Source: Ideatick
Businesses invest in various customer acquisition and retention strategies to attract new customers and keep them loyal. They need to boost earnings and see steady customer and financial growth over time. These businesses might be able to build and implement customer strategies for your business by understanding the distinctions between customer acquisition and retention.
Customer Acquisition
The process of gaining new clients is known as customer acquisition. It's when a company or business wishes to attract potential customers through lead generation and different marketing strategies. Customer acquisition is essential for every business as they need customers who will buy their product or service. No business can sustain itself without customers.
According to Invespcro, approximately 44% of businesses put more emphasis on customer acquisition, whereas only 18% concentrate on customer retention.
Customer Retention
Customer retention is the skill of retaining a buyer to keep purchasing from the company. Although it may not be as difficult as it may seem, keeping a customer depends entirely on your customer service level. The only way to retain your customers is to satisfy their needs and wants. When you keep satisfying your customers with your products and services, they will become your long-term customers.
It is proven that if you elevate customer retention by only 5%, your profits increase by 25% to 95%. Customer retention can also reduce your overall business costs.
Customer Acquisition vs Customer Retention
Both customer acquisition and customer retention are equally important. However, for new businesses, customer acquisition is more essential. They need to establish themselves in the market then only they can think about customer retention. They need at least thousands of customers to build trust among your potential target audience.
For established businesses, customer retention is more valuable in the long run. It is better to retain your current customer base so they remain loyal to your brand. It costs at least five times more to gain new customers. Also, the existing customer base is already aware of your products and what you offer. You just need to remind them, "How you and your business have helped them solve their problems throughout the years?"
Source: act.com
Customer acquisition expands your clientele. It goes without saying that without customers, no brand or business can exist. Even established companies can expand their customer base by tapping into untapped markets.
Customer retention on the other hand is when your loyal customers from your existing customer base, consistently purchase from your brand. You can retain them by giving exceptional service and top-notch results. When these customers are satisfied, they will not only purchase repeatedly, but they will also recommend your business.
It is universally proved that 92% of consumers prefer word-of-mouth recommendations from friends, family, or relatives. When your client retention is at its highest, you are more likely to acquire new customers from word-of-mouth marketing. This will automatically result in customer acquisition when you will get new customers without any extra cost.
Businesses can persuade customers to stick with them if they get the best possible service. 34%of consumers will make another purchase if they have a positive customer experience with a business. 2020 (Qualtrics XM Institute)
Three Easy Ways to Boost Sales Through Customer Retention
1. Improve Your Customer Service
Source: LiveAbout
You can engage with your consumers efficiently and offer them the appropriate level of support with the support systems. You can connect with your customers before and after the sale to enhance your customer experience.
Whether a consumer contacts you on-site, via email or through social media, keeping a live chat or help desk tool available can turn their inquiry into a sale or their grievance into a remedy. A complaint or problem can frequently be effectively remedied, converting a dissatisfied client into a devoted, repeat consumer. Not to mention the importance of consumer feedback, which can be used to enhance both your products and customers' overall shopping experiences.
2. Launch a Loyalty Program for Customers
Source: CleverTap
Because they encourage customers to make more frequent purchases to amass significant rewards, loyalty programs are an efficient approach to improve customer retention.
You can start our loyalty program by simply rewarding customers after they have spent a certain amount as Myntra does. By awarding clients welcome points when they open an account, you may encourage them to keep investing in things in the program. They'll be eager to return to your store to complete the rewards once they see how simple it is to do so.
As a result, both you and your consumers win financially from the transaction: they continually receive more value from your store, and you gain from their return business.
3. Sending Engaging Emails to the Customers
Source: RedAlkemi
Email marketing is the foundation of customer engagement. According to Statista (2021), 4 billion people use email every day. By 2025, this figure is projected to increase to 4.6 billion. So, you have to use this effective communication tool.
With the help of emails, you can maintain contact with customers throughout the year. Every message you deliver must improve the experience of your customers. You could perhaps lose them if it doesn't.
Conclusion
The finest asset you have is your current consumer base. These customers are familiar with your brand, and your products and value your services. Instead of constantly seeking new clients, concentrate your time and energy on giving the best customer service, as it will automatically boost sales for your business.
Written by Garima Jain
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