Customer retention should be the goal of all businesses because happy, loyal customers and clients play a significant role in the growth of your business in the long-term.
What is customer retention?
Customer retention means implementing effective techniques and strategies that build a relationship between you and your customer so that when they need the products and services that you provide, they will think of you first. You’ve created a top-of-mind awareness and built strong customer relationships so they’ll want to keep doing business with you.
Customer retention in closely tied in with customer loyalty, which is an ongoing relationship that exists between your business and your customer on the basis of excellent customer service and a WOW experience. It also means providing the environment for your customers so that they want to stay and continue doing business with you, and not just because they have to, perhaps because of being locked into a contract.
Why is customer retention important?
- Having loyal customers and clients who are repeat buyers allow you to make fairly accurate sales and marketing forecasts
- According to a Gartner Group Study, 80% of a company’s future profits will come from just 20% of their EXISTING customers.
- It provides a measure of stability for employees, if any, as it eliminates the ‘feast and famine’ syndrome many companies experience. At the same time employees who work in an unstable environment undergo more stress as they worry about job security. This can, in turn, affect their performance so that they do not deliver the high level of customer service they’re expected to give.
- Acquisition costs far outweigh retention costs. It’s widely held that attracting a new customer coasts 5 times as much as keeping an existing one. It will only get worse and the disparity will continue to increase as customers and potential customers have more choices and more methods of acquiring goods and services in this digital age.
There are more reasons why businesses should strive for customer retention and many of these are outlined in the FREE Special Report, “Time-Tested-Tips for Customer Retention.” Take some time to browse through the report and make note of five things you may not be doing, or not doing on a consistent basis and make the decision to start implementing them immediately in your own business.