In our last post, we talked about key customer satisfaction metrics every business should be tracking, but what can you do to make sure your customers are happy, satisfied, and coming back for more. Today’s consumers have a lot of choices. Just one bad experience can drive even your most loyal customers to the competition, which severely impacts customer retention.

The cost of unhappy customers

We live in what many have dubbed the ‘switching economy.’ In 2013, poor customer experiences caused more than half of consumers to switch companies they did business with. A survey by Accenture found what frustrates customers most is difficulty contacting a business, long hold times, and having to repeat their issue multiple times. These are issues that can be easily resolved but often aren’t. In fact, that same survey found that 81% of respondents said there was something the company could have done to keep them from switching.

Customers that switch don’t even have to be extremely unhappy. Even slight changes in satisfaction can lead to significant drops in loyalty. Research by CMTA found that loyalty dropped by as much as 50% when customers moved from “very satisfied” to “somewhat satisfied.” Because of this, businesses should focus on customer retention and do whatever they can to delight and make customers happy.

The secret to (customer) happiness

If unhappy customers, or even slightly satisfied customers, are leaving, what can you do to make sure they stay? The secret to creating happy customers isn’t really a secret at all. Businesses need to show customers that they are more than just a name and number in a spreadsheet. Actions speak louder than words, so here are five things you can do to show your customers you care and have an immediate impact on customer retention.

Improve Customer Retention Tip #1
Have an open line of communication

No one likes to be on hold waiting to speak with someone in customer service, and with advances in technology, they no longer have to. There are numerous live chat solutions that give customers a direct line to someone who can help them. Live chat software is a more effective tool to support your customers than phones. Instead of being able to help just one customer, your employees can now help multiple customers at once. This speeds up time to resolution and reduces overall support costs, while also keeping your customers smiling.

Improve Customer Retention Tip #2
Don’t make customers repeat themselves

In other words, listen to your customers. Nothing can be more frustrating than having to repeat yourself time and again when trying to resolve a problem. Train your staff to be respectful, maintain eye contact when in person, and restate what the customer said to lessen confusion. This will help move conversations along and mitigate frustration that can arise when customers feel like their concerns aren’t heard.

Improve Customer Retention Tip #3
Take customer feedback seriously

On a related note, if your business is collecting feedback through surveys or online reviews, you should take that feedback to heart and respond when appropriate. Online reviews are a good way to identify problems your business is having and correct them. Customers will notice if you’re listening and responding to feedback – especially negative feedback. A recent study by Bazaarvoice found that customers who saw a brand respond to a negative review were more than twice as likely to make a purchase than customers who saw a negative review, but the brand did not respond.

Improve Customer Retention Tip #4
Avoid playing hot potato

Your employees aren’t going to always have the right answer for the customer.  This doesn’t mean they should immediately look to pawn them off if they don’t. It can be very frustrating to be passed from employee to employee when trying to resolve a problem. If the employee can easily find the answer, they should stay with the customer until they do. If the issue is more complex, take down the customer’s contact information and follow up as soon as the answer is found or the problem is resolved.

Improve Customer Retention Tip #5
Be honest and transparent

Most customers will understand if something goes wrong especially if the business is willing to admit they made a mistake. Communicating honestly with customers will help foster trust and increase customer retention. Being open and honest with your customers will show that you have nothing to hide and are looking out for their best interest.


The principles that help you create happy, loyal customers aren’t rocket science. What it boils down to is following the golden rule. Treating customers the way that you would like a business to treat you. Doing so will create a tremendous amount of goodwill, but you can’t count on that goodwill lasting forever. You need to continuously look for ways to improve your business and find ways to delight your customers. If you do that, you stand a good chance of keeping customers around for the long haul.

How Podium customer retention software helps

Request a demo to see how Podium’s cloud-based solution can help you use text messages to invite all of your customers to review your business. Podium’s efficient, mobile process can help your business build a strong online presence on the sites that matter most. This will, in turn, improve local SEO and ultimately boost revenues.