How to improve customer satisfaction and retention

Customer satisfaction and retention are closely connected business terms that have a significant impact on the bottom line, but each has a distinct definition.

Customer satisfaction is a measure of how happy customers are with a brand’s products and/or services.

Customer retention refers to how well a brand continuously engages customers, resulting in additional purchases or subscriptions to its products and services over a specified time frame.

It’s important to not only know these terms but also understand how they relate to your bottom line.

Customer satisfaction and retention: Connecting the dots

“Customer satisfaction and retention go hand in hand,” says Rosie Dang, customer experience manager at Y’OUR Skincare. “Ensuring customers are happy with your offering and brand interactions lays the groundwork for their loyalty and readiness to spend more money with your business.”

Carlos Castelán, managing director of The Navio Group, adds that customer retention has customer satisfaction at its core — if customers aren’t satisfied, they’re unlikely to stick around. To develop loyalty and retain customers, you need to figure out what customers like most about your business and improve that area.

For some businesses, that might mean providing speedy, convenient customer service. For others, this might mean taking a high-touch service approach to exceed clients’ expectations.

“Understanding the customer’s unique needs and ensuring they walk away satisfied from every interaction builds loyalty and fosters an environment that inspires customer referrals,” Castelán explains.

“Customers will keep coming back if their satisfaction with the experience matches their needs,” says Benjamin Goodey, marketing lead at SentiSum. As an example, he notes that Amazon has one of the highest customer retention numbers.

That’s because it’s hard not to be satisfied with the experience the brand provides — next-day delivery, availability of almost any product you want, and so on. In addition, people widely think Amazon provides unparalleled service.

“In this sense,” Goodey says, “customer satisfaction correlates very strongly with retention.”

3 tips for improving customer satisfaction and retention

1. Always over deliver

Goodey says over delivering is a great way to improve customer satisfaction and retention. Everyone hates getting conned or feeling that a company is being unfair; these are sure ways to leave customers feeling unsatisfied. The reverse is also true — you can raise customer satisfaction by tipping the scales in the customer’s favor.

“Try adding a little something special or unexpected to the customer experience,” says Goodey. For example, you could give customers a free item or service or create a value-adding community that’s tailored to their interests. Or you could introduce them to a potential prospect.

“Whatever you do, convince them that you’re not only a great brand to keep purchasing from but also an excellent partner to have,” Goodey says.

2. Focus on customer success

Customer success entails helping customers achieve their desired outcomes by using your company’s products and services. While not every organization has the budget for a full customer success team, Goodey says it’s important to have someone focus on the practice.

“Most customer success teams take the time to onboard customers, but not much else,” Goodey explains. “You have to keep checking in throughout the customer’s tenure to ensure they’re having continued success with your offering; otherwise, you’ll be facing a lot of churn within the first year.”

Make your customer success team easily accessible to the customer, including having an easy way for customers to book time with the team or ask questions. “We go so far as to have an open communication channel in Slack. That way, our customers can just ping us when they need guidance.”

3. Keep track of customer satisfaction metrics

While you can sometimes get a general feel for how happy your customers are, actual data is much more reliable. That’s why Dang says tracking metrics that gauge customer satisfaction is essential to long-term success.

For example, customer satisfaction (CSAT) is its own metric, as is the customer retention rate. “You can use these metrics, along with ones like the churn rate (the rate at which your customers stop doing business with you), to determine whether your initiatives are making customers happy,” Dang explains.

Happy customers tend to stick around longer, so it’s worth your while to improve customer satisfaction and retention. If you want to keep track of how your customers feel about your business, survey them. Jotform has hundreds of survey templates you can use to get started.

Gauge your customers’ happiness, get insightful feedback on your products and services, and use that information to make your business better.