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Business owners today face a tough but all-too-familiar problem. The cost of marketing is skyrocketing, and attracting new customers has become a steep uphill climb.
This means focusing on your current customers — those who already know and trust your brand — has never been more crucial. But the big question is: How do you get them to keep coming back?
The answer lies in the power of customer service. When done right, it can turn first-time buyers into repeat customers, which is a big win for your business. They’re more likely to buy again, boosting their overall value to your company. Plus, they help improve customer loyalty in the long run and cut down on the costs of finding loyal customers — both of which are key to steady growth.
In this article, I'll give you tips on how to encourage customers to keep coming to your business. I'll also define key terms, share insights on customer retention metrics, and discuss rising customer acquisition costs.
Why repeat customers are crucial for your business
Did you know that increasing customer retention rates by just 5% can boost profits by as much as 25% to 95%? Companies focusing on customer retention can be 60% more profitable than those prioritizing acquisition.
A great example is Benchmark, a digital marketing agency, that improved customer retention by using LiveChat. The proactive communication and personalized support from LiveChat helped Benchmark close sales and achieve a 90% customer satisfaction rate — showing that focusing on retention can pay off in more ways than one.
At the same time, acquiring a new customer can cost five times more than retaining an existing one. This is why it's so important to focus on repeat customers — the loyal shoppers who stick with your brand.
But what exactly are repeat customers, returning customers, and recurring customers?
Let’s clear it up.
Defining repeat, returning, and recurring customers
- Repeat customers are people who come back to buy more products or services after their initial purchase.
- Returning customers are those who haven’t shopped with you in a while but decide to come back after some time away.
- Recurring customers are your regulars — clients who buy on a consistent or subscription basis, often forming the backbone of steady, predictable revenue.
Understanding the difference between these groups is key since each one needs its own approach to keep them coming back and staying loyal.
Customer retention is the key to better metrics
Customer retention directly impacts the repeat customer rate, which measures the percentage of customers who return to make additional purchases. A higher retention rate correlates with a lower customer churn rate, ensuring fewer customers stop engaging with your business. Retaining customers fosters trust and loyalty, leading to more consistent repeat business and long-term profitability.
The trend of rising marketing costs
Focusing on customer loyalty is not just about boosting profits. It’s also a practical response to the growing cost of acquiring new customers. While keeping repeat customers is more cost-effective, the expense of bringing in new ones has skyrocketed in recent years.
In fact, costs involved in attracting customers have seen a dramatic increase, with the average loss per new customer climbing from $9 in 2013 to $29 today — a staggering 222% jump.
Let’s explore how this trend reshapes business strategies and why retention has become critical for sustainable growth.
Insights from the Lightspeed survey of business owners
A survey of business owners conducted by Lightspeed also brings some insights on this front, highlighting business owners' concerns:
Implications of rising marketing costs for businesses
The trend of escalating marketing costs leaves businesses struggling with the following:
However, don't let the statistics and survey data discourage you. The good news is that there are ways to keep your business thriving despite rising marketing costs. By using the power of customer service, you can retain existing customers and attract new ones, all while keeping your budget in check.
The power of customer service in retaining customers
The correlation between customer service and customer retention may seem obvious, but its impact can be truly profound. Exceptional customer service doesn't just create satisfaction. It creates unwavering loyalty — an invaluable asset in today's competitive business world.
The customer data survey speaks for itself:
So, it's time to pivot and focus on what counts — retention through exceptional customer service.
Strategies to encourage repeat customers
Now that we covered why customer service is so important for keeping loyal customers around, let’s dive into some easy, effective ways to level up your customer service and keep them coming back.
Deliver great customer service
Excellent customer service is more than just solving problems. It’s about creating memorable experiences that customers want to revisit. A study by HubSpot found that 93% of customers are likely to make repeat purchases from companies with excellent customer service. This means responding quickly, showing empathy, and going the extra mile.
Let's take an example of a customer reaching out with a question about a delayed delivery. Quickly addressing their concern, updating them on the status, and even offering a small discount for the inconvenience resolves the issue and builds trust.
