Grow Your Business by Selling More to Current Customers

Research suggests that acquiring new customers is nearly five times more expensive than retaining existing customers.

So, does the key lie in offering superlative customer satisfaction every time so that customers keep coming back?  

Yes, of course. But then, studies have also shown that customer satisfaction never comes with this guarantee because, according to Forbes, nearly 60 to 80 percent of happy customers never make another purchase. Now, this might seem surprising, but the fact is that businesses need solid customer experience consulting and something more to convert first-time buyers into repeat customers. And this is where customer retention management enters the scene.

Why is customer retention significant?

First, what exactly is customer retention? Customer retention is the ability to retain existing customers over the longest period, by keeping them content using various strategies. Through the practice of customer retention management, businesses aim to maximize the average amount spent by each existing customer, which in turn, improves the overall sales and revenues. Retaining more existing customers means greater profit, since they already know your brand and have faith in your brand value. Besides, the whole process takes much less time and is far less complicated. And most importantly, getting new customers is always more expensive, as already mentioned at first.

Existing customers are like the first advocates of a brand, they also play a subtle yet major role in promoting a brand by sharing their experiences and feedback with others. Moreover, they are also the most authentic source of insights about how a company is performing in terms of customer experience; the aspects where it excels, and areas that need improvement.

How to sell more to current customers?

A successful customer retention strategy should be able to capitalize on the profitability of each existing customer. Here are some strategies that should be integrated into the customer retention management policies to sell more to existing customers.

·   Proactive customer closed-loop feedback – The best way to evaluate the customer experience offered by a company is through customer closed loop feedback. Proactively closing the loop on each customer’s feedback, whether negative or positive, makes them feel valued and heard. And nothing works better for a brand than showing that it cares for its customers, and values their opinions. This inevitably turns in happy customers who feel encouraged to make more purchases from the brand.

According to a Frost and Sullivan study, 87 percent of customers think positively about brands that care to follow up with them.

·   Focus on customer experience and engagement – Customer experience consulting experts say that the secret to selling more to existing customers is to understand them accurately. Customer experience is interwoven with how well a brand understands its customers and engages with them. With the right CX strategies, companies can expect to earn 300 percent more revenue from existing customers.

·   Modifications to the loyalty program – A loyalty program is a cost-effective means of gaining the trust of customers and expanding a business. Sharing relevant and informative content from time to time, keeping them updated about the latest developments, and treating customers as more than just profit sources generates a sense of belonging, boosting their loyalty.

·   Flash deals – Attractive deals for a limited time are a tried-and-tested method of generating an urge among existing customers to make more purchases. Many e-commerce platforms are known to have experienced a major boost in sales using this technique. Apps play a crucial role in maximizing this benefit through personalized push notifications to customers, reminding them about products of their choice.

While focusing on selling more to existing customers, brands must avoid promising things (that are practically unachievable), and then failing to deliver them; this is the easiest way to lose customers and brand integrity.

All said and done, it is crucial to first understand whether to focus more on customer acquisition or customer retention, given where the brand stands in its lifecycle. For instance, a newly established company that is gaining traction should ideally focus more on customer acquisition than retention since it needs to expand its business. On the other hand, mature companies should ideally spend about 60 percent of their efforts on customer retention management rather than customer acquisition.

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