A while ago, a German „Marketing expert“ embarrassed himself by writing about his secret trick to gain more followers on Facebook. His solution: simply buy a few hundred thousand followers, after all, they hardly cost anything.
To his surprise, the comment section was not filled with praise and adoration but with mockery and pity. After all, buying likes, followers or basically any customer interaction without targeting and smart content, is one of the big sins of Social Media marketing.
Instead of gaining new followers who would interact, suggest his page to their friends and become loyal customers, he had simply thrown out his money by buying hollow clicks without any intention turning them into buyers. His KPIs might have looked good, but the results (e.g. revenue) would be dire.
Customer acquisition: less is more
Unfortunately, our „expert“ is not the only one within the fields of marketing. There’s still a lot of marketers out there who think that numbers are more important than results. But if the newly acquired leads (or customers) don’t show any actual interest in the company, these numbers are useless. Besides, if marketers are still solely focused on new acquisitions, they ignore the powerful group of existing customers and retention strategies to keep them (happy).
What is retention?
„Retention“ describes the strategies and processes of a company to keep customers loyal after their initial purchase instead of treating them like a new acquisition right after the customer lifecycle is „over“.
Retention strategies include personalized communication, loyalty programs and other advantages.
Customer loyalty statistics
According to a recent study by Bain & Co, an increase of customer retention by only 5% can already boost profits by 25% and more (source: via Visioncritical.com).
A study by software company Rosetta suggests, that customer engagement drives customer loyalty more than anything else. Even more so, they deliver three times the value invested in them to the brand over the course of a year (source: rosetta.com).
Rosetta continues that loyal and engaged customers buy more frequently, spend more per transaction and are more likely to remain true to a single brand.
But how do you gain these wonderful loyal customers? It’s actually quite simple: create a satisfying customer experience.
4 ways creating customer retention
Many companies treat their customers like kings up until the purchase. As soon as the customer has paid, the king becomes a pauper (or so it seems, looking at many horrendous reviews on after salesservices). Whether it’s poor support, lack of communication or problems with the product – customers want more service and hardly get it.
Customer service is a staple for a customer-centric company. Only two negative experiences can turn a loyal customer into a leaving customer. However, when problems can be solved in a timely, efficient and satisfactory manner, customers will pay it back by staying loyal.
Communication with returning customers is oftentimes lacking. Loyal customers are already convinced of the virtues of the company’s products, they don’t need a pitch. What they need is personalized information (or content) that fits their needs and interests or attractive offers proving the company knows their loyal customers.
Using customer data
Speaking of knowing your loyal customers: one of the biggest advantages of loyalty is the fact that you, as a company, know your customers. Instead of trying to find out more about their interests, you already know what they like, what they loathe and what they need.
The customer data of any loyal customer is full of information on his interests, behavior and individual references that tells you more about them, but also about your strategies and communication efforts.
Using customer journey management
Find out how you can implement and use Customer Journey Management in your company.
https://www.ec4u.com/ec4u-blog/wp-content/uploads/sites/3/2017/10/Bond_congerdesign_Pixaby.jpg269710Juliane Waackhttps://www.ec4u.com/ec4u-blog/wp-content/uploads/sites/3/2016/02/Logo-ohne-Schriftzug.pngJuliane Waack2017-10-26 09:00:182020-08-31 14:53:07Customer loyalty: why retention is important