Attracting customers is the lifeblood of any company’s success. Big budgets and heavy marketing artillery are allocated towards this goal. A lot of time is dedicated to figuring out acquisition tactics.
However, what must not be overlooked is that cultivating customer loyalty also has a profound impact on the bottom line. In fact, it is easily one of the best strategies to accelerate growth and make strides towards the forefront of the industry. After all, long-term customers add much more value to your business than single-deal ones.
If you possess appropriate resources, enticing someone to make a one-time purchase is not too hard. On the other hand, prompting people to stay with you and inspire loyalty in them is an entirely different ballgame. It takes a lot of time and requires you to invest a great deal of work. The rewards that lie down the road are too big and opulent to be missed or overlooked.
The math may seem odd to some, but it has been proven: Improving your retention rates by just 5% can increase the profits by 25-95%. Thus, the return on investment (ROI) is impressive, and it is not hard to understand why. Loyal customers feel comfortable making frequent purchases, and they tend to become larger and larger as the time rolls by.
This allows you to tap into the stream of repeat purchases and elevate your organization. This kind of revenue base is more profitable, but also far more predictable.
Another great thing about retention is that the costs are much lower than the cost of acquiring a customer. Believe it or not, on average, acquisition costs around 30 times more. Taking into account these findings, we become aware that it makes so much financial sense to focus on building meaningful relationships with your customers.
Sowing the seeds of loyalty
There are many things you can do to nurture customer loyalty and turn people into long-haul partners and brand ambassadors. It all starts with thorough market research, the bedrock of getting to know consumer wants and needs. Next, you need to use gathered insights to put a solid after-sales service strategy in place.
It can encompass everything from sending birthday gifts and emails to offering coupons and discounts. So, do a follow-up whenever someone expresses interest or purchases your product and service. Make sure to ramp up your remarketing efforts. Launch creative loyalty programs that add value to the life of the customers. Never make promises you are not able to keep.
Furthermore, take your customer service to the next level. Embrace a holistic approach and realize that everyone in your company is responsible for putting the best face forward. Offer consistent experience across all touch points and make certain that all departments are working hand in hand towards maintaining good public relations. Train your staff accordingly and formulate clear expectations and policies.
Note that apart from the optimal buying experience, marketing has a big role to play. If you lack the expertise, don’t hesitate to hire professionals to handle some aspects of your marketing and branding. There is an innovative brand agency from Melbourne helping various businesses take off and boost their visibility. But, regardless of where you are, it should be possible to acquire professional aid locally or by outsourcing online.
Reaping the benefits
A shift of focus towards retention leads to more optimal resource allocation. You are in a position to keep the spending in check and achieve significant savings in the long-term. Of course, you can then use the money where it’s needed the most and make a real difference. In addition, having devoted brand ambassadors to back you has an incredible effect on your image and brand.
Namely, word-of-mouth promotion is something that allows you to stand out and attract new customers without employing expensive marketing tools. Studies have confirmed that modern consumers highly trust customer reviews and testimonials. Therefore, maintaining long-term relations is one of the best demonstrations that you care about your customers and provide a great customer service experience. Others will start wondering what it is that you have in store.
The list of benefits goes on, but by now, you should be convinced about the importance of customer retention. However, nobody is saying you should forsake customer acquisition strategies. On the contrary, keep it one of the staple elements of your success formula.
That being said, in this day and age, keeping your fingers on the pulse of your existing customer base is not optional: It’s the name of the business game.
A force to be reckoned with
Attracting new customers is important, but retaining them is something else. It’s a potent strategy that calls for a long-term perspective and commitment. You need to lay the foundations of lasting trust and loyalty.
Look beyond immediate avail and profit. There is a lot of evidence that shows that repeat purchases coming from loyal customers can account for the lion’s share of the revenue and serve as a driving force behind the business growth and expansion.
So, make sticking to your offerings worth it and rewarding for customers. Set yourself apart from the competition and lure people out of their camp. The good word travels fast, far, and wide, and brand awareness follows in its wake.
Dan Radak is a marketing professional with eleven years of experience. He is currently working with some companies in the field of digital marketing, closely collaborating with a couple of e-commerce companies. He is also a coauthor on several technology websites and a regular contributor to Technivorz.