Retaining Customers in the Gloomy Times of Inflation
- Posted on July 6, 2022 by Robert
- Reading time about 5 minutes
It’s the time when we are experiencing a sharp rise in pricing of everything from raw materials to end-consumer services and it’s the hardest thing to tell your customers. But, turning to reality, inflation affects most aspects of the economy and absolutely no business is immune to it.
What exactly is the inflation chart? Let’s explore the consumer perspectives and some details about customer retention during times of inflation.
Stats to Drill
Consumer prices are up by 8.5 percent. There are a few categories which are examined to be a part of this hike which basically includes food and energy. Here are some stats to prove the effects of inflation-
· Food prices rising up to 8.8 percent, while the largest increase reported was in food at home category.
· Pricing of energy grew upto 32%, while, the largest increase were in the fuel oil and gasoline categories.
· For the items apart from food and energy, the prices rose upto 6.5 percent and the largest increase was in the shelter category.
In these tough times, keeping customers happy and preventing customer churn in the constantly increasing price hikes is equally important.
Retaining Customers in Inflation
A survey by Hubspot was conducted amongst 100 consumers across the U.S, Wherein 62 percent of consumers said inflation costs have caused them to change brands in the last two years when the pandemic started off. According to the survey results there can be three different ways to increase brand loyalty even during the times of inflation, here what you need to checkout-
· Discounts & Freebies
Through a customer loyalty software in action there are options to provide customers with product discounts and freebies. For the brands who are already experiencing peaking prices, offering discounts may seem tough with excessive raw material and basic product costing. Mostly during the time of inflation, the purchasing power becomes low, and even if it is real tough for companies to offer discounts or free gifts, it is better to find some strategic options to at least contribute in consumer savings without affecting their bottom line. For instance, if as a brand your are handing out lesser promotions, at least try making it more efficient, create targeted and personalized offers for your customers based on their spending behaviors and of course there’s a lot to do.
· Getting started with a Loyalty Rewards Program
A stat reveals that 55 percent of consumers said that loyalty or rewards programs would actually motivate them in choosing one brand over another one in the times of inflation. This typically makes sense as these programs provides customers perks and rewards for making repeat purchases. So, when we talk about connecting with a loyalty solution provider and getting started with a loyalty program, it is a way of rewarding customers for their extreme loyalty towards a brand. making
customers feel valued and showing them that they’re needed is undoubtedly a great way to retain them for long and keeping them gripped with the brand as well.
· Offering Better Quality Products or Services
Product quality is never talked about but it does create a big influence on brand loyalty. In a stat we found that 55 percent of consumers are more likely to stay true to brands with high quality products and services despite of the constantly hiking prices. But, as a business owner you might have to make some compromises in the entire supply chain network, though it is essential to make sure that the product quality is not compromised in the process. Checkout ways to keep the end price down while you still meet the quality requirements. There should be an open space for your brand to experiment with pricing options, your strategy should be allowing you to segment product offerings and many different pricing points. Also, a point to remember is that customer experience should always be treated as the top factor as it is the solemn driving agent for maintaining consumer brand loyalty in the long run.
Preparing and Developing a Smart Customer Retention Strategy
Planning a customer retention strategy is another aspect to keep the customers gripped with your brand. for getting started with this, make sure you are keen on tracking consumer behavior and having a deep market analysis to understand the trends. Look for the differences why customers are skipping your brand or why there is customer churn around.
The next step here would be developing the right communication between a brand and their customers. Communication is always the key when you are wiling to retain customers, after all its your product quality and excellent services which can attract customers in the long run! Though inflation is indeed a tough time to navigate through the process but reducing the churn rate and increasing customer satisfaction can still keep you in the safest position. Understand your customers requirement and be ready to provide exactly what they’re willing to receive.
Prepare a smart retention strategy which may include various offers, promotions, and other options to attract them and keep them gripped.
Retaining customers in the tough times of inflation is not just tough but an inevitable option. We hope all the above listed tips and options provided in this article have served their purpose and have made you understand why retaining is essential. For other options, find a retail loyalty program that best suits your business requirement.