130. Does Your Customer Retention Strategy Miss THIS Element?

0:00Do you engage with your customers enough? A flourishing online community is the difference between customers who churn out within months and customers who stay with you for years. Today, we have with us an expert at building vibrant communities. This is Ryan Atkinson, and you're listening to the Upflip Podcast, where we uncover how great businesses are built, how they're run behind the scenes, and how you can replicate their success. Guys, today, we have an amazing episode with Shanna Lynn. She knows how important customer attention is for any business. she gives us some customer attention chips for you guys strategies for engaging with your community members and how to build that lifetime value with your customers guys this is a super fun episode excited for us to dive in shanna welcome to the show super excited to have you hey thanks for having me this is gonna be fun this is going to be a blast and you're an expert in all things community people are thinking about oh i want to build a community i want to build a community but how do i actually do that you're gonna be the person to help us with that so let's rewind back the clock though so people know where you're coming from in 2019 you start community Cultivated, which is a training and consulting to create a thriving community for your brand.

1:03Let's talk about 2019 and starting this. Can you take us back to this time? Yeah, you know, it's kind of interesting because I like to think that it started back in 2008, because that's the first time that I spoke about online communities and how to use online communities for businesses. And so I worked in corporate for academic medical centers, helping them build online communities and did training there. And then in 2012, went full time as a consultant. But at the time, I really needed to have a marketing angle, because people didn't really see the value of community. They really didn't see the value of it with retention.

1:33So I took a marketing angle with my consulting agency and then ultimately was able to really shift into what I do now and what is community cultivated that we started in 2019, which is specifically training people on how to leverage community to keep their customers so that they can increase the lifetime value of their customer. Interesting, I love that. Let's set a baseline though for the listeners. Can you define what community means to you? Let's just set that baseline for everyone listening for here on out. Yeah. So it's not a Facebook group, which I think is what a lot of people think about.

2:02When I talk to business owners, they're like, oh, I need a Facebook group. I'm like, but do you? I don't think you do. Really, it's a group of people that are moving towards a common purpose or a common cause and are connecting with each other. And that connecting with each other is really what distinguishes a community from like an Instagram audience for perspective. You know, a lot of people will say, oh, I have a really big community, but they're really just talking about their followers on social media. Interesting. So where are these communities built at then? Can you take us through some of those?

2:28because like Facebook groups obviously come to mind and like there's a few other social media platforms that come to mind for like communities. But like if someone is wanting to build a community for their business, what social platforms and what ways can they start building that community? Yeah, so it does honestly start oftentimes with the social media, with your email list, with that audience. But our goal is how can we actually get them connecting with each other and not just this one-way communication. And that can be done in Facebook groups. It can be done on other online platforms like Mighty Networks or Circle or School.

2:58there's 1000 of them out there. Facebook is probably the easiest. I know people who use Instagram group DMs to start their communities. But really, how I want people to think about it is less about the platform, because I just released a podcast episode last week, that's like how to choose a platform and why it doesn't matter in the end, but more about how am I creating space for people to connect with each other around this particular topic. And that could be a zoom call, it can be an in person event, it could be your retail store where you have fun events on Saturday that bring your community of shoppers together to gather and have fun.

3:32Interesting. And so let's use that retail example. I'm just curious. So what would like a community event look like for a retail store that wants to bring people into their store for some sort of event? What would that look like? The first thing I think about with retailers or like brick and mortar businesses is first off, what community events are already happening that you can enter into? Because that's the easiest way to do it. Our little town here, south of Nashville, always has a big festival every year that my kids love to go to. Lots of businesses enter into those events to build relationship.

3:57But I also think about my aunt who used to run a women's clothing store. And every Saturday, she had this like mimosas and shopping event. And there would be ringing of bells and giveaways and prizes. And she would do that one Saturday a month, which would help people connect, bring the community together. And when it's an event like that, I think people naturally come wanting to connect with one another. I think that is such a cool value add is like, especially for like a retail brand, it's like making that community in person. And like people can actually like go to and like see like, oh, this is not just like some retail store, like there's actually a community built.

4:31And I feel like community is such like a big trend, especially here in Austin, I'm sure nationwide, but like people want those communities and have it be more than something just like from a D to C brand, they actually want community with the brands that they engage with. Yeah, they'd much rather shop at your little boutique that makes them feel special than to shop at Target, for example. And I always talk about, you know, the three R's of retention that I teach. So results, recognition and relationship. And even as a retail brand, you can think about those things of, you know, first off, like, does my product get people results?