Proactive chats are a feature that can help with that. With proactive chats, you can initiate a conversation with website visitors and offer assistance if they seem stuck or have been browsing for a while. This can increase the chances of conversion by helping customers make a purchase decision.
LiveChat simplifies this process with several key features that work seamlessly together to create a positive customer experience:
- Real-time chat: This allows your team to address customer concerns instantly. For instance, if a customer is struggling to find a product or has questions about shipping, they can get immediate answers, preventing frustration and potential cart abandonment. It also provides real-time data about website visitors, including pages visited, time spent, and interests.
- 24/7 support: By being available around the clock, you ensure that customers from different time zones or those shopping late at night always receive help when they need it. This is especially valuable for ecommerce businesses aiming to build trust and reliability.
- Ticket management: LiveChat’s ticketing system ensures that no query is left unresolved. If a concern requires follow-up or more detailed attention, it’s logged and tracked until resolved. For example, a customer inquiring about a refund can be assured their request is being handled without needing to repeat their issue.
Personalize the customer experience
Personalization can make a big difference in how customers perceive your business. 66% of customers expect companies to understand their unique needs (Salesforce). Clients feel valued and are more likely to return when they receive tailored recommendations or offers.
For instance, if a customer frequently buys outdoor gear, offering them exclusive discounts on hiking equipment or sending a personalized email with new arrivals in that category can deepen their connection with your brand. Similarly, if another customer regularly purchases coffee accessories, you might send them a notification when a new line of coffee machines or grinders becomes available, paired with a special promotion.
With LiveChat’s customer segmentation and visitor tracking, you can gather detailed insights into purchasing habits and preferences to create highly tailored interactions. For example, suppose a returning visitor has frequently viewed premium products but hasn’t made a purchase. In that case, you can trigger a proactive chat offering a special discount or free shipping to encourage conversion.
Visitor tracking lets you keep an eye on what customers are browsing in real time. If someone is comparing similar products or services, your team can jump in with helpful recommendations or answer their questions, making the shopping experience smoother.
Segmentation takes it a step further by letting you group customers based on things like location, spending habits, or purchase history. This means you can send tailored messages, like promoting a seasonal sale to customers in certain areas or offering loyalty perks to your top shoppers.
Gather and act on customer feedback
Customers want to feel like their opinions matter. As the saying goes, "A satisfied customer is the best business strategy of all." Asking for feedback and actually making changes based on what they say shows them you care. Taking steps to meet their needs proves you’re genuinely committed to keeping them satisfied.
What can you do exactly? After a purchase, you could ask repeat customers what they thought of the checkout process. If several people point out a confusing step, you can tweak it to make things smoother and keep them coming back.
Another idea is to gather feedback on your product pages — if customers often say the descriptions or images aren’t clear enough, you can update them to provide more detail and build trust. Making changes based on customer feedback shows you’re paying attention and genuinely working to improve their experience, which leaves a positive and lasting impression.
LiveChat’s post-chat surveys make it simple to capture these insights, enabling your business to identify what’s working and where there’s room for improvement. These post-chat surveys can ask customers to rate their experience or comment on how helpful they found the support they received. Such responses can highlight recurring issues, such as delays in response times or gaps in product knowledge.
Additionally, LiveChat’s feedback tools can be customized to gather specific insights, like whether a new feature or promotion was well-received. For instance, you might ask customers if they found a recently added payment option convenient, and based on their feedback, make further adjustments.
You can also analyze trends in feedback over time to spot patterns — such as growing dissatisfaction with a specific service area — and address them before they impact customer retention.
Offer timely support for ecommerce businesses
Ecommerce shoppers value convenience, and even minor frustrations can lead to abandoned carts. Shoppers might leave due to confusion over shipping costs, uncertainty about return policies, or a lack of immediate answers to their questions.
Imagine a customer who may hesitate to complete their purchase because they’re unsure about delivery times or can’t find the right size in stock. These seemingly small issues can quickly add up, leading to a significant number of lost sales. A Baymard Institute study found that 69% of online shopping carts are abandoned, often due to unanswered questions or unclear processes.
