Customer Retention Strategy & Framework

Getting To Know The Customer Retention Strategy For Product Management

Author

Om Pande
March 08, 2023

Customer Retention Strategy & Framework

What is a Customer Retention Strategy?

A customer Retention Strategy means a strategy for making sure that the same customer will keep coming back to the same platform.

Most of the product-based companies in the initial stages spend more time and money trying to get new customers than coming up with creative ideas to keep their current customers interested and involved.

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In this newsletter, I am going to share a Customer Retention Strategy & Framework.

  1. Give the best “WoW“ experience to customers

  2. Give them rewards

  3. Make the upgrade/selling 1-click easy

  4. Feedback → Product Backlog

  5. Personalization is key!

  6. Easy to understand the product and process

Customer Retention Strategy

The major challenge is customer churn rate when it comes to SaaS is very high. The SaaS is developing very rapidly and hence customers have better options to look for also pricing plays an important role here.

Here is data showing: Retention rate on day 30 of mobile app installs worldwide in 3rd quarter 2022, by category

1. Give the best “WoW“ experience to customers:

  • Make the onboarding the easiest thing

  • UI & UX should be clean and breathable design

  • Make sure your customers understand what do you offer

2. Give them rewards

  • A loyalty point-based program is known to give dopamine to customers who use it!

  • Give them offers on the category they are interested in

  • referrals and rewards system are great ways to grow

3. Make the upgrade/selling 1-click easy

  • Start with a basic or Freemium Model to acquire customer

  • To upgrade/buy make it as easy as 1 click

  • Make the customer understand the feature they are buying

4. Feedback → Product Backlog

  • Negative feedback is a great way to improve

  • Search for the problem solution and scalability

  • Add them to the product backlog and maintain KPI’s

5. Personalization is key!

  • Personalize the product according to the customer, Sell them what they want

  • Ex: If someone is buying a pack of biscuits suggest they to buy milk as well

  • If the customer is only buying something frequently, Offer them a subscription to it

  • Personalize the experience for your product

6. Easy to understand the product and process

  • Make sure the customer understands your product and services correctly

  • Check how they are using it and modify it accordingly

  • Have a Wiki and FAQ for knowledgebase

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Summary:
Customer retention is key factor in scaling and growing the product. Be very practical with data and strategy. Use the framework steps and always be flexible with time and resources. Understand your priority and customers’ priority.

Glossary:

The churn rate, also known as the rate of attrition or customer churn, is the rate at which customers stop doing business with an entity. It is most commonly expressed as the percentage of service subscribers who discontinue their subscriptions within a given time period.