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Deleted member 708208
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Customer retention is THE metric that drives brands into the realm of profitability.
It’s the art of retaining a client once the onboarding process has happened and it determines how well your
marketing strategy is performing along with what customers think of your finished product.
Your customer’s lifetime value is the metric of metrics.
Why?
Let’s give a simple situation of why customer retention is important.
Say you own a service and each campaign costs $50. After analyzing your time + cost across various platforms,
you determine it takes $70 to acquire one client.
Now you may be thinking that you’re losing roughly $20 per sale.
You would be right if you did not factor in a customer’s lifetime value. Now let’s suppose this customer that
you acquired for $70 is happy with your service and decides to continue doing business with you.
At this point, you sell the campaign for 3 months to this single customer. Because of this $70 worth of ad spend
you have netted a profit of $140. Once the customer quits purchasing you still retain their data and try to
find new ethical ways of pitching them upsells.
Not bad, right?
For a long time now we called this the customer escalator where you onboard leads and
keep them for the ride. Unfortunately a lot of agencies/businesses' "keeping" looks like this...
So let’s take a look at how you can increase customer retention and improve the situation…
of agencies/businesses fail at because of false advertising. New businesses especially suffer from setting the
wrong expectations because they’re so eager to win over new clientele.
You are setting your business up to fail when you set a standard that is higher than you can deliver
through your ad creatives or content copy.
By not over-selling a product you can sell more of it to those who wanted it in truth from the start.
Notice how @BassTrackerBoats in one of his threads stated over delivery is the goal. Obviously, that
does not mean doing so when it hurts (SEO) but exceeding expectations. Part of the way to achieve that
is by setting the right framework from the start.
Make sure you are clear in your advertisements and terminology.
False promises will lead to either a chargeback or simply quiet refusal to buy again.
So now that $140 purchase turns into a $20 loss even though the customer did not complain.
Some companies increase customer retention by starting a trial program.
If you can’t do a trial then try to set up a sample product, demo, or truthful case study.
This will give your potential customers the ability to experience your product before they purchase and can
cut down on chargebacks, refunds, and unsatisfied customers leaving that you didn’t even know about.
but it also pertains to digital products. If you cannot deliver quickly in the 2020s then forget about it.
A study by DC Velocity found that 70% of consumers expected delivery within 1 week.
That does not mean a full seven-day week either! Remember that most deliveries happen between
the days of Monday and Friday. For startups, that demands being able to order products in bulk and
having a warehouse facility to mail domestically.
Customer retention has never relied on delivery time as much as it does now.
A great way to get started without a lot of costs is to find a pick and pack service.
They specialize in being your logistics partner. You ship in bulk them, and they will pack down the
boxes into deliverables. Your tag system can be integrated with their software stock allowing for quantifiable stock changes.
you’re selling a digital service or product remember that instant gratification defines
Generation Z. The “now” factor is greater than the “wow” factor as we move into the 2030s.
so well is that people enjoy the excitement of variety in their lives and now they’re expecting this
from the products they purchase and the brands that offer them.
There’s a reason why there must be a new phone release for big brands even if the technology has not changed that much.
Repeat after me…
Society.
Craves.
Change.
For good or worse change is the driving force behind much of society.
Going forward your brand needs to be dynamic and not fall into the pit of stagnation. Let’s say you sell a pencil box,
and it comes in two colors. When you first released it the pencil box was a hit and you made pretty good money.
Fast forward and it’s not selling so well…
Why?
Fatigue happens even to the best of consumers. To fix matters you can create a new design out of an old product
and do a small relaunch. By doing this you will instill a newfound love for old products and leverage data you
have already on previous customers.
change your ad copy so that ad blindness does not set in on your target audience. With a dynamic approach, you can
increase your customer retention rates and turn a failing campaign into a profitable one.
Remember, for you to grow you have to make sure your clients are growing too.
So then...
What is your tip to create higher customer retention rates and overall happy clients?
It’s the art of retaining a client once the onboarding process has happened and it determines how well your
marketing strategy is performing along with what customers think of your finished product.
