There is a lot of emphasis on acquiring new customers, but how much of a focus is being spent on the existing customers? Let’s explore acquisition vs retention.
Marketers spend 56% of their marketing budgets on acquisition, but while marketers spend billions of dollars attracting new business, marketing to current customers gets a higher return on investment.
- According to Bain & Company, it costs between six and seven times more to acquire a new customer than to retain ones they already have.
- Repeat customers spend more as much as 67% more, according to the same study.
- Loyal customers are worth up to 10 times as much as their first purchase, according to the White House of Consumer Affairs.
Marketing to customers is not just about their individual value, it is also about the value of their networks. According to Forbes, word-of-mouth recommendations influence 80% of purchases, and people referred by customers are 3-5 times more likely to convert to customers.
How do you use an engagement marketing strategy to focus on customers? Here are three areas of effective customer relationship-building:
- Your marketing organization must be customer-centric.
- Your marketing team must have a single view of customers than spans acquisition through engagement, across channels.
- You must have the ability to automate and personalize based on where the relationship starts, and where you want it to go.
It has been proven that the most effective marketing occurs when messages and interactions are personalized. McKinsey’s research shows that relevant messages can deliver between five and eight times the ROI on your marketing spend, and can lift sales 10% or more.
You want to tap into a platform that makes it possible to “listen” to your customers’ activities and refine your message based on those behaviors. By engaging your customers in a way that helps them realize success, you lessen the chances that an acquired customer will become part of your churn stat. In fact, you boost the odds that they’ll make a follow-up purchase.
If you’re focused on acquiring new customers, but you don’t have a program for keeping them engaged, stop what you’re doing. Customer acquisition strategies and tactics are simply a waste of time and money without a effective plan to keep those customers coming back.
“You gotta love the one you’re with” Crosby Still & Nash
Your marketing team must have a single view of customers than spans acquisition through engagement, across channels.