Customer Retention 101: Grow Your Business by Selling More to Current Customers
You’ve heard it time and time again. It’s cheaper to get current customers to make a repeat purchase than it is to find new customers. It’s true for many businesses, especially in the crowded ecommerce arena where clicks and conversions always seem to be increasing in cost.
When was the last time you made an effort to re-engage customers to get them to come back? If you’ve yet to market to current customers after the sale, now is a good time to build a cohesive strategy for customer retention. Let’s look at how to get started.
What is customer retention?
Customer retention is the collection of activities a business uses to increase the number of repeat customers and to increase the profitability of each existing customer.
Customer retention strategies enable you to both provide and extract more value from your existing customer base. You want to ensure the customers you worked so hard to acquire stay with you, have a great customer experience, and continue to get value from your products.
In short, acquisition creates a foundation of customers while your retention strategy is how you build customer relationships and maximize revenue for each one. But how much time and resources should you devote to your retention program? The answer to that depends on your store.
When to focus on customer retention
Whether you should focus more on customer acquisition or retention is heavily influenced by where your store is in its lifecycle. A store that started yesterday is vastly different than one that’s been up and running for many years.
Take a look at the timeline below for general guidance on your store’s potential investment levels.
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