Using UGC to Retain Customers
We all want to keep our customers. And there are some fundamental, quite basic, things we do to achieve this.
- We offer a great product or service
- We price right
- We give customers a good experience from the moment they place an order to the after-sales follow-up and continued customer service.
- We offer rewards and special offers in exchange for loyalty
And retaining customers just makes good business sense. Here are some key stats that prove this:
- If we can increase customer retention by just 5%, our profits can increase by 25 – 90%.
- Some research estimates state that it can cost up to 500% more to acquire a new customer as it does to retain an existing one.
- Marketers are more focused on new customer acquisition than they are retention.
A Missing Piece
In all of their efforts to retain existing customers – and they are important – there is one strategy that marketers forget about – using user-generated content to do part of this “lifting.”
UGC is such a common strategy for getting new customers that we rarely understand its importance in retention. But because consumers are so social and so reliant on what others have to say about a product or service, it only makes good sense to use that to keep current customers on board. Here are some key tips to doing just that.
Keep The Conversation Going
You may have a product or service line that involves multiple offerings. And you may have customers who have purchased only one or two out of that line. They are already customers, your brand is familiar, and that relationship is established. Now, you can use the content that purchasers of other products and services provided to introduce those customers to the rest of your line.
ModCloth does a great job of this, especially on social media. It continually acquires new clothing and accessory items and openly solicits photos of its customers wearing them, and then posts these on its social media accounts. Other customers are loyal followers of these accounts and are enticed to make additional purchases when they see others in them. There is a lot of conversation among customers too, and this creates an online community that continues to make recommendations and suggestions to one another.
Unique Uses for a Product
Customers are creative people. They may buy a product for a specific use and then discover additional uses for it. Information about these can motivate existing customers to buy more.
WD-40 is a company that has really capitalized on this. It sells a single product, originally as a lubricant. Over time, however, customers have come up with a myriad of different uses for the product Once the company got wind of this, it began to openly solicit content from its customers on this very topic. If you check out its website, you will find that there are some 2000+ uses of Wd-40 that have been contributed by customers for other customers.
Customer Participation in “Events” Should be Publicized
Companies have a number of types of events, ranging from special sales to support for charitable causes. Highlighting testimonials or feedback from customers who participated and getting that information out to other customers (via blog posts, social media and on the company website) can be a big motivator for additional purchases.
If a customer has taken a free trial of a new product or service, for example, a customer review that praises the item, pushed out to other customers, is a great testimonial.
A lot of companies tie purchases to donations to charitable causes (e.g., Toms Shoes). People like to feel good about contributing to a worthy cause, and when they hear from other customers about their contributions, they may be motivated to buy more and make themselves feel even better.
Making use of Review Sites
Giving customers incentives to provide reviews and testimonials on review sites can certainly generate new business, but it can also serve to keep existing customers returning for more.
Consumers want to have their purchasing decisions validated. From a psychological standpoint, they want to see themselves as smart people who make wise choices. This is one of the reasons they access review sites. And there are now such sites for almost any type of product or service. Consider Soft Water Lab, for example. Customers want to know that their own purchase has been a wise one.
Keeping the Brand “Alive”
This is perhaps one of the biggest reasons to use UGC to retain customers. It is so easy for a consumer to make a one-time purchase and then to “forget” about the brand, even if they were well-satisfied with their purchases. Customer conversation about new and/or enhanced products, about their own great customer service experiences with a product or a company, can be pushed out to customers who have not made a purchase recently and bring that brand back into their minds.
Home décor items may not be everyday purchases. But if there are customer rave reviews of items purchased, along with photos, this can get an existing customer to start thinking about what s/he might want to purchase next.
These are just 5 strategies for capitalizing on UGC in retaining and wooing back existing customers. But they do work, and marketers should think about how to incorporate them into retention efforts.