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Busted: 5 Myths about Customer Retention Rate

Goes without saying, customer retention is an important aspect of the success of any organization. You might as well be aware that retention of the customers not only leads to overall cost savings of the company but also contributes radically to the profitability, productivity as well as the enhancement of the staff morale of a company. Research claims that 78% of the global business leaders rank customer retention rate as a crucial tool in the upliftment of any given business.  

Much to the contradiction, what wails is that in spite of this the employee leaving jobs is on the rise. This is when the game of customer retention strategies come into play. And if you haven’t yet crafted the ideas, maybe now is the right time to begin.

customer retention rate

As Maurice Franks aptly puts it, 

“Loyalty cannot be blueprinted. It cannot be produced on an assembly line. In fact, it cannot be manufactured at all, for its origin is the human heart-the center of self-respect and human dignity. It is a force which leaps into being only when conditions are exactly right for it-and it is a force very sensitive to betrayal.”  

 Here are 5 such myths about customer retention rate and ways to truly understand the reason behind it.  

Myth 1: Refrain from investing more in employees as it will lead to increased turnover.  

Busted: As a matter of fact, not investing in adequate amounts, nudges them to quit.  

There is often a perception out there that investing more in your employees, be it in terms of any educational workshop or training and development, will hone their skills and with that, they will switch to a better pay scale.  

While the reality is employees will leave for greener pastures whenever they feel is the right time. For this, you must put on a creative thinking hat and ponder on ways to invest smarter. Else, send them to partake in competitive trade shows or you may wish to hire a motivational speaker in the least.  

In addition to that, always put up weekly or monthly meetings where the employees and discuss ideas and suggestions for improvement.  

Myth 2: A small scale business will lose to a large scale business. 

Busted: Small businesses have a competitive edge from the very beginning. 

People believe that larger companies offer larger perks, larger benefits, and greater salaries. In reality, if you are part of a smaller organization, you have the bigger potential to retain customers. For this, the answer lies within you.  

Understand your employees. Ponder over smaller segments like is the working hour flexible enough, is the work environment relaxed? Can you produce health and development programs or just in short what is your unique selling point? What is the key which sets you apart from the rest?  

Do not hover on the fact that since it is a small industry, it is susceptible to collapse easily. Rather, delve into ways where this petite size brings you massive leverage.  

Myth 3: It begins and ends with the Buyer’s Journey 

Busted: It is now more about the adoption journey from an employee’s point of view. 

Yes, now you can see there is a sudden change in the dictionary of business, especially when it comes to customer retention rate management. Gone are the days when it was all about the buyer’s journey.

Now the journey mostly accounts for the rate of adoption and how well has the employee adopted the changes.  

This journey has covered the ground after the consumer has initiated a purchase and improved retention through customer success.  

The core question is how to mix success with functionality to create delight. Understand the customer and the product used to achieve their goals. This will eventually drive in a long and healthy relationship in the given process.  

Myth 4: Self Service and Customer Success have different routes  

Busted: Both Self Service and Customer Success makes a beautiful team.  

As a matter of fact, you will soon see how the merge of Artificial Intelligence with Customer Success will give rise to an increase in automation. It is seen that smarter chat boxes run by robots, equipped with machine learning solve customer-related problems more than ever. 

Nonetheless, they can also help prioritize conversations with the customers, funneling those who directly need a customer success agent to the right source almost in a couple of minutes.  

If this isn’t a win for the business, well then what is?  

Myth 5: Recruitment and Retention do not go hand in hand.  

Busted: Statistically proven, the first step of retention is recruitment.  

Reality states that both these terms are interconnected. The circle is simple. Hiring the right personnel helps improve customer retention rate. This paves the way to the fact that you are a good company to work for and that it attracts top talent.  

On the contrary, if you hire the unfit personnel, there arise high chances that you will get higher employee turnover. It can be agreed that the recruitment should be done on the basis of skill set, but I beg to differ. Yes, it is vital but only a part of it. Fit, personality and understanding of the audience are important facets that need to be dealt with while hiring candidates.  

You can set up group interviews, and judge how well they interact within their group, their leadership and speaking skills.  

Better yet, schedule a series of interviews. All of which can test different attributes of the candidate and finalize you with the best fit from the lot.  

Final Take  

While implementation retention strategies is always needed, it is pertinent to truly understand what does the employee like most of your company and what are the factors that can nudge him to switch. Place yourself from the position of your employee and the answers will automatically start unraveling.  

With the given myths, you will be assured to get to the root of the issues which generally arise in any business affair. Have clarity in your thoughts, discuss with your customers, and climb the ladder of customer success in no time.  

Good Luck! 

Love and Light! 

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