5:01Is my auto body shop actually helping people get their car, you know, have a longer lasting car? And then relationships just comes from, you know, am I building relationships with people? Of course, if we can extend that to relationships with others, then that's even better. But I think about my local mechanic, we have a great relationship with him, we can count on him. If we have something come up, we know he's going to give us the best advice, because he doesn't want our money, he cares about us. And then recognition, like, am I being acknowledged as a human, as a customer, the progress that I'm making, the loyalty that I've had to that brand?

5:35Do I feel that recognition? These are all things that we desire as humans. So when we get them, it's natural for us to want to come back. I really like that. I feel like that is just like such a good way to connect with people on a deeper level and connect with your customers on a deeper level. I am curious. So if someone's listening right now and they're like, okay, I am budding this community thing. Let's do this first step. Like if they want to get identifying find people to join them? Who should you identify to actually like be part of this community? Are you just asking your customers or who should you actually ask?

6:00Yeah, it always starts with your existing customers first, right? And then usually moving out to your audience beyond that. But the beautiful thing about community building versus audience building is audience building is a lot of us, you know, kind of fishing, like going out and constantly casting a line, whereas community building is like all the fish telling all the other fish like, hey, you should come over here and hang out. So it's a little bit more organic if done well. I teach four pillars of a thriving community, but those first two are where I recommend everybody start. And that's having a very clear cause, which is the purpose of the community.

6:32Why should people be here? You know, what are they accomplishing together? What are they sharing? What is that common thing? And then the second is culture, which are the beliefs, the behaviors and the boundaries that make our community really unique. Because you can go to, you know, one gaming community or one quilting community and another, and it's going to feel very different because naturally that culture is different. How do you set up that culture that will actually thrive? Are there some practices you have strategies or how do you set up that culture to succeed? Yeah, the first thing is defining it for yourself.

7:04Because what I find is that if people don't define it, their community creates the culture for them and they often end up hating it. So many people you hear who have built communities end up ghosting the communities, they end up like getting burnout or dreading showing up in the community. And often it's because they've allowed the community to define the culture and they don't love being there. So getting really clear, what are the beliefs? What are the behaviors we expect? What are the boundaries? And communicating those early on. So onboarding is the most important part of any business, any community.

7:33So that onboarding people think is often click here, do this, check this box. But really, it's actually an indoctrination of those cultural aspects of the community. I like that because like, even if you think about it from like a hiring perspective, if you have like these culture standards in place, it's kind of like funneling out the people that don't fit. And like, while your quantity might go down, your quality is going to go way up because you know from the start that they are a fit for your community and culture. Yeah, 100%. Like an interview process. Many of us who have online businesses in particular are doing launches or challenges or have some type of process that people go through before they get into our community.

8:09And in that process, they should feel your culture. They should be bought into that culture before they ever join. Because if not, they're not going to stay very long. And that's always the challenge is if you try to hide the fact that you have a very specific value or a very specific culture in your group just to get the sale, then it really doesn't matter because they're not going to stay. And your customer lifetime values can be so low that it's not even worth for you to invest to get a customer. We'll definitely hit on that customer retention point coming up. But when it comes to culture as well, I'm curious, what's like the hardest part of enforcing that culture then once you establish it?

8:42The hardest part of enforcing it is when there's somebody, especially somebody that you really like, that is a highly engaged and valued community member who steps outside of that culture. And they do it because naturally, we develop leadership within groups, and we start to feel like we can push boundaries. It's a natural cycle, storming cycle of communities. So when we have to have those crucial conversations with individual community members, it can be really challenging. But we like to look at them as these beautiful moments of really resetting the community where you can have an individual conversation just to realign.

9:16But then you can go and realign the whole community and just say, as a reminder, this is what we're about. This is the kind of behavior that we expect. And here's why. Because we're looking to create this thing for you, this place for you, this progress for you, this result for you. And we know this is the environment we need to make that happen. I really like that. And I like the framework that you had of like resetting it. We're not like enforcing the rules. We're not enforcing the rules. It's more like resetting that. So we covered those first two. So you said there's four, your end goal and then the culture.

9:41What are those next two pillars that you have? Yeah, the next one is communication. And this one seems really simple. But when people think about communication, they think about the megaphone, the one way like, oh, I need to make sure I'm sending emails and putting posts in my community. But there's two other types. One is the incoming communication, which is how are we hearing from our people? Are we surveying them? Are we asking questions in our email? Are we asking questions in our community? So we make sure that we know our people really well so we can serve them really well. And then second is that internal, which are the conversations that are happening.

10:11How are we helping facilitate communication among our members? That's the communication pillar. And then the other is the connection pillar, which is all about creating safety in the community. People come to me all the time. They're like, how do I create more connections? I need engagement ideas. I'm like, well, you probably have a safety problem. Do they trust you? Do they have clarity about why they're here? Once we establish safety, the rest of the stuff becomes really easy. The clarity pieces that come back to your first pillar of like, what's your end goal in mind and like being able to define that.