Proactive tools like LiveChat’s automated greetings or campaigns can make a big difference in keeping customers engaged and converting potential sales. For example, if a customer lingers on the checkout page, an automated message could pop up offering assistance, such as clarifying a payment method or addressing concerns about shipping costs. This proactive engagement can be the nudge they need to complete their purchase.
LiveChat can also be set up to provide real-time answers to common questions, like shipping times or return policies, which reduces frustration and builds confidence. For instance, a customer browsing a product page might receive a chat prompt that says, “Need help finding the right size? Let us guide you!” Such interactions show attentiveness and help eliminate barriers to purchase.
Another scenario: a shopper is browsing your holiday deals. With LiveChat, you can proactively highlight limited-time discounts or bundle offers, encouraging quick decisions. These timely messages reduce cart abandonment and create a smooth, enjoyable shopping experience that keeps customers coming back.
Metrics to keep track of repeat customer success
Making use of strategies to drive repeat customers is just the beginning. To truly understand how well your efforts are paying off, it’s essential to track the right metrics.
Repeat customer rate and customer retention rate
These two metrics are important for understanding how well your business keeps recurring customers.
- Repeat customer rate shows the percentage of customers who make additional purchases (repeat purchases) after their first one. This shows how effective your strategies are at encouraging customer loyalty.
- Customer retention rate measures how well your business retains customers over time. Higher rates mean your efforts to keep customers happy and engaged are working.
LiveChat makes it easy to monitor these metrics using its analytics dashboard. The dashboard tracks customer interactions and identifies trends in repeat behavior. You can also analyze peak interaction times, helping you optimize staffing and availability.
The dashboard provides average response and resolution times data, showing how quickly your team addresses inquiries — a key factor in customer satisfaction. Additionally, LiveChat allows you to segment customers based on their interaction history, helping you identify high-value repeat customers or those at risk of churning. With these insights, you can refine your strategy and focus on what’s working.
Connect with customers
LiveChat is a complete customer service platform that delights your customers and fuels your sales.
Trusted by 36,000+ companies
Customer churn rate
Churn rate tracks the percentage of customers who stop engaging with your business over a certain period. A high churn rate can signal underlying problems, such as poor customer service or unaddressed complaints.
With LiveChat’s tools, you can reduce churn by identifying pain points in real time and taking action immediately. For instance, if you notice customers frequently abandoning conversations during checkout, your team can send automated follow-up messages offering help or clarifying steps to complete the process. The chat transcripts can also reveal common issues, like unclear shipping policies or missing product details, allowing you to address these problems proactively.
Additionally, LiveChat’s analytics can highlight patterns, such as a spike in abandoned chats at certain times or topics that consistently frustrate customers. By using these insights, your team can refine processes, train staff on key concerns, and create FAQs or proactive chat prompts to resolve problems before they escalate. These proactive steps reduce churn and improve customer satisfaction.
Let's give you something to back it up.
Are you familiar with GetResponse, a top email marketing provider?
They integrated LiveChat into their support system, allowing them to handle a high volume of inquiries without sacrificing quality. By analyzing chat transcripts, they spotted common customer issues — like unclear pricing details or tricky navigation — and proactively addressed them. This approach led to reduced churn and better customer loyalty, as GetResponse users enjoyed faster, support.
Transform existing customers into loyal customers
As a business owner, prioritizing customer service isn’t just a nice extra — it’s a must.
Some ways to level up your customer service include improving the overall customer experience, making interactions more personal, and using tech tools to make support faster and easier.
Tools like LiveChat can make this process seamless by giving you the tools to genuinely connect with your customers. With features like real-time support, you can resolve issues on the spot, leaving customers impressed with your efficiency. Advanced analytics provide insights into customer behavior, helping you understand what drives repeat business.
Ready to take your customer retention strategy to the next level? Explore LiveChat today and see how it can transform your approach to retaining customers and achieving recurring purchases.
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