How customer retention can help businesses endure and scale their revenue
In the age of easily distracted consumers, engaging prospects and winning customer loyalty is a massive gap to fill. If there is anything that the last two years of the pandemic have taught us, it is to value customer retention as much as we value acquisition.
Customer retention is the key differentiator between enduring businesses vs those that end up struggling despite massive budgets. In 2022, retention will be the epicentre for businesses to scale revenue. If you haven't added customer retention to your growth playbook yet, now is the time.
Most digital-first businesses lack the resources or expertise to utilise a full-proof retention engine to their benefit. Of all, the small and medium entrepreneurs struggle to break through the complexities of customer journeys, data silos, and unified targeting, which ends up pulling the businesses back to the most familiar and comfortable approach – customer acquisition.
To make the big shift in 2022, brands aiming at scaling their revenue will align their goals towards retention-led models. Here’s how they can do it.
Instil a retention-led culture
Any brand’s most potential customers are the ones they already have. According to a report by Forrester, existing customers account for more than three-quarters of annual revenue for organisations.
Brands across the globe spend a ton of money on acquisitions but ignore the gold mine they already possess – their existing customers. These users know you already and can easily convert with a slight nudge.
Persuading existing users to make repeat orders translates to profits and a long-term database of loyal customers for your business. It is imperative to instil a retention-led growth model among product and marketing teams within the organisations to power stellar retention models that ensure optimal outcomes.
Unify and activate data with customer data platform
Today, customer retention strategy is not limited to product offers and discounts; it is more than that, and that’s exactly what a customer data platform (CDP_ makes you realise. It gives power and convenience to track user data from everywhere and offers you a unified perspective of your customer activities.
Keeping a CDP in place helps brands track their user events on every touchpoint across different channels, providing an all-user-in-one-platform experience. These data analytics help brands determine the most effective messages to engage them.
An effective CDP brings all the data together in a single source of truth for businesses to activate personalisation campaigns, delivering consistent customer experiences throughout the journey and reducing user churn rates.
Deliver omnichannel customer experiences
The year 2022 is going to be about expanding customer reach and delivering consistent customer experiences across various channels – SMS, email, Facebook, web-push notifications, among others using omnichannel marketing strategies that have proven to effectively improve customer retention.
Amazon is one of the best examples of being omnichannel. Rather than limiting profile access to their website, Amazon delivers the same experience across all platforms like mobile, Alexa, smartwatches, and even in-store, allowing users to get a unified experience across channels. A little plug-and-play will go a long way in boosting engagement and brand awareness among prospective customers.
Send automated, hyper-personalised communication at scale
Marketing automation will take the engagement game to a whole new level by becoming the go-to solution for most businesses in the coming year. In fact, 82 percent of customers are more likely to share their information with companies that can provide a connected and personalised experience tailored specifically for them.
Running automated campaigns coupled with hyper-personalised interactions can help businesses keep their customers glued to the brand for an extended period.
Leading consumer brands that are prepared for customer retention in 2022
- FirstCry, Asia's largest online store for baby and kids products, boosts its repeat purchases by over 400 percent using retention-led growth strategies.
- Shaw Academy, a leading online education platform, retained its existing students with a hyper-personalised and multi-channel engagement, achieving a 25 percent boost in revenue.
- Toppr, India’s booming after-school learning app, leveraged personalised campaigns and uplifted its conversions by 133 percent.
- TravelTriangle, India’s leading online travel aggregator (OTA), increases its returning users by 20 percent through behaviour-based targeting.
Retain or retreat
Retention is no more an option. It is the only way to preserve potential users and climb the revenue ladder. Businesses that are yet to adopt a retention mechanism have either perished or are struggling to survive. These brands have already lost out on more than half of the customers for nothing.
So, the big question that lies in front of the brands is whether they want to retreat or build their business with a retention-led growth model powered by the right retention stack?
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)