Benefits of Having Good Customer Retention in Business

It's hard to believe that so many brands are still devoting most of their resources to attracting new consumers. This is not wrong. However, it is not only new consumers who are the target of a brand, the loyalty of old consumers is also equally important.

If you lose loyal customers, it means you have to regain their trust, and keep them actively engaged. However, as you know, consumers are very sensitive. They will not hesitate to leave a brand if the product or service provided is bad. However, you can prevent these things with customer retention.

What is customer retention?

Basically, customer rendition is building relationships with consumers so that they will be loyal and loyal to your brand. Without realizing it, good relationships with consumers will build profits for brands and consumers.

By continuously increasing consumer involvement, consumers will feel an emotional connection to a brand. This will build a sense of loyalty and loyalty among consumers which of course has many benefits.

Customer retention may not have the same reputation as attracting new customers. However, to increase profits, customer retention is more useful. Even better, profit is just one positive aspect of customer retention.

The main benefit of customer retention

There are various strategies that can be applied when a business plans a customer retention process. Every strategy is of course also carried out to continue to prioritize the value brought by a brand. Through these methods, here are the main benefits that businesses can get from customer retention.

1. Retention is cheaper than acquisition

There is an opinion that keeping consumers is more expensive than attracting new consumers. This assumption is not always true, because many studies show that retention is more economical than acquisition. However, retention is not always easier.

2. Loyal customers are more profitable

Never underestimate consumer loyalty. According to research, loyal consumers buy 90% more often, spend 60% more per transaction, and are five times more likely to buy from the same brand again. On average they deliver 23% more revenue and profitability over other consumers.

3. Your brand will stand out more

Put yourself in the shoes of a consumer, and consider how many brands are interacting with, and truly appreciating, your purchase. Most likely you can only think of one or two brands. This is because most brands focus on acquisition, so brands that carry out retention will stand out more.

4. Increase word of mouth recommendations

Loyal consumers are the best source of business. Despite all of a brand's marketing efforts, audiences are still heavily influenced by recommendations from friends and family. Research shows that 90% of millennials will recommend brands they like online.

5. Active customers provide more feedback

Feedback is very important for the success of a business. As research shows, consumers who complain, and whose problem is resolved well are 84% less likely to leave the brand. Apart from that, consumers will also be very happy if brands listen to criticism and suggestions, because they feel they are important and influential figures.

6. Consumers will explore your brand

If you want the newest product to sell quickly on the market, take advantage of your loyal consumers. After a brand is able to prove itself through one product or service, consumers are six times more likely to try a new product or service from that brand. According to a study, loyal customers are 50% more likely to try new products.

7. Loyal consumers forgive more easily

Service is important for consumers. A study shows that more than 1.6 trillion dollars is lost because consumers experience poor service. This is also the main reason why audiences leave a brand. Meanwhile, loyal consumers will consider poor service to be normal, so they will forgive more easily than other consumers.

8. Consumers will accept your marketing

Nobody likes being the object of marketing, except loyal consumers. They are four times more likely to receive an invitation from a brand, and seven times more likely to receive a promotional offer. This is because consumers feel appreciated when a brand tries to reach them.

9. There is room to try new things

Keep in mind that loyalty will change, so too many changes to a brand can drive consumers away, be it changes to products, services, even logos. However, as long as you maintain the basic premise that makes consumers interested in your brand, they will remain loyal to your brand. In fact, loyal consumers are always waiting for changes to be made by a brand.

10. Better employee health

Meeting income targets by relying on new consumers is not an easy thing. Therefore, customer retention is carried out to protect income and ensure the welfare of employees who have an important role in maintaining consumer loyalty.

To increase customer retention, you can carry out reward programs, special promotions, discount programs, or even implement a sophisticated CRM system. Apart from that, the most important thing is not to forget loyal customers when you are looking for new customers.