We’re back with the ongoing battle: customer acquisition versus customer retention strategy. Which is more important to focus precious sales and marketing dollars?
The answer: it’s complicated. Factors including your company’s financial health, the strength of your competition, and the state of the market all play a role in determining that answer.
What isn’t complicated? Both play a large role in the success of a business. Check out our infographic below for an introduction into customer retention and acquisition strategy.
Be it Customer Retention or Acquisition, the Goal is Brand Loyalty
Both customer acquisition and customer retention strategy are an investment of time, energy, and resources, which is why companies weigh options wisely. But how can you choose one when both play a role in the success of the other?
When a business is new to the market, acquisition is the easy choice as it is the only option to generate revenue. But as agreed upon by 87% of frontline sales reps, 82% of sales leaders, and 78% of marketers in a survey, referrals through successful customer retention strategy are the best leads your business can get.
Research shows that a 5% increase in customer retention can lead to an increase in profits by 25-95%, but it cannot retain customers it wouldn’t have if not for customer acquisition!
The point here is to think outside the confines of revenue tracking and identify your goal. What makes a truly successful business?
A truly successful business has market share, mind share, and brand loyalty. With these factors, both acquisition and retention will be plentiful.
Build Brand Loyalty with a Customer Loyalty Program
So what does this mean for your business? Finding the balance! Knowing when to focus on acquisition and retention as it applies, while simultaneously seeking out marketing techniques that utilize both customer acquisition and customer retention strategy.
When it comes to brand loyalty and overall customer engagement, a customer loyalty program is an all-encompassing marketing tool. With a customer loyalty program, you can:
- Pair valuable end-user information with purchasing activity for more targeted, effective marketing.
- Use your online reward platform as a virtual billboard that current customers are more inclined to engage with as they log in to redeem rewards.
- Connect with loyalty participants via email, sms, mobile app, or push notifications to keep your brand top of mind.
- Provide incentive to enter referrals, take surveys, and undergo training on your product, all to better increase the effectiveness of your acquisition and marketing strategy.
- Integrate your current CRM platform with your customer loyalty program data, keeping all customer data in one convenient location.
With the right customer loyalty program provider and motivating incentive rewards, watch customers grow from new and current, to new, top-tiered, and loyal.
Looking for more information?
Check out these articles for more information on customer loyalty:
- How Do You Gain Customer Loyalty? 13 Steps to Building Loyalty
- Customer Loyalty Program Best Practices: Nichole Gunn Featured in Independent Retailer Magazine
- Customer Loyalty and Retention: 5 Reasons Why You’re Losing Loyalty