Customer retention and acquisition are essential marketing strategies that can increase sales and maximize profits. Although many businesses tend to focus on customer acquisition, retention strategy is cheaper and allows companies to deliver delightful customer experiences.
Moreover, your older customers are 50% more likely to try a new product than new prospects. What’s more, they’ll even spend up to 30% more than new customers. On the other hand, customer acquisition strategies help increase brand awareness.
Generally, all these strategies can stimulate business growth, but which one works better? Should you spend more money on acquiring new customers or retaining old clients?
This article highlights the importance of customer retention strategies.
1. Customer Retention Is Profitable
Although the customer retention rate in the industry is low, this strategy is more profitable than acquisition. Focusing on loyal customers can help you get more referrals by word of mouth. You can also get direct leads from positive customer reviews on various consumer sites.
While loyal customers will always talk about your business, that one-time customer will likely forget about it after checkout. A marketing strategy that guarantees you more direct referrals is more profitable in the long haul.
2. Loyal Customers Explore Your Brand
Loyal clients will explore your brand more than new customers. These consumers have an ongoing relationship with your business. What’s more, they trust whatever product or service you have to offer.
This level of trust means more repeat purchases. Moreover, loyal customers also don’t have a problem exploring product and service upgrades.
3. Customer Retention Improves Brand Image
Customer retention examples such as satisfactory customer service can help improve brand image. A positive brand image can help a business in many ways, including new customer acquisition. It can also help in cross-sell and upsell to reduce marketing costs.
Remember, customer retention gives you an idea of who the typical customer is. This way, you know the relevant data to collect for building a buyer persona. Then, you can use this information to enhance the experience of individual buyers.
4. Identifying Company Policy Flaws
Besides your business partners, loyal customers make the best sounding board for rectifying flaws in company policies and procedures. Unlike new customers, loyal customers know a better way of communicating their frustrations.
They’ll write emails, make calls, or even better, visit the business premises in person. On the other hand, new customers will vent out their frustrations on any online platform they come across.
A customer who reports bad experiences using the right channels can help you revisit your policies to enhance the experience of others.
5. Preparing for Future Customer Needs
The best way of understanding the future needs of your customer is by working closely with them. Customer retention marketing trends can help you build a loyal client base that speaks to you about your business. This means they’ll always tell you if they need any future improvements.
Besides listening to the needs of your loyal customers, you can also track their engagement metrics. This will help you monitor emerging trends and gauge their expectations.
Customer Retention Is the Way to Go in Today’s Competitive Marketing Industry
It’s difficult to differentiate brands from their competitors since nearly every company focuses on acquisition. Customer retention helps your business stand out.
Moreover, loyal customers are as important as new ones. They have to be part of your company’s growth.
Contact us today to speak to a customer retention specialist and unlock your business’ growth potential.