We all know how acquiring new customers is essential to the growth of any business. However, getting a new customer costs about 5 to 25 times more than to keep the existing ones and existing customers usually spend 31% more than existing ones. Hence to ensure a business long-term growth and prosperity, it's essential to go beyond customer acquisition and prioritize building a loyal to achieve sustained success.
Building a loyal customer base is key to grow as they spread positive word-of-mouth, contributing to customer acquisition, and they will likely re purchase from you. Research found that existing customers are 50% more likely to try new products and, on average, spend more compared to new customers. Therefore, it is crucial to implement effective customer retention strategies to foster long-term relationships with your existing customers.
Nevertheless, in a saturated business landscape where many companies offer products similar to yours and with customers whose needs and desires are constantly evolving, maintaining a loyal customer base is an ongoing challenge. The question becomes, What can we do to encourage new customers to stick around and keep using the product?
Well, during the onboarding process a company is welcoming the customer to the product experience. Getting the onboarding process right is fundamental because it serves as the starting point for customers to start using the product and actively engage with the brand's offerings. In addition to that, during the onboarding process it is possible to collect information that are fundamental for maintaining ongoing communication with customers, ensuring that the brand remains on top of their minds and encouraging future purchases.
In this article, we will look at how we can bring customers on board and have them consume more and more of your product by providing a 7-steps onboarding checklist.
What is customer onboarding?
Customer onboarding is the means by which a company educates new customers about the value of the product they purchased. It involves familiarizing with the product's features, demonstrating how to use it, and highlighting its relevance to their lives. Through this process, customers gain a clear understanding of the product's benefits and how it can enhance their overall experience.
The onboarding process encompasses two significant milestones. The first occurs when the customer signs up for the product, marking the initial step in their journey. The second milestone is when they have their first successful experience with your product, which solidifies their understanding of its value and utility. These two key moments in onboarding play a crucial role in engaging customers and establishing a positive relationship with your product.
Note that the success of using a product or service looks different for different customers. For some, it could indicate profit; for others, it could save them personnel, time, or resources. Regardless of what success is most likely to come to a customer, the primary goal for customer onboarding is to bring value to the customer as soon as possible so they can keep coming back to your product and incorporate it as part of their lives.
On top of that, it is also important to highlight that customer onboarding looks different for different industries because it could involve a product, a service, software, or an app. In the case of consumer goods brands like Sony, the onboarding process primarily focuses on ensuring that customers are equipped with the knowledge to set up the product and maximize their overall experience. This entails guiding them through the setup process, providing instructions on using different features, and offering tips and tricks to enhance their usage.
By tailoring the onboarding experience to suit the specific needs of each industry, businesses can effectively empower their customers to make the most out of their offerings.
Why is customer onboarding important?
Customer onboarding is a fundamental step for a company selling consumer goods as it sets the stage for customer satisfaction, product adoption, and long-term success in a competitive market. By providing clear instructions, addressing customer needs, and fostering a positive initial experience, onboarding ensures that customers feel supported, confident, and well-informed about the product. The following paragraphs will outline the key reasons why customer onboarding is essential for consumer goods companies.
1. Customer Experience
According to Forrester, “to succeed in today’s digital environment, firms must deliver smarter, more-customer-centric interactions that feel like they were tailored for each user and his or her specific set of circumstances”. All these interactions together are also referred to as customer experience, a fundamental area to work on for consumer good companies to differentiate their brand by creating a unique experience for their customers.
Customer onboarding is the first stage of the customer experience. It is particularly important because it creates the first impression of the brand in the mind of its customers. Having a smooth, intuitive and, why not, also fun onboarding process increase the overall retention rate. As the saying goes, starting off on the right foot sets the stage for success, putting you halfway towards your goal.
Creating a good first experience entails:
Product Familiarization
Effective customer onboarding acquaints customers with the product and sets expectations for the quality standard they will expect from your company. It's done to properly educate the customer so that they can be in a position to gain the most out of the product.
Consumer goods often come with various features, usage instructions, and benefits. Effective onboarding familiarizes customers with the product, ensuring they understand how to set it up, use it correctly, and fully leverage its functionalities. This helps customers overcome any potential confusion or challenges, leading to a smoother and more satisfactory experience with the product.
Optimizing Product Usage
Consumer goods companies want customers to derive maximum value from their products. Onboarding provides an opportunity to educate customers about the product's capabilities, different use cases, and tips for optimal usage. By empowering customers with this knowledge, companies increase the likelihood of customers using the product to its full potential, resulting in higher satisfaction and repeat purchases.
Wyzowl reports that as high as 55% of people returned a product due to a lack of awareness of how to use it properly. A customer-centered onboarding process will ensure that you increase the chances of the customers engaging with the product and eventually lead them to breakthroughs by using your product. This will, in turn, foster loyalty to your company.
