Improve Customer Loyalty & Retention

Building trust with customers is an ongoing effort. Like any relationship, it takes time and commitment. It also requires you to understand the other person’s wants, needs, and values.

If you’re looking for creative ways to improve customer loyalty, it’s fair to say you’re not only interested in generating more foot traffic to your retail store—though this is always a plus! Rather, you want to know how to generate “lifetime value” for existing and new shoppers who visit your location.

Customer Retention in Retail

No brand wants to be just another retail store or eCommerce site. Instead, you want to be a destination! One where shoppers will enjoy new experiences, try new products, and recommend you to their friends and family.

“Customer retention measures not only how successful a company is at acquiring new customers but also how successful they are at satisfying existing customers. It also increases ROI, boosts loyalty, and brings in new customers.”

Hubspot

Struggling to figure out if your retail efforts are helping you retain customers? You first need to find an effective way to measure this essential retail metric.

In doing so, you’ll be able to modify (and improve) your ongoing retention efforts to ensure they’re working together to keep your customers happy, satisfied, and coming back for more.

HOW TO MEASURE CUSTOMER RETENTION

It’s estimated that 76% of companies agree about the importance of customer retention, but only 42% of them accurately measure the lifetime value of their shoppers (SEMrush).

The simplest way to track customer retention is by first calculating the total number of shoppers you had at the end of a specific time period. This could be how many customers you had at the end of each month, each quarter, or each year.

Next, you’ll need to subtract how many of these customers were “new” vs. “returning” shoppers.

Finally, take that total number (minus the number of new shoppers) and divide it by the total number of customers you had at the beginning of the time period.

That sounds simple enough, right? Well, how can you tell if a shopper is new vs. returning? Online, this might be easier to identify, but what about in a retail-store setting?

NEW VS. RETURNING CUSTOMER DATA

Though you may be an expert at recognizing new faces, if you’re not planning to greet every person who enters your store, or be at the register 24/7, you’ll need some extra help with collecting this data.

Here are three ways you can differentiate between new vs. returning customers in your store.

  1. Ask Them: When customers arrive at checkout, they should always be greeted with a smile and some light chat. Why not add to the topic of conversation by having your staff ask “is this your first time shopping with us?” If the answer is yes, your team can instantly track this data.
  2. Introduce Customer Loyalty Programs: Maybe your retail store already offers customer loyalty benefits, such as discounts, promos, giveaways, etc.

Having a loyalty card or account attached to each customer’s email or phone number is a great way to provide extra value (and rewards) to the shopping experience—not to mention help you accurately track new and returning customers on the go.

  1. Feature Rewards for First-Time Shoppers: Another creative, and effective way to track new and returning customers is by offering first-time shopping promos. First-time shoppers may enjoy 10% off with their first purchase or maybe they’ll receive a discount, or special gift, for referring a friend.

Utilizing emails, promo codes, coupons, etc. can help you stay on track with these types of promotions, as well, to ensure you’re always entering in the most accurate data available.

Geotracking, which utilizes GPS data from customers’ smartphones, is another option you might consider. It allows you to monitor new and returning customers in your store.

How to Improve Retail Customer Retention

Now that you know how to measure customer retention, here are a few tips on how to improve customer loyalty:

  • Excellent Customer Service: it sounds a bit old-school, but the quality service and support you (and your team) offer customers is one of the top qualities they look for in a business. And the best part is it won’t cost you a thing. According to experts, approximately 70% of buying experiences are based on how customers feel about the way they were treated.
  • Personalized Experiences: We like to talk about creating experiences for customers a lot. But that’s because we know how impactful this strategy is. Customers crave new experiences. In fact, 80% of customers report that the experience a company provides is just as important as the products or services it offers.
  • Incentives & Rewards: We mentioned that loyalty cards and promotions were a great way to track customer data. They’re also an effective strategy to transform new shoppers into loyal customers. After all, who doesn’t love being rewarded for shopping?
  • Connections Beyond the Counter: Make sure you’re always utilizing other communication channels to stay connected with your customers. That means if you manage a social media page like Facebook and TikTok, or an e-newsletter platform like Mailchimp, be sure you’re regularly posting engaging content and sharing the type of news and updates your audience wants to read.

This is a great way to help them stay up-to-date on new sales, product launches, and special offers! And if customers like what they see, they’ll not only engage with your brand, but they’ll share your content with others, too.

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