anymore. Enriching experiences foster loyalty, encourage repeat purchases, and establish (or kill off) potential brand ambassadors.
Focusing on retaining customers just makes business sense: they have already identified themselves as prospects, you have already captured their insightful data, and they are generally more cost-effective than the high Cost Per Acquisition needed for attracting new customers. Objectives in customer retention are the number one reason why companies spend so much resources in improving decision journeys and by 2020 research shows that customer experience will overtake price and product as the key brand differentiator.
We also understand customer behaviour and expectations now better than ever. We know that consumers do not always behave rationally – even when they think they do! Research shows that even for B2B consumers, the overall sales experience is 3x more important to them than they say. This means that the experience companies provide is more important than ever. Mapping decision journeys and understanding brand-consumer intersections is vital for weaving together customer-focused solutions across their decision-making journey. Make use of techniques such as personas (See our short, helpful guide for creating effective personas for a refresher) to determine the channels, medium, and pain points for your different consumers.
Delight to detain: digital solutions help solve the customer satisfaction puzzle
25% of customers will defect after a single negative experience. Companies should embrace digital as a means to reshape consumer interactions and definitively transform company culture in favour of agility, consumer-centricity, and efficiency. We are living in an era where consumers hold the power. Expectations for personalisation in marketing and interaction will only increase: now is the time to seize the opportunity for market competitiveness. Change starts within your company culture: your 2018 mission statement should capture a vision that promulgates the values you wish to communicate to current consumers and future prospects. Digital natives, such as AirBnB or Google, have long understood the significance of such a strategy, for example by circulating a set of simple principles across all company levels to ensure that the right values are reflected in all areas of work. Companies that have improved their agility significantly outperform their competitors.
Interestingly, some research has shown that today’s consumers are disloyal by nature: purchasing patterns are more shopping-driven (where consumers display strong shopping tendencies) than loyalty-driven (repeat purchases at the same brand). Delivering on experiences is crucial to influencing what step the consumer takes next: both at the moment of Discovery and Deliberation, and Post-Purchase. Different tactics should be employed depending on the stage of the journey. For example, ensuring a strong emotional connection by understanding the prospects’ lifestyle and habits will help nudge prospects to purchase during the Discovery and Deliberation phase. In contrast, a stellar post-service experience, with thoughtful follow-up by the brand which caters to additional needs, is vital for rekindling connection and ensuring a positive overall experience.