When wanting to buy a printer, a brand appears in the thoughts of each one of us. The same thing happens to us when considering the purchase of an SUV, a type of food product, or some clothing.
Many brands are synonymous with their products. Your customers are loyal and buy your products every time. A successful business must aspire to that level of loyalty and recognition.
Without a loyal customer base, it is impossible to create such a powerful and recognizable brand. That's why you must work to retain your current customers and build brand equity.
The tangible benefits of brand recognition and how they improve customer retention affect the entire business model on a day-to-day basis.
Customer acquisition and retention
One of the most common myths in business is that “if you build it, they will come and stay” (as in the movie “field of dreams«). The reality is that if relationships of trust are not built with customers, they will easily switch to another brand and the possibility of return represents a much higher investment than the initial acquisition.
You have to ask yourself, are we doing enough to retain customers? The following aspects are those that need to be considered in order to answer this question.
- No long term plan. From the moment the client is incorporated, a long-term vision of the relationship is required. The more the customer's lifetime value is maximized, the more profitable the customer will be and the more beneficial it will be for him.
- Lack of focus by type of client. Not all clients are long-term clients. The best customers are those who require the product or service for the long term.
- Poor business model. A weak and unprofitable business model drives away potential customers.
- Low quality of the product or service. When customers are not satisfied with the quality of your service and product, they will most likely leave you for a competitor.
- No offer of differential value. Have something original or different from the competition that can be offered to potential customers.
- operational problems. Miscommunications, product delays, service level breaches, or lack of clarity cause customers to cancel service.
In addition to capturing new customers as part of organic growth, retaining existing ones is crucial. The loyal customer means advantages for the business.
- Higher conversion rate. Customers who trust the brand continue to use the product or service.
- Lower cost. It reduces the time and money in acquiring new customers. The portfolio of existing clients is more profitable and the derived retention campaigns or sales increases. In general, it takes six times more investment to acquire new customers than to retain existing ones.
- higher potential. Which is better: continually chasing leads or improving the customer experience? Where can it be improved? Are user expectations adequately met? Soliciting responses from customers and attending to their requests marks the way to improve the offer.
- more benefit. In general, experience dictates that 80% of future revenue will be made up of 20% of current customers. Retaining customers is not only cheaper, but also more profitable, with a 25% to 95% increase in profits and 5% more retention.
