Your customers are the key to the continued growth and success of your business. But what’s the key to keeping your customers? According to Nadav Dakner, CEO of InboundJunction, customer empowerment is the key to great customer retention.
Dakner put together an article for Kissmetrics blog discussing the best ways to empower and ultimately retain customers. There are a lot of “growth hacks” and “get new customer tips” out there these days. New customers are undoubtedly important. But Dakner argues the more important place to devote time and resources is customer retention.
The argument for customer retention isn’t a new one – though customer empowerment as the vessel to achieve that retention might be. In either case, Dakner’s reasoning is solid.
Retention or Acquisition? The Not So “Chicken and Egg” Debate
Dakner points out that acquiring new customers can cost five times as much as retaining them. And you can’t expect to grow your business without acquiring new customers. But making sure your existing customers are happy will pay off in the long run. Dakner mentions a Belly study that says merchants estimated over 70% of their revenue (for 2015) came from loyal customers.
Seventy percent! It makes sense if you think about it.
If you have a favorite clothing brand and you’re in the market for new pants, you’ll likely check their current offerings first. If you shop there again when you need a new belt and new summer shirts – all of a sudden you’ve dropped a couple hundred dollars on this brand across several transactions.
Which brings up another of Dakner’s points…There’s a lot of lost revenue opportunity when you lose a loyal customer. You don’t just lose a customer and a single pants-buying transaction. You lose future transactions, too.
What Sends People Packing?
Different customers have different tolerance levels. But as Dakner points out, “even one negative customer experience can send people in search of your competitors.”
Some customers will leave if they catch wind of other people no longer using your service. This doesn’t have to happen on a #DeleteUber scale to hurt your business. Negative market sentiment on any scale – even that caused by customer churn – can send your customers packing.
You need to keep people feeling good about you and your offerings. This can mean everything from making sure new customers know exactly how to use your product, to sharing customer success stories with others. Both of which (here it comes!) empower your customers.
The trick to making customers stay
So how do you actually go about empowering them? According to Dakner, “Customer empowerment can’t be improvised. It must be an in-depth, planned process involving steps both before and after they become your customers.” At Epic Dog Studios, we hear what he’s saying.
We’ve had great success with an agile, iterative approach to creating in-depth video content. And to put an example to Dakner’s point – we don’t just make video for our clients simply for the sake of making video.
Instead, video becomes a tool for our clients to more effectively sell their services. That doesn’t come from guesswork and off-the-cuff ideas. It’s deliberate, intentional progress towards a planned result.
Dakner says “You must leave them with positive emotions about what your product or service can do for them, their goals, their challenges, or their quality of life.” And again, he gets it right. Very rarely do people want to hear about the technical features of your service or product. They don’t care as much about the “sleek look” of your app as they do about how it can help them save $2500 per year.
This is where animated video can really shine. It’s easy to see how controlling the tone through music, color palette, and even stylized animations can leave a powerful impression more quickly on your customers than text, for example (especially considering video consumption trends, these days).
Creating Success Stories and Then Sharing Them
Celebrating the successes of your products through mediums like video can boost empowerment with other users. If a customer saved $2500 by using your financial app, let others here about it!
First, the customers who achieve the success are doubly-empowered when they’re featured. The recognition brings positive feelings about your product and their success to both the featured customer and other customers – ”look, here’s proof I made the right decision!”
Also, it adds some accountability (similar in a way to those Facebook accountability groups that have popped up for certain online courses). If others see you as successful, what choice do you have but to continue to be successful? It is one more motivator, this desire to live up to a celebrated reputation.
It’s not hard to imagine that scenario leading to more success for that successful customer, more feelings of gratitude and appreciation from her for your products, and greater consumption of your offerings down the road.
As Dakner says, “If you can highlight and emphasize the impact your offering has on [your customers’] lives and goals, illustrating how your product has helped them get where they want to be, you will deepen the emotional connection between your customer and your product.”
Case studies, user stories, testimonials – these are some of the most powerful pieces of your selling puzzle. Consumers are smart. They’re always on the lookout for sales messages and sneaky advertisements… Let your loyal customers help you convert!
Use Video to Keep Customers From Getting Stuck in the Mud
“Customers who feel they’re stagnating with your product are going to up and leave, just to avoid the frustrating feeling of being stuck. But customers who feel they are growing and making progress toward their goals are going to hold on to that experience. Education content demonstrating how to effectively use your product can give the quagmired customers that extra guidance on how to progress.”
As Dakner points out, empowering customers involves guiding and nurturing them on the other end of the sale. Confusion on the part of the customer can lead to several detrimental outcomes: One, they return it. Even if they don’t leave a review, everyone’s time and money is wasted (or refunded). Two, they leave negative reviews around the web – we’ve all seen those “didn’t do what it said it would” reviews. Could more guidance and nurturing for the customer have prevented that?
Negative reviews and high return rates obviously signal to you that something is wrong, but it signals that to all your potential customers, too. And that’s a problem. Using video the right way, at the right time can make the difference between a raving fan and a missed opportunity.
Give Your Customers an Experience that’s Worth Holding on to
As Dakner puts it “customers who feel they are growing and making progress toward their goals are going to hold on to that experience.”
Never underestimate the power of the happy, progress-making customer. And don’t underestimate the power of sharing that customer’s story, either. Keep your customers moving through the tunnel (or funnel – *wink*) by showing them the light at the end.
Jon’s Notes:
- Has been edited for copy, needs links
- Notify Kristina Andaya <kristina.andaya@epicdogstudios.com> when posted
- Awaiting headshot/bio for who they want to be attributed for the post
The post How Video Helps Customer Empowerment and Retention Rates appeared first on Vidyard.
source http://www.vidyard.com/blog/video-helps-customer-retention/
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