Whether it’s driven by the sales team’s enduring hunger for ever more leads, the customer service team’s unwavering belief in its top-notch delivery, or our own unswerving focus on measuring ROI quickly and simply on a campaign by campaign basis, for many of us marketers customer retention takes a backseat over acquisition.
We’ve uncovered some interesting facts and stats on this very topic to help convince you that cementing relationships with existing customers, keeping them loyal, happy and up and cross-selling to them is probably the quickest way to increase revenue and generate more profitable business;
- 82% of companies agree that retention is cheaper than acquisition. - Econsultancy
- Increasing customer retention rates by just 5% increases profits by 25% to 95%. - Bain and Company and Harvard Business School
- Only 23% of marketers track the rate at which customers churn and less than 40% track customer lifetime value. - Retention Science
- 70% of marketers believe their retention efforts are only average, poor, or in need of improvement. - Retention Science
- Telecoms experiences one of the highest average churn rates of any industry at around 30-35% per annum. - SAS
- While 80% of their marketers are using digital marketing budgets to acquire new shoppers, online retailers would double revenues if they retained 10% of their existing customers. - Adobe
- Customers spend less on a first purchase as they see new brands as risky. After building a relationship, customer spend grows alongside trust. - Small Business Trends
- Customer retention rates are 18% higher on average when employees are highly engaged. - Cvent
- 80% of future profits will come from just 20% of existing customers. - Gartner.
- The probability of converting an existing customer is 60-70% while the probability of converting a new prospect is only 5-20%. - Marketing Metrics.
- Marketing spend ratio required to convert an existing customer compared to that of a prospective customer is 1:5. - Boston Consulting Group
- In 2014, email marketing was cited as the most effective digital marketing channel for customer retention. - CMO Council.
- Repeat customers account for 26% of total online sales in Europe and 16% of total online revenue in the U.K. - Adobe.
- More than 75% of digital marketers report personalisation impacts customer retention and loyalty. - Forrester Consulting.
Don Draper’s knockback from Ketchup, an indirect referral from his existing Heinz contact, led him to conclude,
“Sometimes you’ve got to dance with the one that brought you.”
Makes sense. Keep your customers close. Because, spend time cosying up to someone new and when you turn back you might find your “date” has been romanced off by someone else!