A study, conducted by Bain & Company, along with the Harvard Business School, shows that, “Increasing customer retention rates by 5% increases profits by 25% to 95%.” The study reveals some other notable facts about customer retention:
- [inlinetweet prefix=”” tweeter=”” suffix=””]Customers are likely to spend more money with companies they’ve already done business with[/inlinetweet]
- [inlinetweet prefix=”” tweeter=”” suffix=””]Average consumers are likely to refer three other people to a site after just one purchase[/inlinetweet]
- [inlinetweet prefix=”” tweeter=”” suffix=””]Businesses need to retain customers for at least 12 to 18 months to break even on their investment[/inlinetweet]
Gartner Group projects that, “[inlinetweet prefix=”” tweeter=”” suffix=””]80% of future profits come from just 20% of your existing customers[/inlinetweet],” and Marketing Metrics has found that, “The probability of converting an existing customer is 60%-70%, while the probability of converting a new prospect is only 5%-20%.”
According to software company Client Heartbeat, “Companies are finding that customer profitability tends to increase over the life of a retained customer, so employing customer retention strategies is a worthwhile use of company resources.”
Here are some customer retention strategies that you can get onboard with;
Insight:
Talking about the importance of customers versus actually executing customer centric strategies are still far apart for some brands/organizations. While you may think that you are customer centric your customer service front line people are the ones who are the face and sound of your brand. They have to be treated well and you have to invest in them as valuable employees.