10:39Exactly. And just in general, having authenticity and transparency, because I think anytime that we're not super clear who we are, what we're about, what the purpose of this community is, and people lack clarity, and they're not quite sure how to show up. So every study with kids in general, which were really just like bigger kids, has shown that kids without a boundary on a playground do not play as actively, right? But if they have a boundary, they are more likely to free play and faster to free play. And that we're the same as adults. When we really understand those boundaries, we're more likely to feel comfortable to step in and engage.

11:15I love that you use that because I was literally just reading a book, The Body Keeps score. It was, they literally, that's a great book, phenomenal book, but it gives that example in there. Okay. So I think we've set a like a pretty good boundary on building a community, like what it takes to build a community. Let's talk about why it's so effective though, for those customer retention rates in your experiences at building these communities, the brands that you've worked with, the companies you've worked with, why are customers having such high retention rates when they are part of a community?

11:38Yeah, it really goes back to those three things that we crave, the results, the recognition and the relationships. And there's lots of ways to hit on those. So when I work one-on-one or in my group program with businesses who want to increase their retention, we're not just doing community strategy. But the beautiful thing about community is that it actually hits on all of those. So every study has shown that when we do things in community, we make more progress because we have that accountability, we have the motivation, we have the support. The other thing that's really awesome is that as a business owner, less of that is required of use.

12:07So Microsoft has an entire community run by users that answers questions for people with their products. That's huge savings for them as a business. So that's how it helps with results. And then we look at that recognition piece, the community gives us the opportunity for people to feel seen when that one business owner can't really see like, for example, I have clients with 10 ,000 plus paying members every month, that one owner can't see all of those people, but they can feel seen by everybody else in the community. And we can recognize their progress. And then the relationships piece is pretty obvious.

12:40You know, people say this all the time, but people come for the content, they come for the stuff, but they stay for the community and for the relationships that they build along the way. For over 100 episodes, we've been bringing you invaluable information about all things business. And now we're ready to take this a step further. I'm excited to announce the launch of the Upflip Academy, our flagship educational platform. Everything you need to launch a successful business all in one place. Curious about niches such as dropshipping or e-commerce? On Upflip Academy, you're going to find comprehensive courses and blueprints for over 200 niches.

13:11Looking for peer support, accountability, or even more, our network features some brilliant individuals ready to help you. Stuck learning specific skills such as SEO or social media marketing? You guessed it, Upflip Academy features no fluff courses on these and many other practical skills. And for a limited time, you can get all these for an early bird price. Hurry up and lock in your special price forever. Follow the membership link in the description of this episode. Yeah, you have my head spinning on about like the ways that like we can build community. We're not like a retail store. have like a physical location or anything like we're a video agency.

13:41I'm curious, like what would you advise someone that does have an online business? How can they get started in community? How do they build it online? It kind of depends on if you're service based or if you're product based or info based. So you being somebody who's more like service based around your agency, I was just talking to somebody this morning who's launching a benchmarking call for her clients so that they can get on a zoom call every single month, they can share what's working for them, share their results. That's community building, just having a call like that where they can get in and share and then they feel recognized, right?

14:12Because they're like, this is what's working, they can get support because they can share what's not working. So even a monthly zoom call can be a really great way to start building community. I tell a lot of people like if you start with one on one calls with your best customers and just ask them, where do you feel like you're getting stuck? What do you feel like you need more of if you were to connect with other people like you? How would you want to do that? Would you want to do that in a Slack channel or Facebook group. And it's such a light lift to start. You don't have to put a big financial investment behind it that it gives you the opportunity to play where a lot of areas of business don't give you that opportunity.

14:46So I just say start with your best customers, have conversations with them. And then based on the feedback that you get and the vision that you have, align those things by bringing them together in some platform. Facebook groups, obviously being the easiest for most people. You make it sound like so simple, which I I absolutely love because it shows your expertise and how well of a domain knowledge you know on this. I think what's super exciting for us when I'm thinking about it is that webinar. Because we sell to the similar director of marketing, VPs of marketing at smaller companies. So it's like we can all come together for a mastermind.

15:15I feel like it's just a perfect way to build community with our customers and then customer to customers building that community as well, which is a huge value add. Yeah, I have a group program that's for retention leaders of online memberships and subscription based businesses. And those retention leaders have never had a place to come. You know, community managers don't have a place to come and connect with other people who are running these million dollar memberships. They get more value out of that, I think, than a lot of the training that I have in there, just because they are speaking a similar language.

15:43And we do benchmarks so they can see what's good, what's not good. And where do I need to focus my attention? Yeah, I think that is so cool. Another question I want to ask as well, I know I just alluded to like, you're making it sound like super easy. Like, let me just do this and my customer retention rates will go through the roof. But like, what are some unexpected challenges when building early on a community that someone might not notice when they get started? The biggest challenge I think that people have once they get started is getting people to talk to each other. And I always get the question of how do I increase the engagement in my community?

