Acquiring new customers is expensive and time-consuming. In fact, research shows that attracting new customers is 5X more expensive than keeping your existing customers. So, If you want to increase your profits, you need to focus more on your existing customers.
The more customers that you can keep and continue to sell to, the more likely you are to achieve your business goals and increase your profits.
Why Looking After existing Customers Will Increase Your Profits?
Better conversion rates. Existing customers have already bought from you, so unless they had a disappointing experience, they will buy from you again.
Loyal customers spread the word. Your customers are your best assets. They’re the ones who will provide social proof for your marketing, and they’re the ones who will vouch for the quality of our products.
They spend more. Selling to existing customers is less focused on price, as opposed to selling to new customers. And since your existing customers trust you already, it gets easier to convince them to become interested in even more of your products or services through up-selling and cross-selling.
Lower costs. It’s 5-25 times more expensive to acquire a new customer than it is to retain an existing customer.
When was the last time you looked at your customer journey map for opportunities 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 business strategy for customer retention.
So instead of simply focusing on expanding your customer database, here are 5 simple things you can do to increase your profits immediately:
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Strategies to Boost Customer Retention and Increase Your Profits!
1. Improve Your Customer Engagement
Engaging with your customer is much more than a simple ‘welcome message’. Customers want to feel loved and appreciated. They need to feel that if there is a problem, it will be handled confidently.
How often do you engage with your customer? If it is only during your transaction you are not really engaging your customer.
– Are you updating them on new products or services?
– Do you invite them to stay in touch and perhaps share their experience with others?
– Do you offer competitions to make them feel valued?
– Do you stay in their minds by keeping in contact with them?
– Do you have a weekly or monthly newsletter?
2. Upsell and Cross-Sell
Existing customers offer great opportunities for upsells and cross-sells. You’ve already gone over the biggest hurdle, which is the initial buy. You’ve established trust and started a relationship, and the customer has formed an opinion about your business. Now, it’s time to ask, “What else can I do for you?”
3. Create a Loyalty Program
Selling to existing customers becomes easier when customers feel appreciated. By offering a reward for choosing your business, you gain more loyal customers.
This strategy gives your existing customers an incentive to spend more money since they know they’ll be rewarded. As a result, it will be much easier to retain these customers.
4. Make it Memorable
There is a clear correlation between memorable moments and customer loyalty. Your customers don’t choose you based on the experience you provide, they choose you because of the experience they remember you provide.
Therefore, building a positive memory of your experience is essential to your customer loyalty growth.
Here are a few examples of how you can wow the customer:
– An unexpected welcome gift for new customers
– A we missed you gift to welcome customers back
– A personalised thank you note
5. Create a Referral Scheme
A great thing about referral programs is they increase acquisition and retention rates simultaneously.
Customers who love a brand will naturally share with their friends through word-of-mouth. A referral program encourages that behaviour with incentives for both the advocate and the referred friend.
Ultimately, you’ll keep your customers satisfied by rewarding them with perks for referring you, plus, you’ll increase your chances of acquiring and retaining customers that trust their peer’s referral. It’s a win-win for both you and the customer!
Keep Your Customers to Increase Your Profits
Your existing customers are your best customers because they are more likely to spend more on your products; because they keep your retention rate strong; because their lifetime value keeps increasing with every consecutive year they stay loyal; and because they are likely to refer others to your brand.
All of these factors help you to spend less on new customers and increase your profits.
Now that you’ve seen how valuable your existing customers are to your business, make sure to prioritise building a relationship with your customers, increase customer satisfaction and loyalty, and to build a robust referral program to make it easy for existing customers to share their positive experiences!
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