We’ve all had it happen. You see a commercial from your cable company with a great deal on monthly service, so you give them a ring—but then you hear the words, “Sorry, that deal is only for new customers.”
Wait. So, what about me, the person who’s had service with you for years? Talk about feeling left out and unappreciated.
We so often see companies working very hard to acquire new customers. They put out shiny advertisements and offer great deals—anything to get that person through the door and to the cash register.
One customer well taken care of could be more valuable than $10,000 worth of advertising.
But building a sense of community and a sense of reciprocity are important triggers for a feeling of belonging, which is an emotion that is profitable for a brand because it naturally fosters customer retention.
For years, the marketing focus of many companies has been acquisition, and while acquisition is important and is still the best way to quickly grow your business, gaining loyalty with your current customer-base can be just as if not more rewarding than gaining a new customer—and for a much lower cost!
Now, as budgets remain tight and increasing efficiency is ever-important, we’re seeing a sea-change switch to maximizing retention with the people who have already proven they are a good fit for your brand.
Get closer than ever to your customers. So close that you tell them what they need well before they realize it themselves.
Here’s how working on your retention efforts can benefit your business.
It costs between 4 and 10 times to acquire a new customer than retain an existing one
Increasing customer retention rates by 5% increases profits by 25-95%
Up-selling existing customers is simpler and can be more lucrative
It’s one of the best ways to measure how reliably your company is providing its service
Loyal customers can also be a great driver of acquisition through referrals and case study materials you can provide to potential customers
Provides consistent growth and ease of financial planning
Typically require less maintenance
In the business world, you either grow or die. How you choose to grow, whether through acquisition, retention, or some combination thereof is up to you and your business’s specific goals. But the most important thing to remember: when it comes to customers, you get what you give back.