Your customer’s lifetime value is the metric of metrics.
Why?
Let’s give a simple situation of why customer retention is important.
Say you own a service and each campaign costs $50. After analyzing your time + cost across various platforms,
you determine it takes $70 to acquire one client.
Now you may be thinking that you’re losing roughly $20 per sale.
You would be right if you did not factor in a customer’s lifetime value. Now let’s suppose this customer that
you acquired for $70 is happy with your service and decides to continue doing business with you.
At this point, you sell the campaign for 3 months to this single customer. Because of this $70 worth of ad spend
you have netted a profit of $140. Once the customer quits purchasing you still retain their data and try to
find new ethical ways of pitching them upsells.
Not bad, right?
For a long time now we called this the customer escalator where you onboard leads and
keep them for the ride. Unfortunately a lot of agencies/businesses' "keeping" looks like this...
So let’s take a look at how you can increase customer retention and improve the situation…
Set The Right Expectations
Setting customer expectations is critically important for customer retention and it’s something a lotof agencies/businesses fail at because of false advertising. New businesses especially suffer from setting the
wrong expectations because they’re so eager to win over new clientele.
You are setting your business up to fail when you set a standard that is higher than you can deliver
through your ad creatives or content copy.
By not over-selling a product you can sell more of it to those who wanted it in truth from the start.
Notice how @BassTrackerBoats in one of his threads stated over delivery is the goal. Obviously, that
does not mean doing so when it hurts (SEO) but exceeding expectations. Part of the way to achieve that
is by setting the right framework from the start.
Make sure you are clear in your advertisements and terminology.
False promises will lead to either a chargeback or simply quiet refusal to buy again.
So now that $140 purchase turns into a $20 loss even though the customer did not complain.
Some companies increase customer retention by starting a trial program.
If you can’t do a trial then try to set up a sample product, demo, or truthful case study.
This will give your potential customers the ability to experience your product before they purchase and can
cut down on chargebacks, refunds, and unsatisfied customers leaving that you didn’t even know about.
Stress Test Your Supply Chain
This tip is especially important for E-commerce brands that are delivering products on the regular,but it also pertains to digital products. If you cannot deliver quickly in the 2020s then forget about it.
A study by DC Velocity found that 70% of consumers expected delivery within 1 week.
That does not mean a full seven-day week either! Remember that most deliveries happen between
the days of Monday and Friday. For startups, that demands being able to order products in bulk and
having a warehouse facility to mail domestically.
Customer retention has never relied on delivery time as much as it does now.
A great way to get started without a lot of costs is to find a pick and pack service.
They specialize in being your logistics partner. You ship in bulk them, and they will pack down the
boxes into deliverables. Your tag system can be integrated with their software stock allowing for quantifiable stock changes.
you’re selling a digital service or product remember that instant gratification defines
Generation Z. The “now” factor is greater than the “wow” factor as we move into the 2030s.
Create Variations
For this method let’s take a popular business model, monthly box clubs. The reason they’ve doneso well is that people enjoy the excitement of variety in their lives and now they’re expecting this
from the products they purchase and the brands that offer them.
There’s a reason why there must be a new phone release for big brands even if the technology has not changed that much.
Repeat after me…
Society.
Craves.
Change.
For good or worse change is the driving force behind much of society.
Going forward your brand needs to be dynamic and not fall into the pit of stagnation. Let’s say you sell a pencil box,
and it comes in two colors. When you first released it the pencil box was a hit and you made pretty good money.
Fast forward and it’s not selling so well…
Why?
Fatigue happens even to the best of consumers. To fix matters you can create a new design out of an old product
and do a small relaunch. By doing this you will instill a newfound love for old products and leverage data you
have already on previous customers.
Conclusion (Bonus)
Performance marketing strongly relies on a customer’s lifetime value. As a bonus, you should make sure tochange your ad copy so that ad blindness does not set in on your target audience. With a dynamic approach, you can
increase your customer retention rates and turn a failing campaign into a profitable one.
Remember, for you to grow you have to make sure your clients are growing too.
So then...
What is your tip to create higher customer retention rates and overall happy clients?
