How to increase retention rate with animated video in 2023: tips and insights

The usage of animated video has become increasingly popular in the last few years, and as pioneers of this beautiful medium in modern times, we can say that this tendency is not going to stop. We have been in the animation industry for over a decade, and never we saw such popularity of animation in the area of marketing and advertising.

In 2023, this trend is expected to continue, with more businesses looking for ways to capture their viewers’ attention and increase their retention rates. The only difference is that we will all see a lot of new, even more creative ways to win a customer. That’s no wonder: the use of animated video is an effective way to increase retention rate and engage customers in the long run.

We expect to see the good old story told us once again: the use of animation for marketing and product promotion. Why? Apparently, the animation is too powerful to ignore. This article will provide tips and insights on how to effectively utilize animation in order to increase customer retention rates.

We will consider different types of animation, their potential impact on customer engagement, as well as best practices when using animated videos for marketing. Are you ready? Wait… Let’s talk numbers first.

Studies have shown that including a 5% improvement in retention can dramatically increase your business’s profits. How much? From 25 to 95%!  The power of animated product videos can speak for itself if you will turn to the language of numbers: the use of animated videos as a marketing tool increased from 81% in 2018 to 87% in 2019. Word to marketers: 83% claim that animated customer testimonial videos have a good return on initial capital investment or ROI. 64% of customers confess to making a purchase after watching corporate videos.

How to win a customer with your animated video?

Many companies already recognize the potential of animated video, leading to an influx of brand-created and user-generated animated content as an effective form of communication. There’s an avalanche: companies started to plan and strategize how to leverage the potential of animation to boost their business. You know, we can’t stay aside from it.

“One necessary component of developing sound strategies is knowing your customer retention rate or CRR. Your CRR represents the percentage of existing customers your company successfully retains over a specific window. Calculate your customer retention rate using the formula CRR = [(E-N)/S] x 100.

“S” refers to your starting customers, and “E” represents the number of customers you have at the end of the period in question. Meanwhile, “N” stands for the number of new customers gained during this period. For instance, If a company began the year with 80 customers, added 20 new customers, and ended the year with 60 customers, the calculation would look like [(60 – 20)/80] x 100. Its CRR would be 50%.

Smaller businesses typically aim for a CRR rate of at least 20%. Meanwhile, a major insurance or media company would expect its CRR to stay above 79%. Once you know your customer retention rate, developing long-term strategies to increase its percentage becomes easier”. Toni Matthews-El, Forbes contributor

Focus on Narrative. At its core, animation is about telling a narrative story that captures the attention of the viewer and encourages them to stick around to find out the ending. Even if your video doesn’t feature characters, providing a clear narrative structure and engaging with viewers’ emotions and interests can help increase the retention rate.

Customer reviews. These days, it is the most efficient way to create trust. Where is trust, there is better retention. Here is the thing: people speak about their experience in certain areas all the time. A customer always wants to know about other people’s impression of the company they are about to deal with. So, if your customers are not leaving reviews, and you are okay with that…well, don’t be. This is where you should be changing your attitude: encourage your customers to leave reviews and wrap it up in a simple animated video. Why not?

Optimize for Mobile and Social Platforms. An animation that performs well on mobile devices and social media platforms can help to further increase viewership and, in turn, improve retention rate. Don’t forget about that. This is a rookie mistake mostly, but sometimes even experienced ones can make it.

Engage Employees. Employees can be your greatest asset in any marketing effort. Allowing them to engage with the animation through a contest or challenge, or having it feature in company-wide newsletters, can help increase engagement and therefore retention rate.

Invest in Quality. Investing in professional voice-over actors and illustrators will ensure your animation is visually appealing, free of errors, and memorable.

Use Gamification. Gamification is a vital customer retention strategy that will help them to be more engaged with your product. Gamification+animation can be a winning combination. Through the fun of gamified features, you can transform their experience into a real adventure. 

Use the power of simple explanations. This is something inherent to animated videos. Nothing can explain Blockchain in a few moving images better than animated video.

