4 ways to ease your customer retention woes

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The typical marketer spends her days worrying about acquisition cost, conversion rate, click-through rate, and so on. In other words, customer acquisition takes the lion’s share of most marketers’ time. But did you know that selling to an existing customer is 350% more profitable than selling to a new prospect? (source: Marketing Metrics)

This probably explains why customer retention is now gaining an importance in the marketing universe it never enjoyed before.

The best part? Customer retention does not have to be difficult. You’ve already gotten the customer to buy from you once. As long as their experience with you was a positive one the first time around, you’re well set to build on that first encounter to craft a mutually rewarding relationship with the customer.

How, you ask? Read on.

Data is your best friend

The first step towards customer retention is understanding who is it that you’re trying to retain – at a macro level and at a micro level.

Macro level data could be as basic as whether the customer is a first time buyer, a repeat customer, or a loyal brand advocate. Micro level data gets more interesting and allows you to target customers precisely armed with detailed insights into their position in the purchase cycle. Some examples of micro level data include:

  • Demographic data – age, sex, geographic location, email, phone number
  • Behavioral data – web logs, average session duration, offers clicked on, emails opened, posts liked, pages visited, customer service record
  • Transaction data – number of transactions, average order value (AOV), coupon usage, average margin, top purchased categories
  • Loyalty data – membership number, points earned, points redeemed

You can build deeply targeted campaigns with this type of data. For example, you can have a hyper-targeted campaign for female customers have opened at least two of your past marketing emails, made two or more purchases in the footwear category in the last 60 days, with an AOV of at least $50.

Set goals for your campaigns based on projections using historical data or predictive modeling. Monitor these goals to see how each campaign performs and how close you are to your overall objective of retaining the majority of your existing customers.

Top of mind is top of wallet

It’s easy to get lost in the deluge of customer data that companies collect these days. However, endless planning and modeling are unproductive if the plans are not implemented to their full scope.

Whether you’re a B2B or B2C business, you have a host of ways to reach out to your users to show them how awesome your products are, or remind them of how thrilled they were with their last purchase with you, including email, social media, app notifications, website push notifications, and more. According to data from the Direct Marketing Association, email seems to work best for both B2B and B2C brands for retention as well as conversions. Two for the price of one!

email for retention

Stay on top of your target audience’s mind with relevant communication that reaches them at the right time and with the correct frequency.

There are many schools of thought on the most optimum frequency to send out retention marketing messages to users. These frequencies vary by industry, geography, time of the year, the age of the target demographic, and host of other factors. For instance, many retailers send out daily marketing emails, while SaaS products and other B2Bs like to keep it to a one or two emails a week.

It takes a bit of trial and error to strike that perfect balance of your specific business. Test both engagement rates and conversion rates for emails across different segments to arrive at the golden mean for your own brand.

Once you’ve figured out this critical piece of the puzzle, it’s time to decide what you’re going to say and how.

The how part depends largely on your brand positioning and voice – this includes the colors, imagery and content style that you use for your business across the board. As for the what part, what we discussed in the previous section comes into play here.

Based on the data you’ve gleaned for each user segment or individual user, build and send out automated campaigns like

  • Abandoned cart emails
  • Upsell emails based on past purchases
  • Seasonal emails to customers who shop during sale periods
  • Referral emails
  • Birthday and shopping anniversary emails
  • Minimum order emails (e.g. shop for $20 to get $5 off your purchase)

Make education part of the experience

A happy customer may or may not remember the experience they had shopping with you, but be assured that an angry customer will never forget their bad experience. This is the primary reason why offering a smooth customer experience at every stage of a customer’s shopping journey is essential to retaining them.

Many things go into great user experiences. For brick and mortar businesses, things like a logical, clutter-free store layout, a wide product assortment, helpful store staff, and a quick checkout process, all contribute to a positive user experience. In the case of online businesses (whether ecommerce or not), a simple, easy to navigate website, a well-oiled search function, availability of information about your products or services, quick problem resolutions, and snappy checkout process are integral parts of good UX.

The idea is to offer users assistance in whatever form possible as they navigate down the sales funnel. It could be a relevant case study that pops up as the user browses a product section, a demo video that walks users through the product or even a dedicated e-learning platform that offers users various ways (like whitepapers, webinars, blog posts) to learn more about your product.

CRM stalwart Salesforce takes this piece of advice to heart – they prefer to show how awesome their product is instead of using words to convince customers. From the time you first land on their website to each scroll you take, the focus is on educating, showing, offering proof to you as a potential buyer.




No wonder Salesforce dominates the CRM software market with over 25% of market share.

Give them a reason to return

While a good first experience sets the stage for a possible repeat purchase from you, it’s certainly no guarantee. With the competition out there today, it’s easy to lose a customer to the next guy who offers a deep discount.

What you need is a way to get the user invested in your product and give them compelling reasons to come back and shop with you.

A strong loyalty program is a good way of doing just that.

When a customer shops with you once, enroll them into a loyalty program through which you can then send them tailored offers relevant to their preferences. When customers start accumulating points or getting cashbacks for the mere act of shopping with you, they have an incentive to “earn” more rewards by buying from you over and over again.

Sephora’s Beauty Insider is a prime example of a loyalty program that users actually look forward to joining. Customers earn points each time they shop with Sephora. As the points rack up, they can then be used to get free products at Sephora. Now, who doesn’t like free stuff!


In closing

The topics we discussed above form the core of any retention marketing program worth its salt. If you don’t have a retention or loyalty program yet, get one. If you already have one, implement these principles to see those customers coming back for more, over and over again!

About loriwagoner

Lori Wagoner

Lori Wagoner is an independent content strategist who gives online marketing advice to small businesses. Lori has blogged at Tweak Your Biz, Customer Think, Business2Community, and many other business and tech blogs. Feel free to send her a friend request on Facebook :)


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23rd Aug 2018 18:11

Hi Lori,
Totally agree that selling to an existing customer is 350% more profitable than selling to a new prospect as we don't need to prove ourselves again so whenever you grab a new client, always give your best services to bind them with you forever....

Thanks (0)
24th Aug 2018 21:15

could you write an article specifically on loyalty program? best practice, what kind of data is more valuable, are still useful program with a discount or free product? it makes a customer really more loyal?

Thanks (0)

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