7 Key Ideas to Improve User Retention:

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Firstly, What is User Retention?

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The evaluation of how many users return to use the product again is known as Retention. Retention is considered as the key factor that indicates the real value provided to the customer. A great design not just brings a good impression on the product, this impression also helps in retaining a good number of users. Do you know that “It’s seven times easier to retain a customer than to acquire a new one!”.

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The process of retention starts right from customer onboarding throughout reaching the end goal which has to be designed to give a smooth experience. Even a minor inconvenience makes the user switch to your competitor. So the real question is, “What will keep them coming back for ?”

Why Retention is Crucial?

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The following questions might have arisen in your mind in recent times. “Why is the term “Retention” heard widely in the field of user-experience?”. “What is the fuzz all about?”. "how to increase user retention?"

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When the product is providing real value to the user, retention happens concurrently. Therefore, this implies that the value given to the user is directly proportional to customer retention. This metric is considered salient because it causes a greater Return on Investment (ROI). The efficiency of investment is more when a customer is retained than when a customer is acquired. 

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Since this little word has so much going on, why not exploit the advantages revolving around it?

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Every UX designer must be familiar with the strategies that open the door for User Retention. A well-structured UX strategy builds happy customers. The following are various working UX strategies for your business that induces Retention. So let's explore all the important points on how to improve user retention.

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1. Acquire Customer Feedback
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To know what the customers feel about your existing design of the product is the first step in improving your business. Collect feedback from your users, process, and analyse it to recognize their needs.
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There are several ways to obtain feedback from users. The most convenient one of it all is to conduct a survey. Gather the results and analyze the trends in it. Through this analysis, the areas for improvements and customer’s criticisms can be given attention. 

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2. Prioritize Customer Satisfaction

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Customer satisfaction is the ultimate factor that is going to retain them as your customer. Instead of waiting for customers to give feedback, be a step ahead by reaching out to them.

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The eminent way of knowing the level of your customer’s satisfaction is by conducting surveys. Implementing a survey into action helps you understand the customer’s impression of your product. However, there are different methods to proceed with this approach. Two predominant practices are:

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Customer Satisfaction Score (CSAT)

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This is the feedback obtained from the customer during a purchase or any interaction. The simplicity of this survey makes it the most efficient. It can be determined by asking straightforward questions to customers like “How satisfied are you with our service?” or simply through their reactions to your posts.

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Be consistent in maintaining the scale of the score. And, if any customer expresses unsatisfactory feedback, look into it for immediate retrieval. Always be observant of the CSAT and maintain it to be at least 75%-85% to ensure customer satisfaction.

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Net Promoter Score (NPS)

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The index that depicts the overall customer satisfaction and loyalty to the brand. This is measured on a scale of 0 to 11 where the customers who give the score below 6 are called “Detractors” and those above 9 are called “Promoters”. The customers in between are referred to as “Passives”. 

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The detractors are highly unlikely to make another purchase with your brand whereas the promotors beam with loyalty to you. Thus, provide services to your users to the level that they turn out to be promoters. 

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The Net Promoter Score is calculated by subtracting the detractor percentage from that of Promoters. The resulting answer is expressed as an integer and it can range between -100 to 100. It’s crucial to maintain a good score as it is proven that the NPS correlates with business growth. 

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Maintain a healthy routine of having customer engagements to know their opinion. Know the feedback at several points of providing services or making a purchase and fix the point which is unsatisfactory. 

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3. The Ingenious-Newsletters

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Newsletters are the evergreen strategy to provide value to the customers while subtly reminding your brand to customers. A Newsletter is cost-cutting, efficient, simple, and a convenient way of engagement with existing users. Make use of this ingenious tactic to never lose touch with your loyal customer. 

4. First Impressions Last

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The striking first-look at your product design is the impression that will probably last for long. The infamous “First impression is the best impression” stands true in this case. Hence, for successful outcomes and repetitive usage, the first impression on your design makes a huge difference. 

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The firm anchorage to the user’s initial excitement through sophisticated design would be a smart move. To achieve this, Brainstorm on what excites the customers. The right way to do that would be to be in the customer’s shoes. 

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5. Spotlight on Social Proof

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Customers tend to believe what they see and hear from the former customer. The trust users put in the previous customer’s experience is more likely than on the brand’s advertisement itself. Utilize this reality to directly influence your customers. Get testimonials from your most satisfied customers and publish it to establish your brand value.