“It is easy to assume that having the best product on the market automatically assures dominance, but this is not necessarily true. A rival company may outsell your business with an inferior product because customers find their explanations and marketing materials easier to understand.

Ultimately, the more accessible you make the nature of your business, the faster they can decide if they want to shop with you. A convoluted, over-explanation may drive shoppers away, while those who know precisely that your business serves their needs will feel more comfortable buying from you again and again.” Toni Matthews-El, Forbes contributor

Videos on FAQs. Utilizing 3d animated explainer videos to give people fun, engaging, and detailed answers to their inquiries.

Use AI to simplify the whole process. Many people are not very happy with AI these days, and about the same amount are extremely excited about it. What can we say? Use our insights to include AI in a creative process. Animation can be a powerful tool for increasing the retention rate in 2023. By following these tips and insights, companies can create effective and entertaining animated videos from concept to completion, that have the potential to engage and captivate their audience. But…

Keeping retention rate high before you kick in with your animated video. Before you create your cool animated video – which we can help you with, just ask! – you have to prepare a foundation for it. We recommend looking at customer churn rate. What is that? It is a metric that measures the percentage of customers who decided to break up with a company in a particular period. It can be measured by month, quarter, or year. By the by, at this thing also take a look lots of investors. Why do we say this? The important thing is to analyse.

“If I’m interested in keeping customers, I’m interested in understanding how many leave and the underlying reasons why they are ending their relationship with me. Changes in a company’s churn rate could be a signal that something is working well (if the number goes down) or needs addressing (if the number goes up).

The idea is that when you know that more customers or subscribers are cutting ties with your firm, you can work to adjust your marketing strategy or customer service approach. Looking at churn rates by customer segment illuminates which types of customers are at risk and which may require an intervention. It’s a nice, simple metric that tells us a lot about when and how to interact with customers” 

Jill Avery, a senior lecturer at Harvard Business School and an author of HBR’s Go To Market Tools

What else can you do?

Word-of-mouth is a new testimony. Sounds like a point we already have covered. But actually, no. If there is a proper word-of-mouth discussion about your products, customers will be paying attention to you. Create a domino effect of retained customers because one happy customer can bring you more people.

Share positive feedback from customers through retweets on Twitter, or encourage customers to share their thoughts on their pages. Remember that testimonials should be way ahead of that part on your site where you put them: they should be on people’s social media, so others can see that, too.

Monitor discussions about your brand and get into that.  Your animated videos have to be present online, but also have to create a certain buzz. Your goal is to find where people are talking about your brand and get into that discussion. Fun? Maybe. But it will be definitely very efficient.

Ask for feedback. Let people talk about their experience with your product. This is a part of feedback culture: giving your customers a space to share their impressions and opinion with you.

Maintain a customer communication calendar. Don’t forget that you have sometimes to re-establish your relationship with the customers. Consider creating a communication calendar just to keep track of customer communication. How does it work? You will be able to see the last time that a customer has reached out and notice when existing customers remain silent. Thus, you will be able to incorporate new activities and launch more interaction-causing reasons.

Apologize when you make mistakes. As simple as that. People value it when we can admit a mistake and say sorry for that. This is actually a way of handling it. If you make mistakes in business communication, it is vital to learn how to handle them. Remember that it can be extremely easy.

Create a personalized approach. People want to feel special. That’s normal today when we see so much of identical approaches. So, leverage personalization in your approaches to customers or prospects.

Conclusion

As we all know, customer retention is one of the most important aspects of any business. But how can you be sure that your customers will stay with you? One way is by using animated videos as part of your marketing strategy. As businesses become more competitive, customer retention is a key factor in success.

Companies must find creative ways to engage their customers and keep them coming back. Animation is a great tool to capture attention, communicate complex ideas, and increase customer retention. Keep in mind that you can always come to Darvideo animation studio for the perfectly tailored creative decision for your endeavors.  That’s it!