Benefits of Customer Retention

A general thought widely accepted among business circles is that a good product is what you need to keep your customer base intact. Some finding indicate that the strongest reason for customers (68% of them) to leave is when they believe you don’t care about them. This calls for a deep study of customer retention strategies that help do two things. First, identify and sell more products to those who are more likely to stick with the company. And second, strategize on how to boost customer retention for those who are more likely to shift their loyalties. This article throws light on the 3 reasons why caring for your customers and building long-lasting relationships can be a mutually beneficial association. 

Reduced marketing costs

Marketing costs account for a considerable share in the overall customer retention costs. Reducing this aspect means that you will utilize less time and effort to convince customers that your products are the best in the market. Studies suggest that acquiring a new customer is 16 times more expensive than cultivating the loyalty of an existing customer.

Improved conversion rate

Once you have developed a long-lasting relationship with your customers, it’s easy to up sell. Consider the following example. You sell high-end computers. You are looking to expand your business and also sell expensive RAMs. You search your database and find the names of those customers who own a gaming laptop. You send them an email detailing the features of the new RAM and how it can improve their gaming experience. If your customers have had a wonderful experience with their laptops, there is a high chance that they may purchase the new RAM too. But the same does not hold for new customers. This is because you haven’t established the same level of trust with them. Thus, building trust is a sure shot way to boost customer retention.

You get instant and worthy feedback

Feedback is one of the most important customer retention strategies. It helps to know what the customer thinks about your products and services. This provides you a chance to correct your mistakes, understand their likes and dislikes, know what they want and what they don’t, and get a hint of whether they are planning to purchase your competitor’s products. 

Framing unique customer retention strategies is the need of the hour. A big customer base ensures that you have regular cash flow. And a long-lasting customer relationship guarantees that you will have to spend less on marketing. This is where we can help. At Sage Software Solutions Pvt. Ltd. we are home to a world-class CRM system that will allow you to frame excellent customer retention strategies to increase customer stickiness.

Disclaimer: All the information, views and opinions expressed in this blog are those of the authors and their respective web sources and in no way reflect the principles, views or objectives of Sage Software Solutions (P) Ltd.