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02.22.17 in Internet Marketing

Customer Retention: Quit Chasing After New Customers

Customer Retention: Quit Chasing After New Customers

The concept of customer retention is heavily under utilized by many marketers. Every business needs customers, but oftentimes find themselves constantly chasing after new customers offering promotions, discounts, markdowns, and the like — but what about your existing customers?

I’m not saying don’t try to attract new customers. I’m saying don’t forget to be loyal to and service the customers you currently have. After all, they are the ones who got you and your business to this point.

Did you know that customer retention is less expensive than to attract a new one?

If you’re spending the bulk of your marketing efforts on attracting new customers instead of on keeping the ones you have, you will eventually alienate or offend those customers who have been with you for a long time.

Ways To Retain Customers

Today’s marketplace is saturated with discounts and special offers. But, when you’re putting together your next marketing campaign don’t forget the people who are already a part of your business growth.

Here are a few ways to retain customers that you can implement now:

  • Customer appreciation promotion – Give your loyal customers a small gift or extra discount on a product or service that is most beneficial to them.
  • Send birthday wishes – Acknowledging your loyal customers on their birthday shows them that you care about them and lets them know that they are not just another transaction. Each year I receive an email goodie from my dentist and a card from my bank on my birthday. It makes me feel so special to know that while they have thousands of patients and customers, I am the number one client for that day.
  • Hand signed note – Send a thank you for being a loyal customer signed note or even a quick phone call may seem like a simple gesture, but customers feel valued when they know you care.
  • Referral program – Unless you have a large budget, this type of program doesn’t have to entail cash payouts or commissions. However, you choose to structure it, not only is your loyal customer rewarded for participation, but they are also promoting your business.
  • VIP Club – This type of offering could be based on your customer’s number of years with your company, reaching a certain purchasing amount; the possibilities are endless. The idea is that once the customer reaches that mark, they are rewarded above and beyond.
  • Project priority – As with most businesses, projects are scheduled at specific times for production. We occasionally get requests that based on our long-time relationship with our clients, we know the desired turnaround time is within a few hours. While this may mean a slightly longer work day, my take on this is that were it not for our loyal clients, there wouldn’t be a work day to extend. Be there for your loyal customers when they need you. This not only increases your business’ retention rate, but it also builds trust.

Many consumers have foregone brand loyalty and instead choose the product or service that has the best price, best value or is easily accessible. If you don’t make loyal customers feel appreciated, you are going to eventually lose them.

Wrapping Up

The long-term profitability of a business that solely relies on attracting new customers is shaky at best. The cost of promotions to attract new customers along with the monetary incentives to lure in new business, profits are usually less than desired. The increase in lack of brand loyalty implies no business has a stronghold on their industry. It’s important to find a balance between customer retention and acquisition. For more insights, check out our marketing funnel infographic.