Your Customers Want You to Rate Them Back

Too many companies have inadvertently adopted a "churn-and-burn" approach to marketing. Their campaigns focus on driving leads, converting those leads, and bringing in revenue. But then the company’s engagement with the customer diminishes, only to revive when it is time for a new contract or a new sale.

No wonder many brands fail to retain their customers.

By concentrating primarily on client acquisition at the expense of client retention, companies are wasting resources. On average, companies have to spend five times as much to bring on a new client as they do to retain an existing one. Increasing customer retention rates by just 5 percent can increase profits by as much as 95 percent, according to a Bain & Company study.

So how can firms boost client retention rates? Remain engaged with each customer and ensure they are receiving ongoing value from each purchase.

Customers expect brands to not just sell them good products but check in and help them become better users of the products.

Have brands clearly explained all of a product's features? Have brands shown customers how they can use the products more effectively and efficiently to meet their needs? Until companies have these ongoing conversations with their customers, they'll keep getting dumped.

Some companies are already having these conversations with their customers. At Adobe, for example, we've started implementing what we call "adoption scoring" -- collecting data on how customers are using our products and then rating customers from 1-10 on how well they have "adopted" our Experience Cloud offerings.

Essentially, adoption scoring provides customers with digital report cards that tell them whether or not they are using our products to their full potential.

We tell our customers whether they have low, medium, or high product adoption, and list specific offerings they might be missing out on. For example, it might note that a client is "using advertising analytics to analyze paid search data" but not employing "automated personalization."

Adobe is already starting to see adoption scores improve retention rates.

Similarly, ADP, which makes human resource management software, makes sure customers are getting the most from ADP's products. ADP's DataCloud offers its customers real-time, anonymized data from the 30 million workers and 90,000 organizations in its database. The DataCloud allows firms to see how their compensation, turnover rates, and workforce demographics compare to other organizations in their industries. Firms can then adjust company HR polices accordingly. By investing in their customers' success, ADP makes itself a trusted partner, not just a one-off vendor.

Brands that sell directly to retail consumers are also starting to track product adoption. Take Microsoft's MyAnalytics feature for Office 365.

In an effort to improve work-life balance, MyAnalytics notifies users when they are sending too many emails outside of typical working hours. It can even provide a minute-by-minute breakdown of how customers spent their time in Microsoft Office in a given week.

More than 55 percent of customers say their loyalty to a given brand depends on the quality of its product. But too many brands forget that "quality" is subjective and it's the quality of the customer experience that matters most.

About 10 percent of customers who parted ways with a brand said they would not have done so had the brand simply reached out to ask about their experience. And eight in ten customers are only loyal to brands that "understand and care" about them.

Brands need to understand how customers experience and use their products, as well as provide ongoing tailored feedback to guide them to get more value from their purchase. This conversation builds trust, increases customer satisfaction, and may even open up additional product investment.

Companies can then grow their business without wasting dollars churning and burning through customers.