The importance of Customer Retention
It is crucial for a company to make itself known and find new customers, but even more important is to keep existing customers happy and keep buying. In other words, it is very important to build customer loyalty and increase customer retention.
The fundamental role of customer retention has in fact been demonstrated by several studies. In particular, the main benefits can be summarised as:
- Reduced costs: According to the Harvard Business Review, acquiring new customers is up to 25 times more expensive than retaining existing customers.
- Increased profits: : A study by Bain and Co. shows that increased customer retention is reflected in increased profits ranging from 25 to 95 percent.
- Increased average spenda: Existing customers are not only more likely to make a purchase, they are 33% more likely to have an average receipt than a new customer.
Already acquired customers therefore require less effort and offer greater returns. In addition, a brand-loyal customer is more likely to speak well of the brand in their circle of friends, creating a positive word-of-mouth that often has more impact than advertising, as we tend to trust the opinion of other consumers more than the media.
It is therefore clear that it is essential for brands to nurture and strengthen the relationship with existing customers. But how to do this and what strategies to implement?
Specifically, building customer loyalty means:
- Give them good reasons to frequently get back in touch with the brand and its communication channels
- Go beyond just selling the product and provide customers with interesting content that is in line with their lifestyle and brand philosophy
- Establish a dialogue with your customers, providing insights and interpreting their tastes and needs to keep your offering engaging
The secret is to apply these principles consistently and continuously. A valuable support comes from content marketing, understood as the use of quality content to educate, amuse, inform and entertain existing customers.
Here are some simple ideas that brands can put into practice by combining content marketing and online communication:
Share content to entertain and create engagement, such as posts, photos and videos. Find creative ways to reward customers, for example by setting up contests and sweepstakes. The social media that lend themselves most to this are Instagram and Facebook.
Provide a community for customers to meet and exchange ideas. Use social channels such as Facebook to ask questions and stimulate conversation with consumers through posts or surveys. This strategy is useful not only to establish a dialogue with customers, but also to understand their tastes and needs and keep the offer interesting.
Customer service is a key factor in customer retention, and in 2018 it is expected to be one of the best strategies to differentiate yourself from your competitors. It is therefore essential to provide customers with useful support tools. One idea is to publish “how-to” posts on the company’s website, Facebook page or LinkedIn, or include easily downloadable video tutorials and manuals.
Personalising the user experience
The data held by the company can be used to customise the experience of each user. Examples include a special birthday greeting, specially designed events, personalised shopping experiences or free training. In this way, customers will feel valued and happy.
In light of the above, and bearing in mind that in 2020 the customer experience will be a determining factor for sales and revenues, customer retention through content marketing becomes a challenge that no company can avoid.