Attracting new customers may be rewarding, but it also involves lot more hard work and expense. Whereas most research shows that the costs associated with repeat business are, generally, significantly lower. 70%of companies found it’s cheaper to retain a customer than acquire one, while it’s also been observed that for most companies the cost of acquiring a new customer can be as much as seven times more expensive.
By targeting and servicing existing customers — with appropriate insight of their lifetime value, you’re giving yourself a much stronger chance of making them more loyal and potential up sale. Most customer loyalty research have proven that the probability of converting an existing customer is60 – 70%, whereas the likelihood of converting a new prospect is only 5 – 20%.Your ability of marketing to existing customers with the right response at the right time not only offers a clear reduction in your ad spend, it also presents a chance to demonstrate your commitment to rewarding loyalty , and an easy way to uplift brand recall.
Some simple examples of retention program include things like understanding customer preferences,loyalty, journey map and profile so that you can leverage every customer interaction with personalised offer. They don’t take a great deal of effort, but they do show the customer that you value their experience and can be valuable tools in creating strong, lasting and profitable relationships.
Makes you upsell Faster
It’s often much easier to sell to an existing customer than it is to sell to a new one. This is because all barriers to purchase have already been overcome. Existing customers may just need a slight push to increase your share of their wallet, and significantly speed up your sales process.
The biggest advantage of all is, existing customers already experienced products or services of yourcompany. And if they have a pleasant business experience previously, they are much more likely to make future purchases and generate more business for you. In comparison, persuading potential leads into becoming customers sometimes requires a lot of time and effort, and ultimately, costs more.The bottom line is, If you focus your efforts on awesome customer retention, then you’ll find yourself making quicker sales with easier-to-please customers.
It Better positions your business –
One of the best things about high levels of customer retention is that you’re able to build a more nuanced view of who your customers really are. On one hand, this data is vital to your customer retention efforts and gives you the tools to create personalized response and targeted promotions to maximize your chances of success.
More importantly, such personalised set of information and 360o profile data can evenaid you in your future acquisition efforts; you will know exactly what kind of unique attributes and people are most likely to become loyal customers — who they are, where they hang out online, what motivates them to buy and what kind of messaging they best respond to.
On the contrary, neglecting your customers, will incentivise them to move to competitors. Statistics show 61% of consumers take their business to a competitor when they end a business relationship, which is why retention is a smarter strategy to the success and growth of your business.
By implementing the best possible customer retention plan for your business, you can create differentiation against your competitors. To be honest: who doesn’t want the reputation of being a business that takes care of its customers? And in current situation due to COVID and lockdown, this is the kind of brand profile require to survive and win against competitors.
360O Digital Care can drive Retention–
Customer loyalty is priceless and can even result in further customer acquisition for your company. After all, a social media praise like word of mouth advertising is not only free, but possibly one of the most credible forms of advertising. Customers will always talk, and they will always listen to other customers. It’s because of this that just a 5% increase in customer retention can increase a company’s profitability by 75%.
Statistics like the above prove that if you treat existing customers well, you will consistently reap the benefits. And in today’s digital economy, all you need is the right data driven digital platform and process, that can enable your business to be agile and responsive in delivering autonomous Customer care across every-channel for every interaction. You can even encourage acquisition from the learning of your retention efforts in driving growth.
In Summary –
The more customers you have, the more important retention is. The key statistic to keep in your mind is that 80% of your company’s future revenue will come from just 20% of your existing customers. Improving customer satisfaction drives customer loyalty and advocacy, which boosts follow-on sales and creates cross-and up-selling opportunities.
iFIX understand these requirements and how to tap cyclical multi-components needed to deliver a seamless autonomous customer experience. This process requires a deep understanding of customers preferences and interaction across all channels
Souma Das is one of the Co-founders, CRO and Chief Strategy Officer at iFIX tech Global. He currently focuses on company’s GTM strategy and Global market expansion. Previously, he was Managing Director at Teradata India.