2. Collect Valuable Customer Data
If brands want to craft a personalize digital experience around their product to become more competitive, collecting customer data is essential. There couldn't be a more opportune moment to gather consumer data than during the onboarding process. Why? It is the perfect moment to collect relevant insights on your customers as the after-sales is the period when customers are most engaged, excited, and open to learning more about their new product.
When customers register the product, usually in exchange of some kind of benefits (ex. extended warranty), they can be asked to fill out a data form. These insights help in creating a superior customer experience, targeted marketing campaigns, validating audience modeling, and improving customer support during the user journey.
3. Minimizing Product Returns
A lack of awareness on how to use a product properly can often lead to customer dissatisfaction and product returns. As you probably know, returns typically cost to the company 66% of the product price, leading to reduced margins.
Through effective onboarding, companies can address this issue by providing clear instructions, demonstrations, and support materials. By helping customers understand the product's features and usage, onboarding reduces the chances of returns due to misuse or misunderstanding.
4. Building Customer Loyalty
By delivering a positive onboarding experience, consumer goods companies can create a strong foundation for customer loyalty. When customers feel supported, informed, and confident in their product usage, they are more likely to develop trust and loyalty towards the brand. This loyalty can result in repeat purchases, positive word-of-mouth referrals, and long-term customer relationships.
Additionally, it's crucial to emphasize the significance of collecting customer data for designing effective loyalty programs, such as customer clubs. The onboarding process therefore plays a pivotal role in enhancing loyalty also by enabling improved data collection.
5. Competitive advantage
Another reason why this is important is that it improves even customer acquisition. About 63% of consumers equate the support they receive post-sale of a product as the essential fundamental part of deciding to purchase it. Therefore, by being aggressive in this aspect, the conversion rate tends to increase as well.
Upselling and Cross-selling Opportunities: Customer onboarding presents opportunities for consumer goods companies to showcase the full range of their product offerings. By educating customers about related products, complementary accessories, or upgrades during the onboarding process, companies can effectively cross-sell and upsell to increase customer value and revenue.
Therefore, onboarding sets up customers and also companies up for success.
Design a superior onboarding process through a 7-step onboarding checklist
To achieve a successful outcome, the organization of the onboarding process is crucial for consumer goods companies. With a well-designed onboarding process, you can make your customers feel valued and establish a strong foundation for their relationship with your brand. The following sections outline key considerations for designing a superior onboarding process specifically tailored to consumer goods companies.
When designing an onboarding process for consumer goods companies, it's important to consider three main areas:
1. Onboarding flow
Design a seamless and intuitive onboarding flow that guides customers through the initial stages of their product experience. This involves mapping out the steps and interactions necessary for customers to become familiar with your consumer goods, from the initial sign-up to successfully using and deriving value from the product.
First, the onboarding process for a consumer good should ideally happen on a web app, as 99% of customers hate being forced to install apps to do business. A QR code can be placed on the product or the product packaging so that by scanning it, customers can easily access the web app.
The 7-steps onboarding checklist includes:
Welcome and introduction: Start by welcoming customers and providing a brief introduction to your consumer goods. Clearly communicate the value and benefits they can expect from using the product.
Product registration: In order to access resources for an optimal product usage, customers can be asked to register the product by providing some information about themselves. These information can include, first name, second name and email, or even more in-depth information.
Product configuration: Guide customers through the process of setting up and configuring the consumer goods. Provide clear instructions, visuals, and any necessary tools or resources to help them get started smoothly. With Layerise you can create intuitive videos to demonstrate how to set up and configure the product.
Product demonstration: Showcase the key features, functionalities, and unique selling points of the consumer goods. Use visuals, videos, or interactive tutorials to demonstrate how customers can make the most of the product's capabilities.
Hands-on practice: Encourage customers to actively engage with the consumer goods by offering interactive exercises or simulations. This allows them to gain practical experience and confidence in using the product.
Troubleshooting and support: Address potential challenges or questions that customers may encounter during the onboarding process. Provide comprehensive FAQs, a knowledge base, or access to customer support channels to assist them in resolving any issues or concerns.
Progress tracking and milestones: Implement a progress tracking system to show customers how far they have come in the onboarding process. Celebrate milestones and provide positive reinforcement to keep customers motivated and engaged.
Personalization and customization: Offer opportunities for customers to personalize their experience with the consumer goods. This can include customization options, preferences settings, or recommendations based on their specific needs or interests. Layerise does that completely automatically for you.
This onboarding checklist can be used for all consumer goods companies that are willing to leverage superior customer experience to gain a massive competitive advantage.
2. Content
Identify the essential information and resources required to educate customers effectively about your products. This includes clear instructions, product guides, tutorials, and any other relevant materials that help customers understand how to use the consumer goods and derive maximum benefit from them. The content should be easily accessible and presented in a user-friendly manner. Read more on how to create onboarding content here.
