Just about every business owner has heard how increasing their customer retention rate by 5% can subsequently increase their revenue by anywhere from 25% to 95%.
Unsurprisingly, customer satisfaction is a key driver of retention. Customer satisfaction is influenced by many factors, such as your business’ accessibility and convenience, your response time, the quality of your products and services, pricing options and more.
Often overlooked in this area, however, is the importance of educating your customers. By educating your customer on topics relevant to your niche, you can better demonstrate the value of your products or services and create happy, lifelong customers.
The Value Of Customer Education
Customer education initiatives are a key element of building a more meaningful relationship with your target audience. These education efforts often focus on how customers can make better use of your products and services, though they also frequently incorporate tips and guidance on other topics related to the company’s core services.
In today’s marketing environment, this is often seen in the form of blog posts or resource libraries. For example, the publishing platform Ingram Spark offers extensive educational resources to authors wishing to use its services, including resources specific to using its platform as well as courses and blog posts covering more general guidance for publishing-related topics.
Such education initiatives have a direct impact on customer retention. A study by Forrester Consulting found that implementing customer education programs improves retention by 7.4%, with 90% of companies seeing a positive return on these investments.
These retention improvements were largely derived from the fact that programs “meant to educate customers on how to best utilize a company’s products and services, both pre- and post-purchase […] promote greater customer success and satisfaction with their purchase.” When a customer feels confident in using the product or service thanks to a quality education program, they are much more likely to feel like they achieved the desired result of using your business.
Such efforts can simultaneously increase your product adoption rate as customers feel like they understand the benefits of your product and how to use it, while also decreasing your need for customer support. Quality customer education ensures that your audience already has the information they need to resolve their questions and pain points, whether they are still considering making a purchase or trying to maximize value from what they’ve already bought.
Implementing Customer Education Efforts
While the general concept of customer education is important, some companies are taking the concept a step further as they tailor education efforts that are aligned with their customer’s unique needs.
Dr. Christopher Elia, neurosurgeon and co-founder of Nuform Health, shared how Nuform is using customer-tailored education during a recent conversation. “Our goal is to create a guided, individualized treatment program for each of our patients that is based on their health goals and needs,” he explains. “We aim to provide all our patients with a deeper understanding of their current health status. We kick this off by taking a deep dive into their lab work to provide them with enough information so they can make an educated decision on how they would like to proceed with their healthcare journey, and then we offer the support to help them get there.”
An individualized approach such as this can be particularly valuable for service-based businesses, where specific solutions and services often need to be adapted based on a client’s unique situation or pain point.
But what if you are working with a larger client base, or providing education on how to better use a product or service? As noted earlier, a resource library containing blogs or online courses can be an effective resource that enables customers to find help on specific topics related to your product or service.
A video tutorial could be especially compelling. Viewers notably retain 95% of the information contained in a video, as opposed to just 10% of what they read. A video can also make it easier to inject some of your brand personality in tutorials and how-to’s to make them more engaging for the user.
Depending on the complexity of your product or service, you might also consider creating an online community or forum where customers and support staff can ask questions, share ideas and learn from each other.
In a podcast interview, Dave Derington of ServiceRocket, explained, “It’s a place where we encourage not just our customers, but our partners, our team members, and everybody to have a home base just like I go to Facebook or something where I have a community of people that I care about, and I interact with. […] And then it started serving us as a way where people were promoting ideas and natural things were happening.”
Evaluate which solutions make sense for your business and its audience, and your customers will become better educated and happier with what you have to offer.
Create Lifelong Customers Through Education
Your efforts to educate your customers should be a central part of your marketing framework. By embracing a strategy that gives customers the necessary resources and information to make the most of your product or service, as well as providing other relevant information and tools, you can build a stronger relationship with your customers that improves both satisfaction and retention.
As you maximize the value you can provide to your customers through your educational efforts (no matter what form they take), you will be able to establish yourself as a trusted influence in your niche and generate lifelong loyalty.