Building a successful business goes beyond gaining new consumers. Customer retention is also necessary.
New customers are essential for business. But, what’s the point of acquiring new consumers if you don’t know how to retain them?
The more loyal consumers you have, the faster you can achieve your business goals.
Companies that increase customer retention rates by as low as 5% get an increase in their profits by 25-95%. So, how can you retain your existing consumers to grow your business?
Keep reading to find out:
- Why you need to focus more on customer retention than acquisition
- Why your existing consumers matter
- Six powerful customer retention strategies to grow your business
The Differences Between Customer Retention and Customer Acquisition
Customer retention is the act of keeping your current consumers. Being able to hold on to customers will increase your sales and profit.
Customer acquisition involves the processes you put in place to bring new consumers on board, and it comes first when growing your business. The next step is to set up customer retention strategies to encourage your existing customers to make repeat purchases.
As you acquire new customers, it is crucial to develop ways to ensure they stay with you and become a loyal audience to your business.
However, your business’s growth phase and marketing goals will determine whether you should focus more on customer acquisition or retention.
It will be easier for an established company to leverage its customer base than a startup with only a few consumers.
Why Your Existing Customers Are Important
The guide Marketing Metrics explains you only have a 5-20% chance of selling to new buyers, but a 60-70% chance of selling to your existing customers.
Acquiring new consumers is five to 25 times costlier than retaining your existing customers. Leveraging your current customer base is a simpler way to increase your profits than marketing to new prospects.
It’s vital to keep the customers you invested time, money, and effort to acquire.
6 Powerful Customer Retention Strategies To Grow Your Business
Here are six strategies you can apply to retain your existing customers and turn them into loyal, repeat buyers.
1. Focus on Creating a Positive Customer Experience
The service and experience a customer has during a purchase will determine whether or not they’ll continue to support your business.
Provide excellent, efficient customer service. Ensure the processes your consumers go through are as seamless as possible. Customers will remember and patronize companies that treat them well.
2. Implement Customer Loyalty Programs
Customer loyalty programs are also called retention programs because they are effectively used to increase purchase frequency.
Create loyalty programs to encourage your consumers to make repeat purchases in exchange for rewards. You can start by directing them to create customer accounts.
3. Stay in Touch
Keeping in touch with your existing customers keeps you top of mind. Constantly reach out to your consumers through email.
Email is an effective tool for marketing and retention. Use it to build positive relationships with your customers.
You can send outreach emails for special offers, product or service updates, birthday greetings, or just to say hello to your consumers.
4. Appreciate Your Repeat Customers
You have competitors, and your customers can always decide to switch over to them. But being thankful to your audience will make you stand out.
Appreciation goes a long way in retaining your existing consumers. Thanking them for choosing your brand shows you value them and appreciate their purchases.
Displaying gratitude can be as simple as sending thank you notes or giving rewards such as gifts, special discounts, free products, and special offers.
A shout-out to your customers on social media is also a great way to show you appreciate them.
5. Ask for Feedback
Many businesses lose resources when they don’t listen to their customers. It’s always a good move to ask for your consumers’ opinion. Let them know how much their thoughts matter to your company.
Don’t just focus on marketing your products and assume that will solve customers’ problems. Reach out to your consumers to find out what they need solutions for and how you can help them.
6. Build Strong Employee Loyalty
Employee loyalty determines customer retention rate. The happier your employees are, the more satisfied your customers will be.
Ensure your employees have the resources they need to perform efficiently. Acknowledge and give praise when they do their jobs well.
When people receive compliments for performing specific actions, they are more likely to repeat them.
Onboarding new consumers is essential. However, customer retention is even more important. It’s how you ensure your new and existing customers become loyal and continue to support your business.
Competition is high, and companies that know how to keep their existing customers happy are at the forefront of success. Build a reliable website that supports your customer acquisition and retention strategies. Check out Bluehost’s hosting plans today.