Customer interactions allow a business to understand and address customer issues to guarantee a better experience. As a result, a brand can develop a loyal customer base that will remain with the business, thus improving its profitability and brand power. The importance of customer interaction cannot be overstated, as every small good or bad customer interaction adds to the whole customer experience. Below are 7 reasons why customer interactions matter:

Welcome back to Viewabo’s Complete Guide to Amazing Customer Interactions, Part 2 of 3. If you missed Part 1, click here to learn about customer interaction and the type of customers you may encounter. Part 2 will continue with the stages and the different types of customer interactions.

This short series of blogs is Viewabo’s Complete Guide to Amazing Customer Interactions. As we start the new year, we want to help our readers get a great kick-off to 2023. This guide can be a launching point for you and your team to redefine what customers mean to your business and develop strategies to engage customers in more meaningful ways. 

Part 1 will cover customer interactions and the different types of customers.

Regular customers come and go, but loyal ones stay. Customer loyalty measures the likelihood of a customer doing business with a brand over an extended period. The more reliable a customer is, the stronger the emotional bond and willingness to interact and make repeat purchases. 

A natural affinity and trust develop when a customer has a good experience, eventually becoming a form of loyalty. When successfully nurtured, loyal customers can be depended on to make frequent purchases, use the products they buy, and engage in more profound ways with a brand.

Customer retention is the percentage of customers who stick with a company over a specific amount of time. This is the opposite of the churn rate, which is how many people leave in a period of time. For businesses looking to navigate through difficult times, turning to keep current customers may have a bigger impact on the bottom line than finding new customers.

Other researchers found the cost of acquiring new consumers can be 5 to 25 times costlier than retaining existing customers. In addition, capturing new customers is only successful 5-20% of the time.

Everything points to higher customer retention as much easier and more profitable than focusing on new prospects.

Why should you care about Customer Lifetime Value (CLTV)?

The simple answer is profits! A Harvard Business School research report found that increasing customer retention rates by 5% increases profits by 25% to 95%. Customer retention helps businesses recoup the investment they make when acquiring customers. Anything beyond the initial purchase is extra sales at typically higher profit margins. Because there are almost no additional costs to the business, a higher CLTV equals more sales and profits.

Companies are adding a chat box or chatbot to their customer service offerings by popular demand. They are great tools to get in touch with a company and receive some personalized answers to quick questions. But text-based communication has some shortcomings and pitfalls that must be addressed within a company’s customer communication strategy.

As texting and instant messaging are so prevalent in our personal lives, it is easy to see why many customers prefer to text message a company from an app or website instead of calling or going in for an in-person visit. Just like how whole conversations with friends and family can be done from a consent stream of texts and emojis, customers now expect the same from businesses. Some customers prefer or have totally adopted text-base communications forgoing other types of communications, but is this the best for them?