Customer Retention – Why is it important?

Monday, February 22, 2021
Posted By
Rav Sanghera

Customer retention refers to a company's ability to keep and retain their existing customers. When a business has high customer retention it means that customers are returning to the business to purchase products and or services.  

How to improve customer retention?  

As a business, ensuring customer retention is key, so, how can you ensure you’re putting in place measures that will not only help maintain customers, but also motivate them to return again.

Of course, acquiring new leads is great, but retaining existing customers should be your primary focus. Because several studies found that 68% of sales comes from existing customers.

Firstly, re-evaluate the manner in which you value customer interaction; look into the lifetime value of existing customers and how to reduce the number of “one off customers”. Once you have a better understanding of the value of your customers, you’ll gain better insight into who and what your long-term customers will look like.  

Then, consider a possible restructure of business priorities that fall directly in line with the values of your existing customers. It’s important to have a dedicated marketing strategy for customer retention.

By increasing your customer retention rates by 5% increases profits by 25% to 95% (Harvard Business School).

Types of marketing that can help

Content Marketing

Content marketing that is tailored, tailored to not only your sector, but your client's level of education will help retain their interests. If used correctly, the right tone of language is an important tool to showcase your products, services and brand.  

Content also needs to also be tailored to the platform it’s on. You can’t use the same message for all channels. For example, your followers on Twitter may be less likely to purchase from your brand, but they will like to collab therefore, you can post polls and quizzes to generate interaction.

Conversion Rate Optimisation

Do you have analytics set up on your website? Are you monitoring the data? Analytics are a huge help for any business, especially for those looking to improve customer retention. You can get insight into who your customers are, understand their journey through your website and see where they leave the website or where they spend the most time.

When you find missing pieces within your marketing plan in line with your users' journey, implementing conversion optimisation can rectify those issues and find the possible reason why you are losing sales.

Other marketing strategies that can help:

  • Target customers with special offers
  • Automate emails via trigger-based events
  • Reward your most profitable customers
  • Personalise your follow-ups with clients
  • Have a dedicated CRM system
  • Offer customer service “surprises”
  • Leverage customer feedback surveys

Get your digital marketing strategy in-check with Creative Ideaz!

Start off on the path to success with the right marketing strategy for your business. At Creative Ideaz our goal is to help you be successful online, contact us today and let's get one step closer to achieving your goals

Customer retention refers to a company's ability to keep and retain their existing customers. When a business has high customer retention it means that customers are returning to the business to purchase products and or services.  

Rav Sanghera

UX Researcher @ Creative Ideaz