Why Your Current Customers are Your Best Customers
A common business development objective is expanding the customer base, which is certainly a worthwhile and necessary task for a business to succeed and grow. But there’s another side to the coin, and that’s customer retention. If you’re so focused on new customers that you’re losing existing customers, that’s a bad trade-off. And yet, 44% of companies focus more on acquisition, and only 18% put retention first.
This disparity takes on another angle when you look at it from a financial standpoint. Not only does it cost anywhere from 6-7 times as much to acquire a new customer than it does to retain them, not making retention a priority also opens the door to a lot of potential revenue loss. Research indicates that companies are losing $35.3 billion annually due to customer churn.
Now, for the good news: existing customers are very good for business. Consider that a 5% increase in customer retention can increase profits as much as 95%.
That’s because loyal customers are:
- 5x as likely to repurchase products
- 5x as likely to forgive if your company makes an error
- 4x as likely to refer other customers
- 7x as likely to try a new product
All this good will can add up to a nice bottom line.
As with any marketing strategy, an effective plan for customer retention requires an omni-channel approach that focuses on customer experience. Customers want to feel heard and valued, and adding a personal touch can increase consumer spending up to 500%. Websites and e-mail campaigns are high on the list of tactics companies find effective from a digital standpoint, and direct mail is an effective print option.
Transactional communications are excellent channels for customer retention. In addition to being necessary tactics to expedite payments and ensure revenue, they also offer a platform to place targeted messages that are guaranteed to be read. Whether it’s a special product offer just for customers or a thank you message, these pieces are prime real estate and shouldn’t be left unused.
At Matrix, we can help you put together an effective communications program to ensure your customers feel important. In addition to being transactional mail experts, we can provide document and data processing, mailing, printing, postage and information services to some of the most demanding markets in a wide variety of industries across North America. With full-service printing facilities and proprietary technology resources, Matrix is the preferred vendor for direct mail, e-solutions and transactional mail.
Where do your existing customers fit into your marketing approach? We can help you protect that business by creating tailored campaigns that put your customers first. Contact us today to get started.