At the idea stage, most founders are focused on building a product that customers find interesting enough to try. Understandably, why would we worry about retaining customers if we still haven’t proven that the product is valuable enough to attract a customer in the first place?
The truth is, proving that the product can provide consistent value to the customer is as important as attracting the customer. After all, a product that seems useless after the first try clearly lacks validation. This is a common situation where marketing and promise are enticing, but the product doesn’t meet customer expectations.
Retention is built around data. You need data to understand where the product falls short and the customer loses interest. If you’re launching a new startup product, you don’t have data. But what you can do is analyze your competitors’ products and speak with their customers to map their journey and understand what keeps them using those products or why they decided to look for another solution.
Here are three customer retention tips that will help you launch a product designed to attract and keep the customer.
1. Accelerate Value Addition By Reducing Friction
Churn is the opposite of retention. It is when a customer closes an account or cancels a subscription. There are many reasons that cause churn for new customers. Here are two of the biggest reasons that you can easily be prepared for.
If a customer is using an alternative solution, they have standards and a limit. If they considered trying your product, it means you did a great job of selling the benefits gained from taking the time to switch to and use your product. Your job is to prove to them that they made the right decision.
The last thing you want to do is make it hard for them to gain the expected value. Accelerate value addition by reducing friction, whether it is during registration or onboarding. Help them experience the solution as fast as possible. Once they experience the value, they won’t mind taking the time to meet your requirements. A free trial alone is not the answer. Most of the time, it’s not a question of money. It’s whether the product solves the problem uniquely well.
Another common reason why customers churn soon after registration is overpromising. You have a vision and ambition about how you see your product delivering an outstanding experience, but this doesn’t mean you are there yet. Be honest about your solution, even if it is in its most basic form.
It is much harder to convince a customer to give you another try if they once eliminated your product from their pool of options. In any case, in the beginning, most likely you will attract the innovators and early adopters who don’t mind using new solutions. Being honest doesn’t only pertain to the product and its functionality. It also means sharing the story and vision. Your customers will connect with your story and will want to be a part of the journey.
2. Keep Your Customers Busy
Engaged customers stick with the product for longer. Customer engagement happens at two levels: product and marketing. Marketing-specific engagement includes initiatives like frequently sharing educational content, providing exceptional customer support, involving the customers in your product roadmaps and marketing.
Product-specific engagement is most importantly about creating a product that solves a problem and provides consistent value. Second, it’s about understanding how your customers interact with the product by answering, what keeps them excited and why they come back? When do they experience the Aha! moment?
The Aha! moment is usually experienced when a customer accomplishes what they used the product for. For Amazon users, it’s when you order and receive a package. Personally, it was when I realized I could order anything I will ever need. For Facebook, it’s when you connect with your first friend.
Once you figure out your Aha! moment, naturally, you want your customers to experience this moment as often as possible. This is when you start examining user behavior to find the point at which your customers get hooked with the product. For Facebook, it is a user connecting with seven friends within ten days.
3. Personalize User Experience
According to an Epsilon survey, 80% of respondents are more likely to buy from a company that offers a personalized experience. Those respondents make more than fifteen transactions per year, shop three times more and are considered brand ambassadors.
Especially in the early days, personalizing onboarding and product experience, even with as simple as a dedicated account manager or salesperson, can not only boost sales but also, it’s an opportunity to listen to customers’ needs and expectations, which will play a key role in understanding what your solution lacks and how it can be improved.