With so much content available on customer retention and reducing churn, how do you know which strategies truly make an impact?

To answer this, we’ve sourced customer retention strategies from 18 leading companies across different industries. Buckle up as we explore each of them in detail.

You probably already know what customer retention is or what a good retention rate is (if you don’t, head over to the FAQs at the end), so let’s get right to the 18 retention strategies I hand-picked for you.

Usability and preference testing lets you identify user needs and uncover UX issues that might derail your product’s success.

For example, Beable ran Userpilot surveys to collect user preference data when working on its product re-design and used the insights to inform its product roadmap.

How can you satisfy user needs if you don’t know who they are or what they want to achieve?

ClearCalcs, a structural analysis platform for engineers and a Userpilot customer, uses welcome surveys to collect information about new sign-ups: their roles and objectives. So that they can tailor their onboarding experience and inform future product development.

Customer journey personalization makes the customer experience relevant. It’s like a tailored dress, made to measure for a perfect fit.

Once the user chooses their role, Canva personalizes their dashboard with shortcuts to templates they will find most relevant.

Ever wondered what makes computer games addictive? They’re designed to stimulate the brain’s reward system. This leads to dopamine release and creates a sense of pleasure and achievement.

G.G. helps its users get to know the product through checklists, product tours, live chat, and self-serve resources.

Celebrating important milestones can also give users a dopamine shot. Consequently, it drives repeated use, which is necessary for product adoption and long-term retention.

It features a badge and a congratulatory message to stimulate the reward system. But it doesn’t stop there: it contains two CTAs encouraging users to share this post and create new ones. This further reinforces the desired behavior.

User preferences aren’t set in stone: they keep changing along with the market demands, trends, and new technological developments. So the fact that you assessed them accurately during the initial discovery doesn’t mean they’re still true.

Users can find this short feedback form in the resource center, available whenever they feel the need to submit feedback or a request.

Customer feedback works best with product analytics. That’s how you can find which users experience friction in their product journey and where. And then follow up with them to get to the root cause.

That’s what Leyre Iniguez, Customer Experience Lead at Cuvama, did to optimize the user journey for their customers. Userpilot’s path analysis helped her spot an issue (an error message). She then segmented the users who experienced it and contacted them to investigate the details.

Software localization increases user engagement and retention.

That’s why RecruitNow, a Dutch ATS company catering to the German and Austrian markets, uses Userpilot’s localization feature to translate its resources and surveys for its target audience.

Inactive users are difficult to reengage because you can’t nudge them with a cheeky tooltip or a modal when they don’t log in.

When it comes to customer support, you have two options. Respond to issues when they arise or anticipate them and nip them in the bud before they escalate.

And use the insights to provide in-app self-serve support through resource centers with tutorials and guides, as Talana did.

New features, be they newly released ones or new to the user, keep them engaged and increase retention.

Here’s an example of a modal announcing the addition of bulleted and numbered lists. It highlights the key benefits and includes 2 CTA buttons. One prompts the user to try the feature and the other to view additional support resources.

There’s another reason to help users discover new features: to make them upgrade to a higher plan.

What makes the strategy powerful is its contextuality. The modal appears when the user experiences the pain. That’s when they are most receptive.

A strong community around your product has multiple benefits. Members support each other, exchange resources, and share success stories. This inspires others, allows them to fully realize the product’s potential, and gives them a sense of belonging.

Check out Notion’s community and Ambassador program, which includes groups, resources, events, and certification programs.

Integrations are another way to create a moat. Once the user sets up their perfect workflow around your tool, they will be reluctant to experiment with alternatives. Switching takes time and effort, after all, and they could be spending it on value-added tasks instead.

Slack realized this a while ago, and now it offers dozens of integrations with leading applications like Asana, Workday, and Figma, so that users can sync their data seamlessly and streamline their processes.

Loyalty programs motivate customers to stay with the company by offering them exclusive benefits, like tiered rewards, early access to new features, or exclusive access to perks.

This translates into greater customer satisfaction. And remember, satisfied customers are loyal customers.

Customer loyalty programs are often combined with advocacy schemes: they reward customers for recommending the product to their friends or colleagues who become customers.

Apple encourages users to share photos taken on their iPhones. The company rewards the most creative photos by featuring them on Apple digital platforms and in marketing resources, like their billboards, and crediting their work. This gives the winners global exposure and a licensing fee.

Customer education improves their competence and helps them realize the full product value. This makes them more successful and, consequently, more satisfied.

Such events not only educate but also foster a sense of community among customers, which improves retention.

To optimize your customer retention strategy, conduct A/B tests. That’s when you run two versions of your in-app flow, UI, or resource at the same time and compare their performance.

However, after running the two versions in parallel, it turned out that the change led to a 25% drop in clicks.

Userpilot offers a number of tools that you can lean into to improve customer retention.

To start with, there are the UI patterns. You can use them to create in-app experiences to onboard new users, announce new features, drive account expansion, and communicate all the important things that they need to know.

There are also powerful analytics that let you track user behavior in-app, analyze it in detail, and track key metrics and trends from custom dashboards.

To gather qualitative data, use the in-app surveys. You can send them to specific user segments and at a specific time. Or trigger them contextually when the user completes an action, for example, to measure the success of new features.

Finally, there’s the resource center where you can provide self-service materials, like how-to guides or video tutorials. So that users can solve their problems without your help.

So you get engagement, feedback, and analytics features under one hood. And our customers love it.

Before we check out, let’s answer a few of the frequently asked questions about customer retention.

Customer retention is your ability to keep your existing customers. In retail, it’s about making them come back and buy more, and in SaaS—keep using your product and renew subscription fees.

The ability to retain customers is essential for sustainable growth. It’s difficult to imagine growing your customer base while constantly losing existing customers.

Customer retention has an impact on your revenue. That’s because loyal customers have a bigger customer lifetime value. They spend money for longer and are more likely to upgrade to higher plans.

To calculate the retention rate, deduct the number of new customers from the total number of customers at the end of a period and divide it by the number of customers at the beginning of that period.

So if you had 100 users at the beginning of the month, acquired 23, and ended the month with 111, your retention rate is 88%=((111-23)/100).

According to Userpilot’s SaaS Product Success Metrics Benchmark Report, the average 1-month retention rate in SaaS is 46.9%. However, what constitutes a good retention rate depends on your vertical.

For example, the fintech companies in the study had a retention rate of 57.6%, while healthcare companies had only 34.5%

It also depends on your customer size. The 2020 SaaS Retention Benchmarks for B2B Companies report by SaaS Capital found that companies with the largest annual contract value also had the largest median retention rate. So, companies catering to enterprise customers will have higher retention rates.

The 18 examples of retention strategies illustrate how you can use different tactics to build a satisfied and loyal customer base and reduce churn, which is essential for growth.

If you’d like to learn more about Userpilot and how it can help you enhance your customer retention initiatives, book the demo!

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