The business world is fraught with jargon, to the point where it is possible to get so tangled up in semantics that you completely lose sight of what is actually being said. Customer retention, in particular, is one of the areas in which a lot of blanket terminology is thrown around, so we thought we’d take this opportunity to decode some of the most frequently used terms.
CUSTOMER RETENTION
Customer retention is a set of very tactical and targeted individual customer activities and actions taken by a company or organisation to increase conversion rates, reduce customer defection, foster repeat purchase behaviour, drive cross sell and upsell to the right customers, optimise marketing spend and to ultimately grow customer life time value. Effective customer retention is indicated through a customer’s steady and continued association with your brand or company over time.
CUSTOMER LOYALTY
If you don’t have customer retention you can’t have customer loyalty. Loyalty is the result of effective customer retention programmes. True loyalty is based on a long-term emotional idea or connection with a product, service or brand. Therefore, customers may be loyal at a given point in time, but few companies can truly say that they have “loyal” customers. Harley-Davidson would be an example of a brand which has loyal customers.
CUSTOMER SATISFACTION & CUSTOMER SERVICE
While loyalty can result from customer satisfaction, it is possible for a customer to be satisfied with a product or service without being retained or becoming loyal. Customer satisfaction and good service are expected and par for the course – these factors alone are not sufficient to maximise customer value.
CUSTOMER EXPERIENCE
Customer experience is the result of all the interactions between a company and a customer over the course of their relationship. This includes every step along the customer journey (i.e. attraction, awareness, discovery, purchase, cultivation and advocacy). Customer experience is an integral part of customer retention; individuals who enjoy a positive experience when engaging with your product, service or brand are more likely to become retained, repeat customers of your business.
IT DOESN’T MATTER WHAT YOU CALL IT!
Customers these days have more power and choice than ever before. In order to retain the right customers, offer an excellent customer experience, improve customer loyalty and grow your business, you have to know your customers better than ever before.
At the end of the day, it doesn’t matter what you call it, it’s all about leveraging what you know about your customers to maximise profit and grow your business.
HOW DO I GET TO KNOW MY CUSTOMERS?
Customerlink will give your business a competitive advantage through the power of customer behavioural analytics – the quickest and most cost-effective way to understand your customers and grow your business.
We specialise in SME’s and online businesses, both B2B and B2C.
To find out more about customer behavioural analytics and boosting business growth, get in touch for an obligation-free discussion about your business needs.