16:13I post and it's crickets and nobody is there. And so that's why I do actually recommend getting people on a live call, like a Zoom call and give them a reason to be there, like host a little training in the beginning, have a guest expert come in if you feel like you need it. but give them a reason to make time to show up. But that face to face connection will actually stimulate the computer connection, the typing connection that you tend to not get if you're only doing like a Facebook group, and there's never any face to face. I also recommend a lot of people do a lot of webinar style. But if you can switch to like a zoom meeting style, and they can actually see each other.

16:48And instead of just typing their question in the chat, they actually get to raise their hand and ask the question. Yeah, there's some risk there. But there's lots of connection opportunities. So that I think is an important piece. But also just knowing that when your community is small is the absolute best time as a business owner, because you can have those one on one conversations, you can be direct messaging people to check in on them, you can be doing personalized video messages to them and getting to know them so that you create a great experience for them so that they want to invite other people in.

17:17So worry less about the engagement or the likes on your post and worry more about the connection with individuals. And frankly, I always say engagement isn't the metric anyways, it's progress. Because if people are making progress, they aren't going to leave. Yeah, absolutely. I think there's just like a ton of good opportunities, especially nowadays with like Zoom will meet and there's so many online tools like actually build community. And I feel like it all goes back to those like customer retentions rate and the lifetime value. Like there's so much to be said here about like the value of building a community and like what it can do for your business when it comes to retention rates.

17:48Yeah, it's exponential growth. I always tell people like, if you don't know your retention rate, if you don't know your customer lifetime value, which you don't have to have recurring revenue to have a customer lifetime value because you have repeat customers, you don't know those things, you have to know those numbers because everything that you do will impact that. And I just released a podcast episode about the connection between marketing and retention. And people forget about this all the time. But retention and customer lifetime value determine your marketing budget. Because if you're making $80 a customer, then that really limits what you can spend, especially if you have product costs in there, cost of goods, right?

18:23But if you can get that 80 up to like 120, then that difference, that$40 difference is profit that you can turn around and invest a little bit more in ads or whatever you're doing to get more customers. I remember when I was at HubSpot and Yamini was talking about how like we'll go from like one billion, whatever in revenue to like 100 billion in revenue, whatever the numbers were, but it wasn't new existing or new business that was going to come through is going to be customer retention and upselling to those current clients and keeping people on board with HubSpot. And I feel like that's just like true to like what you just said, instead of looking for external ways to grow your business, look internally and like customers you already have and how you can have a higher retention rate with them.

18:59Yeah. And you mentioned Ascension products and expansion into other revenue streams with your existing customers. Those are other ways to increase customer lifetime value. But at the end of the day, if the core goal is to serve them really well and get them a really great result, even if that result is just to feel better in their skin because you're providing amazing clothes that fit their style, right? It's not always like super result focused. But if we can do that for them, and we can continually listen to them, get feedback and provide opportunities for us to serve them better for them to get more results, then at the end of the day, they're going to be our best marketing, they're going to be loyal to us, which is wonderful, because they'll buy everything that we sell.

19:36But then they're also going to bring friends, family, you know, other colleagues into our world and your really great community can become your best marketing strategy. Exactly. I love that. Are there industries that this works best for though? And some industries that doesn't work best or across the board is like they work for all industries? Well, I know. I mean, I'm really deep in the like info product space. So memberships that are like fitness memberships or business memberships or quilting or art or whatever. So online memberships, it can have the biggest effect there because oftentimes we struggle with consumption, getting people to actually consume the thing that they subscribe to.

20:13I mean, how many of us have like subscribed to some membership and then you like get a renewal notice and you're like, oh, I don't think I ever touched that, right? So the community element can really help increase consumption, which increases retention. And we can see direct ROI in a really wonderful way where we can see the millions that we've helped clients make off of existing customers. But I do think that any business at the end of the day that has a customer base that it's serving should try and find a way to incorporate some of these elements, even if it's just how do we hear from our community and customers more, even if we don't feel like we can really bring them together.

20:50Yeah, I feel like there's just like a lot of good opportunities to connect with them, especially when it comes like the fitness memberships and all that. Like you join a fitness community. I think I'm talking for personal experience and others like to find a community. And if you can leverage that, especially online to like create that, I think that's just like a huge value add for your own fitness membership community. I don't think I've ever seen a CrossFit commercial, right? But they're all over. Why? Because of their community, their culture. It's so strong. That was a perfect transition to like, oh, I also wanted to ask as well, in your experience in community, you've said like basically 2008, you've been in part of this.