Customer Retention Strategies: 8 Ways To Improve Customer Retention Rate In 2020

Are you looking for effective and impactful customer retention strategies to retain your existing customers?

 

Customer retention is one of the biggest assets ignored by most of the brands and businesses as they are obsessed with lead generation and acquiring new customers. To boost your brand/business value, revenue and sales your marketing techniques should always include effective and impactful customer retention strategies.

 

By focusing on customer retention we are not implying that acquiring new customers and leads is not good for your business. But retaining your existing customer should be your primary choice as it can benefit your business in many ways.

 

According to the recent survey by SAS and Loyalty 360, compared to the new customer 68% of the business/sales come from existing customers.

Convincing your existing customers can take less effort and cost compared to your new customer because they already know about your brand and service. Look at the below ecommerce start to know why customer retention is important for your business.

 

In the article, we will help you to differentiate between customer acquisition and customer retention. Not online thet but this article will also offer you effective and impactful customer retention strategies that you can use and implement to retain your existing customer.

 

If your business is getting lots of cart abandonment rate then checkout article on Reduce Shopping Cart Abandonment Using Different Techniques In 2020

 

Customer Acquisition Vs Customer Retention

Many brands and businesses get confused in identifying the difference between customer acquisition and retention. Both are two different things.

 

Customer Aquisition

 

The main goal behind customer acquisition is to gain new customers to grow sales and revenue. Customer aquisition is more focused on marketing that means identifying the potential customers and offering different lead magnets to attract new lead.

 

It is dependent on various channels like paid ads, commercials, or direct marketing (speaking directly to the client to get business). Customer aquisition strategy generally includes identifying potential customers, creating and implementing different marketing strategies, communicating with potential leads, and measuring the success of the marketing strategy.

Customer Retention

 

Compared to customer acquisition, customer retention is all about focusing on and nurturing existing customers to build a strong relationship with them. Once your existing customer starts trusting you then they will never hesitate to purchase and use your product and services.

 

Customer retention strategies include optimizing your customer service, product quality, seamless communication, offering loyalty programs, and more. Remember your existing customers are the ones that will give you more profit than new customers.

 

Most of the brands and businesses commit a mistake by ignoring their existing customers are focusing on new customers below we have discussed why you need to care about your easing customer.

If you are confused whether you should focus more on customer acquisition or retention then looked at the below chart (Remember both are important but your existing customer can offer more profit then new customer)

 

How to Calculate customer retention rates?

 

If you want to calculate the customer retention rate for your business then you can follow the below steps which will offer you a brief insight into how you can calculate customer retention rate.

 

• Firstly, it is recommended to decide the time period (month quarter, days, and more)

 

• Next, identify the total number of customer you had at the beginning (customer purchased form your online store)

• After identifying that next you need to divide the total number of customers you had at the beginning and end of the time period.

 

• At the end of the time period, you might have gained new customers so before dividing you can subtract new customers by the total number of customers at the end of the time period.

 

• After identifying that you can divide the number of customers at the end of the time Prayer by the total number of customers at the beginning.

 

• Multiply the obtained number with 100 to get the customer retention rate.

Why should you always follow up with your existing customer?

 

Before jumping into how to improve your customer retention lets look into why you should care about your existing customer.

 

Most businesses and brands around the world think that by providing great products and services they can make their customer stay. But the harsh truth is that if your marketing strategy does not include converting your existing customer into a loyal customer then sooner or later they may leave.   Look at the below image to differentiate between new and existing customers. Read more on

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