High acquisition costs, abandonments, decrease in sales, poor engagement rates, and all other such problems can have one common solution and i.e., a strong retention strategy.
Most smart and successful businesses have a retention-first approach and give more importance to it than acquisition.
Because there are ample proofs, studies and exhibits that indicate the importance of retention over acquisition.
For instance, an HBR study maintains that a five percent growth in user retention leads to a growth in profits between 25-95%.
A report by HubSpot indicates that brands that adopt a retention-first marketing strategy see an average 40% increase in their lifetime value and a 20% increase in repeat purchases.
Thus, retention marketing can prove to be a winning strategy for all kinds of eCommerce brands and online businesses.
However, this may not be applicable to all kinds of niches and may vary depending upon what you sell. For instance, a grocery store is more likely to attract repeat customers. But one may not often return to buy a car or dishwasher for that matter.
However, as long as you want customers to return to your store for more, retention marketing is the way to go.
Let us delve deep and explore more about it!
What is Retention Marketing?
Retention marketing is all about getting your customers to stay or come back for more.
It focuses more on existing customers than the acquisition of new ones.
Retention marketing has become extremely popular among eCommerce brands and other online businesses.
It can be used for a variety of purposes and instances like:
- Gaining customer trust at onboarding
- Engaging customers in campaigns
- Re-targeting lost customers
- Inspiring less-active customers
… and more!
Nowadays brands are focusing more on keeping their users happy, content, engaged and active through various strategies including marketing, promotions, and more.
The retained users not only contribute in higher CLV (customer lifetime value) but also strengthen other metrics determining the success of your business.
Such customers can also help you build social proof and a robust brand image, thereby attracting new users by default.
Retention marketing can help you in achieving all that, and more.
Types of retention-marketing
In a nutshell, “retention marketing” is a go to technique for eCommerce businesses for increasing their sales, gaining positive reviews, increasing customer satisfaction, and strengthening the overall brand image.
Outstanding benefits of Retention Marketing
The points discussed above might have already given you some hints of the advantages of retention marketing.
As evident, retention marketing can help you in:
- Increasing customer return rates and lifetime value
- Reduce churn rate, uninstalls and abandonments
- Increase purchase frequency and session time
Let us discover some more advantages and get a clearer picture. The primary benefits of retention marketing are as follows:
Effortless & easy
Selling to existing customers is far easier than selling to new customers, thus every campaign is more likely to be a success when targeting existing customers.
It is at least five times less costly to retain a new customer than to acquire a new one. Therefore, retention becomes way more feasible for new and small-scale businesses as well.
Returning customers are 9 times more likely to convert when compared with new users. Thus, your earnings and ROI (Return on Investment) grow manifold.
Increased CLV & AOV
Repeat customers tend to have higher Lifetime Value and make more purchases, thereby increasing the Average Order Value and powering your success metrics.
Every content and happy customer that you retain is more likely to leave positive reviews and word of mouth or referrals, thus contributing to new customer acquisition in many ways.
Some sure-shot techniques of Retention Marketing
There are many ways to a customer’s heart.
You can retain your customers by:
- Offering an amazing experience right from the start
- Informing customers of new updates and developments
- Sending emails, notifications and newsletters regularly
- Inspiring them to join a subscription plan
- Inviting them to return for more
- Regularly showering them with irresistible offers
- Making them feel special and exclusive
- Pampering them with customized deals
- Staying connected through various mediums
- Incentivizing their loyalty with rewards
- Giving referral bonuses and gift coupons
- Offering unmatched support and resolution
Whichever path you choose, you can ace retention marketing only with the right strategy in place.
So go through the points below and discover some on-point and tested techniques of retention marketing for absolute success.
1: Understand your users
In order to retain a user, you must be aware of them first.
Asses your users’ personality and behavior and segment them based on their demographics (name, age, location, etc.), psychographics (attitude, interests, etc.), technographics (device type, surfing path, browser, etc.) purchase or usage behavior and intent, and more.
Also, asses their position in the purchase funnel and learn where they are in their buying journey.
This will help you head in the right direction and make the most of your retention strategies and endeavors.
2: Know your numbers
By numbers, we mean the various metrics that define your business, its success, its weaknesses, and more.
This may include the current retention rate, churn rate, average customer lifetime value, average order value, conversion rate, and more.
Also try to comprehend and consider the factors, that lead to the above achievements or setbacks.
Analyze and optimize your funnels to reduce or eliminate the frictions that are affecting your conversion and retention rate.
Remember, being data rich and using the data to drive action can make you super successful.
3: Experience is everything
Offering an amazing experience to each and every user is the first and the most significant step towards retention.
Keep your users interested, engaged and content and you will be able to retain them without much effort.
Make sure that their end to end journey from onboarding to more, is a rewarding and effortless journey that tempts them to return for more.
4: Leverage feed-back channels
Your feedback and communication channels can tell you a lot about your customers’ intents and experiences.
So, leverage all such channels and try to assess your strengths and weaknesses by stepping into your customers’ shoes.
This may include chat or other support channels, reviews, ratings, social media comments, and more.
Devise your retention strategies pick your retention marketing methods and mediums accordingly.
5: Turn visitors to app users
Websites suffer a “buy and bye” phenomenon. Users may land on your website and even make a purchase but not return to you once your site is out of their sight.
Apps can counter this problem and give a boost to your retention rate.
Once an app is installed on a customer’s device, it constantly reminds them of your brand and inspires them to return for more.
Therefore, you must complement your website with an app and then aim to turn every website visitor into an app user.
With DIY technology in picture, it has become easier and more affordable to build apps for any business, especially when you have a WordPress website.
For instance, you can make your own app with a free app maker like AppMySite and enter the mCommerce industry in no time.
This will give a boost to your retention endeavors and also offer the ease of usage and convenience to your customers.
That was all about retention marketing.
If you found this interesting, then also go ahead and checkout our other blogs on WordPress management, mobile app development, marketing and more.
Do not forget to explore AppMySite. (It’s free).
Go ahead and implement all that you have learnt today and mark your territory in the online business sphere.