5 Practical Strategies for Improving Client Retention Using Customer Engagement Score

Are you seeking to improve your client retention rates? Data shows that getting new clients is up to 5 times more expensive than retaining existing ones, and increasing your client retention rates by just 5% delivers over 90% in increased profits. So how do you prevent cancellations and improve retention? Start by determining each client's customer engagement score (CES). A CES is a business analytical tool that helps you measure how much a client is engaged with your service.

5 Practical Strategies for Improving Client Retention Using Customer Engagement Score
Toronto, Canada, October 18, 2022 --(PR.com)-- Before defining the term customer engagement score, let's first assess the meaning of - customer engagement. Customer engagement is a continuous process of interacting and communicating with your customers through strategic contact or interaction points such as emails and text messages. Any space or platform through which your target clients can consume your content or enjoy your service offering is an interaction point.

As the name suggests, a customer engagement score (CES) is a measurement indicating the extent to which your clients engage with your business. A high score means the customer is using your service and interacting with your business. Conversely, a negative change in engagement score signals disengagement and is an opportunity for your business to interact with the customer and understand the decline.

LenzVU’s Customer Engagement Formula

LenzVU bases its customer engagement score calculation on an algorithm that tracks the customer interaction points, which include:

- Client website visits
- Physical location visits
- Phone calls and interactions
- Text Messages and interactions
- Email activities (open and clicks)
- Activities on other platforms (MindBody, Mariana Tek, FitDegree, etc.)

The LenzVU algorithm works by:

- Aggregating the number of engagement actions a user performs over a specified period.
- Weighing an interaction to correspond to the value it delivers to the business. For instance, checking in for a workout session does not carry the same engagement weight as opening a promotional or informational email.
- Providing an engagement score depending on the number of interaction points your business has with clients.
- Establishing a trend by looking at historical behavior patterns showing whether the engagement is constant, increasing, or declining over time.

According to Afi AflatoonI, CEO of Tribute Kiosk, the company that owns LenzVU, "We trend the score against a customer's historical behavioral patterns, allowing a business to understand if there is a change in customer engagement. For example, suppose a customer has a CES of 154, but with a downward trend of 64%, the business should investigate the drop before the client terminates their subscription."

Customer Engagement Score Example
LenzVU customer engagement score formula is an algorithm that assigns weights to different customer interaction events, aggregates their frequency, and establishes an engagement trend based on the overall clients' behavior.

The tool presents a score and a percentage indicating the clients' overall engagement trend. LenzVU computes the trend percentage by comparing the client's present engagement against patterns over the past three months.

How to Use Customer Engagement Score for Client Retention

Client retention is the capacity of a business to maintain clients over time. Data shows that gaining new clients is up to five times more expensive than the cost of retaining existing ones, and increasing customer retention by just 5% can increase profits by up to 95%.

Using customer engagement scores, you can segment your clients and develop a customized retention plan for each. For instance, you may opt to segment your clients’ scores as follows:

80 - 100% - High engagement
40 - 80% - Medium engagement
0 - 40% - Low engagement

High-engagement clients with an upward trend are fully engaged and are effectively using your service. By leveraging this data, you can focus on clients that have a declining CES and implement strategies such as:

1 - Have a customer outreach schedule - Have a plan for communicating with your clients to increase sales, solicit feedback, or re-engage with your clients. Especially for customers with medium and low engagement scores, be sure to implement their feedback judiciously. Make your clients understand you care about their goals when joining your facility and want to work with them to achieve them.

Reaching out to low-engagement clients will help you understand their reason for not interacting or using your service and allow you to make meaningful connections. For instance, a client can have a low engagement rate because they used to attend their session with a friend who is no longer coming.

What's the opportunity to make a meaningful connection in such a situation? If your facility is a gym, you could assign a temporary complementary fitness trainer to coach and motivate the client during their sessions. With this, your client can not just see that you care about their well-being and the value of signing up for a package that comes with a personal trainer.

Alternatively, maybe the client had an accident, and because you reached out, you get to send them a get well soon card and deepen the sense of connection to your institution.

2 - Rewards and loyalty programs boost engagement - Consider implementing robust customer loyalty and rewards initiatives. For instance, you may give customers rewards for programs for attendance, participation, meeting set goals, or spending their resources on specific packages or facilities.

3 - Design personalized offers and packages in response to client needs - Remember, 80% of clients are more likely to do business with companies that offer personalized services. Therefore, consider amending packages to suit client lifestyles and preferences, especially for those whose declining engagement is due to irregular attendance due to conflicting schedules.

Further, refer to clients by name in digital and in-person communication. To achieve this, maintain a rich client database, so you don’t have to ask the customers to repeat themselves.

4 - Have interactive content that educates your audience - Customer-centric interactive content like quizzes, image sliders, games, or interactive webinars will boost customer engagement. Interactive content not only has a higher engagement rate but is also known to deliver high conversion rates.

5 - Build a community to enhance customer retention and experience - Establishing a community around your brand will build lasting relationships with your clients and enhance customer loyalty. Studies have shown that if the clients linger around at gyms they are more likely to renew and stay.

Frequently Asked Questions on Customer Engagement Scores:

How do you calculate customer engagement rate?

LenzVU's proprietary algorithm calculates customer engagement by weighing and aggregating the number and frequency of customer interactions with a business. The algorithm then computes a score and provides the percentage trend.

What is a good engagement score?

A good engagement score will vary according to the engagement strategy of a business. For example, a company might send out emails daily, while another only sends them monthly. Therefore a good client engagement score for the business with daily emails should be higher than the business that sends out monthly emails.

The other variable in determining a good engagement score is the client’s patterns which may not remain constant over a short time. For instance, a client might not open emails since they are super busy, while another might open and click on all the emails.

Consequently, LenzVU's customer engagement score provides trend analysis to help businesses understand a change in engagement patterns based on their client’s history. Trend analysis indicates the shifts in engagement behavior of a particular user and implements a retention strategy before a client cancels a subscription. A client with over 70% upward trend pattern has a good engagement score.

Final Thoughts

LenzVU’s customer engagement score platform provides a score and a trend analysis showing the behavioral pattern of a client. The trend analysis puts the engagement score in perspective, helping you determine if the customer is fully engaged, will continue with your service, or is on the brink of canceling their subscription.

Their customer engagement score insights equip you to develop data-driven retention strategies targeting clients with declining engagement trends. Please contact us for a free product walk-through and more information on how LenzVU can add value to your business.
Tribute Kiosk Inc.
John Peters