Why is it that we spend money on customer acquisition marketing when customer retention marketing works so much better? I think we’ll all agree that customers are the most important part of any business. Without them, there would be no business.
So then why do we continue to spend most of our marketing dollars on finding new customers instead of nurturing the ones we already have? Don’t get me wrong, we need new customers but not at the expense of the ones we already have, right? It’s an age-old question I know, but one worth revisiting as we are thinking about our 2014 plans.
To set the stage, here are some interesting findings from Small Business Marketing Strategies blog:
The cost of customer acquisition versus customer retention could reach as high as 700%, according to a report by Frederick Reichheld of Bain & Company as below:
- Acquiring a new customer can cost 6 to 7 times more than retaining an existing customer
- Over a 5 year period customer attrition rates could reach as high as 50%
- Businesses which boosted customer retention rates by as little as 5% saw increases in their profits ranging from 5% to a whopping 95%.
Now I think we can all agree there’s some opportunity here to re-focus more on our existing customers, rather than chasing down new ones. By simply automating the process of content marketing, email marketing, and social media marketing, you have huge success…
- Staying in touch with your current customer base.
- Reminding their customers of upcoming events and seasonal tips.
- Maintaining a professional appearance all the way to the inbox.
- Taking advantage of opportunities to reach out to clients you have not talked to in years.
- Get a few more referrals sent your way.