Your marketing shouldn’t stop just because you’ve made a sale. Ideally, your marketing strategy also includes a plan for customer retention and loyalty. This is especially important when you consider the possibility of loyal customers referring new ones to your business.
- It can cost five times as much to attract a new customer than to retain one.
- The probability of selling to an existing customer is 60-70%. The probability of selling to a prospect is 5-20%.
- Existing customers are 31% more likely than prospects to spend more money.
- Referred customers have a 30% higher conversion rate than non-referred customers.
Don’t let your customers slip away. Avoid these mistakes to keep them loyal and grow your business.
5 customer retention mistakes
1. Not being proactive
Customers feel like they’re being paid attention to when you spot their needs before they do. Perhaps you collected information from other customer feedback, completed marketing research or used EDA’s Milestone Watch to keep track of when they might be in the market for new equipment — all of these tactics help you anticipate your customers’ needs. Responding proactively is a perfect recipe for customer retention.
2. Not rewarding loyalty
If your loyal customers feel like an afterthought, they’re more likely to go to a competitor that offers a better experience. Show your customers you appreciate their continuous support by offering customer loyalty programs that pave the way for discounts, free upgrades or even exclusive access to educational content.
If your business follows the 80/20 rule, meaning 80% of your profits come from 20% of your customers, then use account-based marketing to provide an individualized experience to your customers.
3. Not taking full advantage of your market segmentation
Market segmentation is great when guiding prospects to conversion by marketing to them in the most engaging ways. But you can also use it to improve customer retention by offering resources, tools and other educational content based on the different needs your current customers may have in their respective industries. If you’re marketing new products to the portion of your customer base most likely to buy, then you improve engagement and your chances of making a sale.
4. Not giving customer service the resources they need
Customer experience needs to be as consistent as possible in order to build trust and grow loyalty. Marketing automation services and template responses can increase efficiency, but be ready to offer a personalized touch when necessary, such as when responding to complaints or if a customer needs support beyond basic troubleshooting.
Give your employees plenty of resources so they know how to swiftly handle each claim and how to proceed if they can’t. Also, make sure you have enough employees to actually meet your customers’ support needs.
5. Not using social media
Don’t spend every moment promoting a new product or service to your customers. Social media allows you to engage with them without necessarily trying to sell them something. You can promote your brand’s story, customer spotlights and any educational content you have to offer.
Conclusion
It’s not only beneficial but necessary to continue your marketing efforts past the point of purchase so you increase customer retention. Loyal customers spend more money and are easier to sell to than prospects, and the customers they refer have a 30% higher conversion rate than customers who weren’t referred. Grow your business by avoiding customer retention mistakes and improving loyalty.
[For more on this topic, watch our Marketing Minute video on how to get more referrals below or on YouTube.]
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