Growth. It’s the one thing we’re all after. And while there are many different ways of growing a business, it seems that unhappy customers are still churning faster and more frequently than ever before. In fact, according to BI Intelligence, the reason nearly 60% of American consumers do not complete an online purchase is because of poor customer experience. This high rate of churn can be crippling to the growth of any company. So what is contributing to your churn and how can you keep a pulse on the rise and fall of customer retention rates? User feedback is your answer.
In this article, we will provide you with four user feedback tips that are certain to keep your customer retention rates up.
What is customer retention and how can feedback give it a boost?
Customer retention refers to the ability of a company to retain its customers over some specified period of time. There are a number of different strategies companies apply to maintain or boost their retention rates including an effective onboarding program, a proactive communication calendar, customer service tools, customer loyalty programs and much more.
Data from a Harvard Business School study showed that increasing customer retention by just 5% can lead to a 25-95% increase in profits.
What many companies don’t recognise, however, is that customer retention is actually closely tied to customer satisfaction. Are these customers satisfied with the service they receive? Are they happy with the usability of your website or mobile app? Are you facilitating them in a way that lets them meet their online goals? These are all insights that companies can obtain with user feedback.
Setting the Stage for Feedback
What is it that you need to be thinking about before putting feedback forms on your website or mobile app? You can start by identifying your target group and determining what you actually want to achieve with online customer feedback. Do you want to evaluate the overall user experience of your website? Do you want to see why customers are dropping off within certain funnels? Or maybe you want to measure the loyalty of your customers?
It’s important to keep these goals in mind when creating and deploying your online feedback forms. For tips on how to create feedback forms catered to your specific goals, check out this article.
4 Useful Feedback Tips to Boost Customer Retention
Here are our feedback tips:
1. Put some thought into your feedback strategy
For starters, it’s important to understand that user feedback isn’t just a feedback button on your website or mobile app. A good feedback programme requires a good strategy, which takes some time and critical thinking. Your strategy should involve knowing who you want to target for feedback, what you would like to achieve and most importantly, how you’re going to do it.
A lot of times we see companies just ‘throwing’ a feedback button on their website with no real ‘rhyme or reason’. This doesn’t necessarily scream ‘retention’, especially when the feedback form asks a visitor a question that is irrelevant to their current stage in the journey.
So decide beforehand what it is you want to achieve with your feedback.
Let’s look at an example:
Measuring customer loyalty. One of the biggest reasons why customer loyalty is critical to the success of your business is that it can help your business’ growth tremendously. Loyal customers tend to spend more on brands they like and they have a habit of spreading the news about their positive experiences with your brand to others. Not to mention, keeping track of your loyal customers can help keep retention rates up while also providing you with the means to improve your online customer experience.
A very common metric used to measure customer loyalty is Net Promoter Score (NPS). This metric shows how much your customers value your brand, products or services and how willing they are to recommend you to friends/family. With NPS, however, many companies tend to make the same mistake of asking for NPS too early in the journey.
Why doesn’t this work? A customer can only give a well-founded opinion if he/she has actual experience with a product or service from your company. If you NPS at the beginning of a sales funnel (in other words a visitor who has just been acquainted with your brand), you likely won’t get very useful or relevant feedback.
2. Get context using both qualitative and quantitative data
Want higher retention rates? Then you’re also going to need a wide variety of data that lets you measure various aspects such as customer loyalty, customer satisfaction, the usability of your website and more. The five most popular feedback metrics include Net Promoter Score (NPS), Customer Effort Score (CES), Customer Satisfaction (CSAT), Goal Completion Rate (GCR) and Smileys / Star Ratings.
So what kinds of benefits do these metrics serve up and how does this relate to retention exactly?
For starters, if you use quantitative data, it’s very easy to analyse your results as well as track progress in charts. For example, if you collect NPS, you can consistently analyse how your NPS rises or falls over time, which lets you know the level of loyalty of your customers. However useful these metrics are though, they provide very few insights if not combined with what is called qualitative data. In the feedback world, qualitative data often stems from open comment data fields in a feedback form. In other words, that section of a form where users can provide an explanation for the feedback they’re providing.
These insights are incredibly useful for identifying WHY your NPS score was rising or falling, or WHY your users gave you a low score for the quality of content in the product description. Pairing these insights with your other metrics will guide you in making the right changes to online funnels or certain pages of your website. In turn, these optimised funnels and webpages will not only help your customers meet their goals but also gain their trust!
3. Focus on funnels where customers are dropping off
Shopping cart abandonment is an issue that has been plaguing thousands of eCommerce companies for years now. In fact, nearly 74.3% of all online shopping carts are abandoned globally. So what’s happening? Where are you going wrong? Are there ways to turn this process around? Certainly – which is why we’re surprised to see that eCommerce companies are still left in a state of confusion when they realise that their abandonment rates are still up.
So here’s what you can do. Start implementing ‘exit feedback’ forms within the purchasing/checkout process. These types of feedback forms are perfect for capturing those customers before they leave the point of conversion. It gives them an easy way to explain themselves and what it is they’re struggling with. You can trigger exit feedback forms based on a number of visitor actions such as the cursor moving towards the browser. This could be either towards the ‘x’ button or the URL bar.
Collecting feedback all throughout the online journey is a good first step. However, gathering this data alone isn’t going to give you all of the answers. It is important to actually analyse this feedback – otherwise, why bother collecting it in the first place?
Analysing feedback data is beneficial in a number of ways. Not only does it put digital marketers in a better position to learn what is driving certain metrics / scores (such as NPS or CES), but it also saves a lot of time – as large sums of data can be analysed from one single dashboard and instantaneously.
Having collected your feedback and produced effective reports and dashboards for analysis, it’s time to do something about the results. This is the stage that many businesses tend to skip over. Taking action on your feedback data is so crucial as it can help build loyalty with your customers. It can also contribute to boosting conversions seeing as how you are actively correcting errors that have been reported and therefore providing a smoother online journey.
With the right action management process in place you can engage with at-risk customers immediately, and thus lessen the chances of losing them to a competitor. Note: this includes both internal actions with colleagues (e.g. alerts, emails) and external actions with the customer (e.g. using contact centre tools, CRM or ticketing tools).
Time to get those retention rates up!
I’ll go ahead and say it – losing customers is inevitable. Every company has experienced churn at some point and if they haven’t yet they will. But that doesn’t mean we can’t learn from the mistakes we make and adapt to the needs of our customers.
With a good digital feedback program in place, you can quickly and easily start implementing plans to drive improvement, enhancing both customer experience and website performance, and as a result – boost your customer retention rates!
Erin Gilliam-Haije is a Content Marketer at Mopinion and has a background in international business and digital marketing. Mopinion is an all-in-one user feedback software for all digital channels (web, mobile and email) that helps digital teams make sense out of customer feedback and turn it into real-time insights. Mopinion is now one of the fastest growing companies in the digital customer experience space.