How to Retain Customers: 5 Strategies That Work For Any Business

May 30, 2013 10:05 am Published by

How to retain customers? As a business owner, you’ve definitely asked yourself this question at least once. You also have probably heard the following statement more than a thousand times, but it’s worth repeating once again :

It is 6 to 7 times more expensive to acquire a new customer than it is to keep a current one (source).

Another very important statistic about the value of a loyal customer is that:

On average, a loyal customer is worth up to 10 times as much as their first purchase (source).

With a difficult economic climate, making sure that your consumers will come back, and more importantly, will buy again from you is the livelihood of your business.

More and more people are researching online before visiting your outlet, and you need to make sure to transform those visitors into happy clients.

You may have tried some tactics to improve your customer retention such as discounting your most popular items: it can definitely work if you want to compete with online retailers, but it can also have the opposite effect of destroying the value of your retail shop.

So, what are the best strategies to retain customers? The following list contains five tactics that are proven to work.

Tactic #1 : Outanding customer service

86% of consumers quit doing business with a company because of a bad customer experience (source).

How to retain customers: Starbucks employees use personal touch

Starbucks employees use personal touch to delight their customers.

There are many ways you can delight your customers when they are making a purchase in your outlet: making sure they never become part of the 86% that will never do business with you again.

You can train your staff to excel at customer service and incentivise them on the results.

You can look for more ways to make the buying experience more personal for your customers.

Why do you think Starbucks employees are asking for your name every time you order a coffee?


Tactic #2 : Listen carefully to your unhappy customers

A typical business hears about only 4% of their dissatisfied customers (source).

How to retain customers: Bill Gates suggests to listen to unhappy customers

Bill Gates: Unhappy customers are a gem.

Every dissatisfied customer who calls you, sends you an email, or enters your shop to complain is a gem that you should take care of.


Simply because it’s an occasion for you to review what works and what doesn’t in your business. As Bill Gates once stated:

Your most unhappy customers are your greatest source of learning.

Sometimes, you could be so focused on your day-to-day operations that you’re missing the obvious: a dissatisfied customer will give you a refreshing look.

Tactic #3 : Start a tribe

93% of customers identify word of mouth as the best, most reliable source about ideas and information on products and services (source).

Seth Godin, one of the most remarkable marketing authors of this century, has written a great book around creating a community for your business and how it can benefit you: Tribes: We Need You to Lead Us.

In this book, Seth Godin explains that, to be more succesful than its competitors, a business should become a leader, rather than a simple follower. Employees, customers, journalists, prospects, politicians want to follow a brand that conveys a strong and powerful message.

Think about the causes that you care about and organise events to raise money. Ask your clients to come back with ideas. Create a culture around your company and you will become a recognised brand.

How to retain customers: Tupperware's success is due to the success of their Customer Parties.

Tupperware’s achievement is due to the success of their Customer Parties.

Think about the success of Tupperware.

They are just selling plastic food containers, right?

Despite its quite boring product range, the company managed to have their containers in almost every single house in America.

How did they achieve such a result?

By creating a strong community of customers around them who turned into ambassadors. Those early fans organised “Tupperware Parties” in their neighborhood, and demonstrated to their audience the benefits of using the Tupperware products.

As a result, more than 60 years after the first “Tupperware Party”, the “boring” plastic food container business sells more than $1.2 Billion of their products each year worldwide.

Tactic #4 : Reach your audience using social media

78% of respondents said the posts by companies they follow on social media impact their purchases (source).

I’ve already discussed the benefits of social media for your business in this post, and the statistic above confirms the fact that a good social network strategy can lead to more sales, more satisfied buyers and therefore more loyal customers.

By carefully choosing which social networks are the right fit for your company, and learning to identify your buyers’ persona, you can significantly lower your customer churn.

Let’s consider that you are the marketing manager of a chain of 4 restaurants in Ireland. If you want your customers to come back regularly to your establishment, an effective action plan could be the following:

How to retain customers using a great social media presence.

An example of great social media presence: Pablo Picante.

  • Create an account on Facebook and Twitter, and fully complete your profile
  • Add those accounts to TripAdvisor, Yelp and other similar services
  • Include those links into your customer receipts and your menu
  • Publish regular pictures of your restaurant, your food, your employees
  • Engage with your audience on a regular basis by asking feedback
  • Communicate regular exclusive offers to your followers and fans

A great example of such a strategy is the Pablo Picante restaurant chain: their publications are always full of humor, they publish good-quality pictures and they interact regularly with their clients (and I’m not going to lie: I love their food as well).

Tactic #5 : Launch a loyalty program

80% of your future revenue will come from 20% of your current customers (source).

Nowadays, it seems like every retail and food service outlet have a customer loyalty program, but do customers really use those loyalty tools on a regular basis? Are they purchasing because they are part of a business club?

The answer to those two questions can easily be “Yes” as long as some basic principles are respected.

How to retain customers: a good loyalty program can fill up a restaurant.

A good loyalty program can fill up a restaurant.

You need to make it very easy for each customer to sign up: a simple paper form with a name and a mobile number to fill in is, in our experience, the most effective way to capture customer details.

You also need to explain very clearly what your customer loyalty program is about. Your customers will ask themselves “What’s in it for me?” and your job is to make sure that they fully understand the concept.

Therefore, the simpler your concept the better: your entire loyalty program has to be summarised in one sentence.

To communicate your offers to your client database, one of the most direct and effective ways is to use a bulk text messaging service.


Simply because text is on average 5 times more effective than email when it comes to contacting your customers.

Tell us about your business, what are your tactics to retain your customers ?

Image references: Featured ImageStarbucks cupBill Gates talkingTupperware party & Restaurant.
Louis Grenier

Categorised in: