Why do you need to start focusing on retention marketing?
Posted: Mon Dec 23, 2024 4:40 am
According to Client Heartbeat, what is considered a good rate depends on the industry. However, most companies set the target to 90% and higher.
Retention marketing is very profitable as retained customers are very powerful. According to Gartner Group, 80% of a company’s future revenue will come from 20% of their existing customers.
Bain & Co. research found that a 5% increase in customer retention can increase profitability by 75%. Additionally, according to Forbes research, brands that spent more on retention marketing in t cell phone lists for sale he past 1-3 years, had a 200% higher chance of growing their market share.
Why is it so profitable? Let’s break it down…
1. Existing customers are easier to sell to
Customers who have converted and were satisfied already know and trust your brand to be credible and of desired value. Thanks to the relationship and loyalty, you do not need to do as much to attract and educate them as you need for a new customer. They will come to you willingly, without much convincing.
Additionally, due to familiarity with your company, existing customers are more open to upselling and cross-selling efforts, and due to loyalty, they are more resistant to competitors’ sales efforts.
On top of that, you are able to use the customers’ past experiences with the site to send personalized, relevant messages and convince them more effectively. This you are unable to do with new customers.
Retention marketing is very profitable as retained customers are very powerful. According to Gartner Group, 80% of a company’s future revenue will come from 20% of their existing customers.
Bain & Co. research found that a 5% increase in customer retention can increase profitability by 75%. Additionally, according to Forbes research, brands that spent more on retention marketing in t cell phone lists for sale he past 1-3 years, had a 200% higher chance of growing their market share.
Why is it so profitable? Let’s break it down…
1. Existing customers are easier to sell to
Customers who have converted and were satisfied already know and trust your brand to be credible and of desired value. Thanks to the relationship and loyalty, you do not need to do as much to attract and educate them as you need for a new customer. They will come to you willingly, without much convincing.
Additionally, due to familiarity with your company, existing customers are more open to upselling and cross-selling efforts, and due to loyalty, they are more resistant to competitors’ sales efforts.
On top of that, you are able to use the customers’ past experiences with the site to send personalized, relevant messages and convince them more effectively. This you are unable to do with new customers.