New clients? The best money is actually found in existing clients

If you’re involved in digital marketing, you know that new clients cost more. Quality leads gets more expensive, no matter which channel they come from. In fact, it’s much cheaper to get existing clients to increase their engagement with the organization or brand, so they will purchase again. This process is called Customer Retention, and if you haven’t realized it yet, it’s – for all intents and purposes – a form of science. Customer retention is not just about distributing benefits to disappointed clients, who threaten to buy from the competition; but it’s all about increasing the rate of returning clients, and turning them into recommending customers in the long run.

The retention process has a clear advantage: it keeps the value of conversions from existing clients high. Studies show a 70% jump in the conversion rate from clients, after a period of two and a half years. In addition, it increases brand loyalty in a way that allows brands to expand and increase the conscious asset, created in the clients. This way, for example, H&M – a chain that specializes in fashion – can also sell household and decorative items, and still be relevant when compared to chains that specialize in housewares. Customer retention also produces satisfied ambassadors of the brand, which in return benefit from smart, word-of-mouth marketing at no cost.

However, in order to implement a strategy of customer retention, several indicators must be included in it, so it will be successful. The first and most important is the index of repeat clients, which will include the number of clients who made more than one purchase in a certain period of time (most studies focus on a year, but depending on the product, some measure six months); the second index is the frequency of purchase, and it indicates the periods of time in which clients return to purchase after their first time; and the third index is the average value of the orders, which indicates the amount of money clients spend on each transaction on the website.

Another index that’s considered critical for implementing customer retention strategy, is calculating the client’s lifetime value. In other words: how much each client is really worth, in a certain period of time. The answer to this question lies in multiplying the frequency of purchases and the value of the order. In addition, it’s important to measure abandonment rate, and make sure it’s as low as possible. The big question is: how do you successfully meet all these indexes? We recommended that you read the following and maintain it:


Customer retention produces satisfied ambassadors of the brand (pexel)

1. Opening personal accounts

One of the most effective ways to retain clients over time is to allow them to open personal accounts. Allowing accounts makes it easier for you to follow-up, collect data on previous orders, purchase habits and of course – create automatic client journeys that lead the clients with confidence towards the next conversion.

2. Using marketing automation

Creating client journeys in all marketing channels, which meet the client at every point on their decision-making process, and help you understand how ready clients are to make another purchase. Sending interesting content via email, SMS or WhatsApp, strengthens the relationship with the clients, increases their involvement and most importantly: creates supervision and monitors the clients’ activity. A “thank you for buying” email, “abandoned cart” email or a “back in stock” message are the most common, and their role is to encourage sales in the short term.

3. Service and support experience

There is no shortage in reasons that can cause clients to leave or feel frustrated, but there’s no doubt that a negative service experience is the leading one. Therefore, the most basic recommendation is also the most complex: improve immediately the customer service system on your website. Either by planting a live chat, a sophisticated bot that can provide an initial response to clients, or by reinforcing the call center. It’s clear cut: don’t leave clients unanswered.

4. Establishing loyalty programs

Loyalty programs, or affiliate programs, are a great way to retain customers and generate high engagement on a regular basis. In most cases, the cost of creating a club is not high, and it’s easy to maintain over time. The goal is give benefits and discounts to loyal clients for repeated purchases, priority in choosing components such as delivery, return policy, launched products and more.

5. Personalization

A personalized purchasing experience increases the client’s lifetime value from their very first purchase. The personal appeal enables collecting reliable data, feedback, satisfaction surveys and personalization of related products further down the line. Personalized marketing is one of the most important growth engines of any organization in the digital age, in all channels.