Entrepreneurs don’t make a habit of missing opportunities. Winning new customers shouldn’t turn into a conveyor belt process. In this guest post, Alex Harrington-Griffin explains why customer retention should be a top priority.
Today’s business world is constantly in flux, with new marketing and strategy trends to contend with daily. Trends that will inevitably come and go. In an attempt to keep your business profitability consistent, it’s worth allocating your time and resources on more sustainable programs, like customer retention.
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The internet has opened up a world of possibility for a newly empowered consumer; they have the freedom to buy what they want, from whom they want, at the time they want. As a result, companies must realign their priorities and generate customer loyalty rather than expect it.
According to a study by the global business consulting firm, Baines and Company, a 5% increase in customer retention can increase a company’s profitability by 75%.
If that’s not enough to convince you, here are three reasons why looking after your customers should be a top priority.
1. Price per customer
Retaining an existing customer base is cheaper and ultimately more profitable than targeting and acquiring new ones. Even offering an upsell or introducing a loyalty program, such as the new printed.com rewards program, will prove to be more cost effective than trying to engage a new market. If you work hard to build and nurture a loyal customer base, you will be rewarded by their frequent and increasing business – in both amount and quantity!
2. Insulation from price competition
The internet has enabled a price competition movement that has caused businesses to be recklessly competitive with their prices. Maintaining and nurturing an existing customer base allows you to enjoy a certain level of security from this rat race – a customer with a purchase history is less likely to be enticed by a few pounds.
3. Reduced marketing spend
In creating a loyal customer tradition, you will inevitably lower your marketing spend. As the loyal customer base grows, you will be required to spend less money on bringing in new markets. If you’re providing a great service, your customers are going to talk about it, and there is no greater advertising than positive word-of-mouth from satisfied customers.
If you’re keeping your customers loyal, you’re keeping them away from the competition – strengthening your position. It’s that simple!
When the pressure is on, it’s easy to overlook the value of customer of retention. Yet, it’s your loyal customer base who will generate the greatest portion of your profits…so don’t forget that they’re the most significant element of your business - in fact, they are your business!
Alex Harrington-Griffin heads up Partnership Marketing at printed.com and has worked with some of the UK’s leading publishers growing various partnership programmes.
In a strong bid to expand the offering to small businesses buying print, printed.com have recently launched the printed Reward Program. The program gives customers points for every pound they spend on the site, which they can redeem on household electrics, experiences, stock imagery, office supplies and of course, printing. Find out more at printed.com.