Here’s why we advise you concentrate a significant portion
of your marketing efforts on existing customers.
#1 - Cost of retention versus cost of acquisition
While gaining new customers could be extremely motivating, nurturing your brand’s relationship with existing customers is far more financially rewarding. Studies reveal that the cost of retaining existing customers can be up to seven times lower than the cost of acquiring new customers.2 Marketing to existing customers reduces costs by eliminating a significant chunk of business development expenses.
#2 - Reduced marketing efforts
As your existing customers have already experienced your brand, your team must devise strategies to build the loyalty of these customers to promote repeated purchases. This can be done by using targeted strategies such as loyalty cards, direct mail and subscriptions much of which also lend themselves well to automation.
#3 - Clearly defined target customers = more effective communication
When your business is frequented by the same set of customers, you can make fairly specific inferences about the groups of people that you cater to. This will help you customize your marketing to deliver exactly the kind of messaging customers would like to hear at different points of the in their purchasing cycle. You can then employ automated stay-in-touch strategies using the segmentation of existing customers within your CRM, which is automatically two-way synced with the mass emailing automation process. Smart automation would intuitively send the first email in a series to a new customer while sending the 55th email within the series to a different customer who might’ve been around for a while.
#4 - Word of mouth publicity
A happy customer is a brand ambassador for your business. When you know what they have previously purchased and offer them other relevant products and services that might be useful, they consider your cross-selling and up-selling efforts good customer care. This leads to customer delight. A loyal customer refers 50% more people than one-time buyers.3
To get the most out of your existing pool of customers, you need to understand their needs, preferably in real time. CRM software helps you do just that. It streamlines customer services, organizes information flows and helps you closely monitor the pulse of your consumer. Find out how a cloud-based CRM can help your team work smarter and improve customer retention. Our training can help you get the most out of your CRM platform.