In Part One, we established that holding onto your existing customers is vital for maintaining a healthy profit margin, even if your company is rapidly adding new ones. According to Bain & Company’s research, improving customer retention by only 5% can boost an organization’s profits 25% or more. Good experiences create loyal brand advocates, who in turn bring in more customers.
But what if your organization has veered off course and retention rates are flat or sinking? Here are six simple rules to keep your customers from abandoning ship.
Rule #1: Spotlight business outcomes
An all-too-common pitfall for solution providers is trying to wow customers with the cloud’s technical stats, instead of focusing on solid business benefits. Show customers how much money they can save by moving away from on-premises solutions (including costly upgrades) toward SaaS and cloud technologies. Explain how the cloud’s agility could help bring their next product to market faster or help lower their IT costs.
If you want to build a strong relationship with clients, highlight better business outcomes rather than speeds and feeds.
Rule #2: Maintain well-timed, meaningful communication
When it comes to maintaining relationships with clients, it’s important to strike a balance. Don’t communicate enough and customers will feel abandoned. Communicate too frequently and you’ve crossed the line from attentive to annoying. Research by The 2112 Group, in conjunction with Ingram Micro Cloud and Microsoft, shows that partners who reach out on a monthly basis experience reduced churn and greater profitability.
But there’s more than frequency of communication to consider; timing and purpose are equally essential. For example, customer-satisfaction surveys don’t provide customers with valuable information. However, providing them with tips on how to leverage cloud apps is information they can use. Focus on communication that benefits your clients, and they’ll see you as a true partner: someone who has their best interests in mind.
Rule #3: Re-examine your value proposition
Just because you had something to offer customers a year ago doesn’t make you a shoo-in as a cloud-solution provider today. Take a fresh look at your value proposition. Revisiting what products and services you’re providing can help gauge whether you’re still meeting the needs of your target audience while providing an opportunity to fine-tune your message.
If your service is still relevant—and it should be—share that winning value proposition with your clientele. Reach out to say you’re happy they’re a customer and reinforce why your companies have a winning partnership.
Rule #4: Consider extending renewal periods
Although monthly contracts are commonplace across SaaS and cloud, it’s in your interests as a solutions provider to consider longer terms. Customers with a monthly contract have an opportunity to reconsider their options every 30 days. When they’re committed to you for a longer term, such as a full year, there are fewer opportunities to take the bait when a competitor comes calling with too-good-to-be-true offers.
Of course, keeping your customers happy during that time frame—long or short—is job one. Not only that, it’s the best way to reduce churn.
Rule #5: Solicit feedback
When you want to find out what your customers are thinking, skip the “brief” surveys and cookie-cutter questions. Pick up the phone and have a conversation. Get to know your clients. They’re far more likely to be candid with a trusted advisor than with an anonymous customer service representative. Find out what they like about your company and what they don’t—and why. Plus, don’t forget to follow through. Failing to act on feedback is a recipe for high customer churn.
On the flip side, it’s important to get feedback from former customers as well. Finding out why they’ve decided to walk away from the relationship can help you make improvements that prevent others from doing the same.
Rule #6: Be consistent
Customers want to have a consistent experience each time they interact with your brand because it lets them know what to expect. Of course, that experience should be defined by high quality and reliability.
One way to achieve consistency for your customers is to make sure people at every customer touch point are on the same page regarding your product offerings, pricing, service level agreements (SLAs), service and support, etc. This ensures customers get the same answers every time they make contact—no matter what communication channel they choose.
Extra credit: Evaluate your company's cloud presence
The 2112 Group Cloud Altimeter—a cloud assessment tool exclusively for Ingram Micro partners—helps you understand your cloud computing capabilities and performance relative to companies with the same profile as yours. By answering a few questions about your company and its cloud practice, the Cloud Altimeter tool will generate a comprehensive report on how your company compares to others in the same class.
See how your business stacks up in the cloud—try the 2112 Group Cloud Altimeter today.