Did you know that 83% of individuals prefer video tutorials over text or audio for accessing instructional or informational content? This makes it essential for you to create video resources to help your customers understand how to use your product effectively. When creating these videos, it's important to consider the optimal length. Aim to keep the tutorial concise while ensuring that all the crucial information is communicated clearly to customers.
Make your videos engaging by delivering clear instructions and avoiding excessive length that may discourage customers from watching until the end. If necessary, prioritize audio quality over video quality. Remember, you don't have to be a professional video maker to create impressive and effective video tutorials!
3. Customer relationships
Develop strategies to establish positive and personalized customer relationships during the onboarding journey. This involves providing excellent customer support, promptly addressing any concerns or queries, and ensuring that customers feel valued and supported throughout the process. Building rapport and trust with customers lays the foundation for long-term loyalty and satisfaction.
By focusing on these areas, consumer goods companies can design an onboarding process that enables smooth product adoption, equips customers with the necessary knowledge, and fosters strong relationships that drive customer loyalty and satisfaction.
How to monitor the effectiveness of the onboarding process
Monitoring the effectiveness of the onboarding process is crucial to identify areas of improvement and ensure optimal customer experience. Here are some ways to monitor its effectiveness:
Customer feedback: Collect feedback from customers who have gone through the onboarding process. This can be done through surveys, interviews, or feedback forms. Ask specific questions about their experience, satisfaction levels, and any challenges they encountered. Analyze the feedback to identify patterns, common issues, and areas where improvements can be made.
Usage and adoption metrics: Monitor usage metrics to understand how customers are engaging with your consumer goods after onboarding. Track metrics such as activation rate, feature adoption, time to first value, and user activity. By analyzing these metrics, you can assess whether customers are successfully incorporating the product into their routines and deriving value from it.
Customer success indicators: Define key indicators of customer success and track them over time. These indicators may include customer retention rates, customer satisfaction scores, renewal rates, or upsell/cross-sell opportunities. By monitoring these indicators, you can gauge the impact of the onboarding process on long-term customer success and business growth.
Onboarding completion rate: Measure the rate at which customers complete the onboarding process. This indicates the effectiveness of the onboarding flow and whether it is engaging and guiding customers successfully. A low completion rate may signify potential hurdles or areas for improvement in the process.
Onboarding duration: Assess how long it takes for customers to complete the onboarding process. A lengthy onboarding duration could indicate complexity or friction points that need to be addressed. Strive to streamline the process and make it more efficient while still ensuring that customers receive necessary information and support.
Onboarding process FAQ
What are the challenges related to customer onboarding?
The more complex the customer’s requests, the more challenging customer onboarding becomes for that customer. It can be quite a lengthy and sometimes frustrating process for the customer.
One of the biggest obstacles to customer onboarding is the Know Your Customer and Customer Due Diligence (KYC and CDD) processes. It involves collecting, processing, and ensuring that a significant amount of KYC data and documentation is correct. It guarantees that the client and their financial sources are legit. The KYC reviews, and CDDs are very time-consuming and may slow down the process, making it more frustrating for both parties.
How do you automate customer onboarding?
One of the best ways to automate client onboarding is to work with a customer onboarding software solution. By doing this, you help obtain and analyze extensive records of customer data quickly and accurately. For example, getting a website that can help you: pull information from Identity Cards, process paperwork accurately and in a time-efficient manner, and organize your data in an easy process. By automating customer onboarding, the satisfaction of your customer experience will significantly improve.
You get this with Layerise, built for consumer brands to smoothen the customer experience and registration process. It enables you to create product-specific assistants that the customers can install on their preferred devices, and you also get to provide real-time customer support. Book a demo here.
What are the C’s of effective onboarding?
They are:
Compliance: It's done when the new customer provides you with their data, which you need to ensure it is protected in line with, as Layerise does with private data, to be compliant with both GDPR and CCPA.
Clarification: Educating and ensuring the customer and company staff know their roles, goals, and expectations.
Confidence: This is needed for the customer and business to feel they can work together.
Connection: Building a meaningful connection with the customer ensures smooth operations, as both parties can freely express their concerns should they arise.
Culture: A good work culture works to attract and help retain current customers.
What is essential to a good user onboarding experience?
It should be:
User-centric: Good user onboarding experiences aim to teach the user what they require to commence with the product.
Action-oriented: The best user onboarding experiences should allow users to complete actions as quickly as possible instead of showing them how they will perform the various tasks.
Informed: Good user onboarding experiences focus on ensuring that the user obtains value from the product as soon as possible; because this is the goal for user onboarding.
Evolving: The user's features must be checked to ensure they do their job. If not, they are modified to do it better.
Holistic: A good onboarding experience should not just happen once the user uses the product. Instead, it ought to be ever-present and available.
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