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Draw attention to the success stories of your customers and this attracts your existing customers to hold on to your product/brand. The sense of reliability these testimonials provide to your brand has no bounds. 

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‍6. Keep an Eye on Red Flags

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While you plan on strategies to retain your customers, don’t ignore the red flags. Always keep an eye open to know what makes the customers terminate their engagement with you. Identify the areas at which the users tend to struggle and fix it. 

Focus on these areas and improve the user experience to prevent losing the customers and increase retention.

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7. Maintain a Consistent Brand-Experience

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Consistency is the key. It makes all the difference between the customer-beloved brand and any other brand. This builds trust amidst the customers which is the foundation for retention. Right from the moment they have their first impression, stay true with the experience you provide to the users. This consistency takes your brand a long way with your loyal customers. 

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The UX in every point of their interaction with your brand says about the overall experience to your customers. Therefore, be conscious in every step of the design and have an eye for even minor details. 

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Since there are too many competitors out there in the market, it is crucial to know your retention rate. By focusing on the retention strategies, the course of your revenue and brand value improves greatly. 

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How to Measure Retention?

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By implementing the above-explained strategies, the second-thoughts in the user’s mind can be eliminated. To see how well your strategies are working, it is essential to have a measure to analyse the results. Let us now see how retention can be measured:

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The retention can be measured in four steps precisely. They are,

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1. Choose an indicator

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Firstly, An indicator to be tracked for measuring the retention must be finalized. This can be chosen based on your end goal. If your goal is to make more sales, the revenue generated can be chosen as the key indicator. Or, if the goal is to reach more audience, the traffic acquired can be the one. This is the factor that will be tracked to determine retention.

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2. Choose a Time Period

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Secondly, the period of time over which the indicator will be tracked is known as the time period. This can be fixed, once again, based on the goal. One can determine the time period on the frequency of the ideal customer to visit your site. It could be on a daily, weekly, or even yearly basis.

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When the time period is determined, the patterns of customer usage can be analyzed and retention will thus be calculated. 

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3. Recognize the initial action

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The action that is performed by the user to be tracked is known as the initial action. Only after carrying out this action can a user be analyzed. It could be any action such as subscribing to a newsletter, buying a product, etc.

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Like the indicator and time period, determining the initial action is also crucial for measuring user retention.

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4. Recognize the follow-on action

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Similar to that of the initial user action, the action that is performed over the course of time is known as follow on user action. The users who accomplished both initial and follow-on actions will be categorized separately.

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Such a group of users with similar actions is known as a “Cohort”. They are categorized and observed individually. It is infamously called “Cohort Analysis”.

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Or more simply, one can use the following formula to calculate the overall retention:

How to Exploit the measured Retention rates?

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Once you have acquired the numbers, make the best use out of it to accomplish the objectives. Initially, compare the obtained retention rate with the industrial standards and see where you stand. While doing so, remember that it’s absolutely okay to not meet the standards. This step is carried out to plan the forthcoming strategies to continually improve your progress.

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Set strong retention goals and work constantly towards it. If you think deeply, retention remains as the true indicator of your product’s success. Not revenue or any other factor in that case. Because retention is that one factor that truly says you’re doing it right. 

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Relationship between UX and Retention:

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Focus on the User Experience and work on it to improve your retention rate. Acquire help from an experienced designer for this aspect. Create a new strategy to improve the user experience which influences the retention rates.

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A great User Experience causes wonders in your future retention. Access the existing UX and strategize a powerful plan to fascinate your users. 

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User Feedback and Measurement:

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• Conduct User Surveys: Regularly gather feedback through surveys to understand user pain points and desired features.
• Implement Customer Satisfaction Score: Track user satisfaction with a simple post-interaction survey (e.g., "How satisfied are you?") Aim for a CSAT of at least 75%.
• Measure Net Promoter Score: Gauge customer loyalty by asking "How likely are you to recommend us?" Calculate NPS and strive for a high score (positive difference between promoters and detractors).
• Showcase Testimonials: Build trust and social proof by featuring positive testimonials from happy customers.

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Enhancing User Experience:

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• Prioritize User Onboarding: Design a smooth onboarding process to help users get started quickly and efficiently.
• Personalize the Experience: Tailor content, recommendations, and features to individual user preferences for a more engaging experience.
• Leverage Gamification: Motivate users with points, badges, or leaderboards to keep them coming back and using your product/service.

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Read More:

Maximizing UX Impact in Fintech App Design: The Key to Success

6 Step Guide to Master Dashboard UX Design

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