4 ways retailers can increase customer retention

‘’Do what you do so well that they want to see it again and bring their friends’’

Walt Disney

This is Walt’s cute way of saying that: The probability of selling to an existing customer is 60-70%, while the probability of selling to a new prospect is only 5% to 20%.

(Source: Invesp)

And you’ve probably also heard that customer retention is 5- 25 times cheaper than customer acquisition.

In today’s saturated market, to have a proactive overall customer experience strategy that understands and speaks to the deepest needs, pain points, and emotions of your customers; which in turn will naturally address retention.

So here are 4 ways you can increase customer retention:

Hope is not a strategy… Ask for referrals

64% of marketers agree that word-of-mouth is the most effective form of marketing.

This isn’t a surprise, people love to share positive brand experiences with their friends and loved ones! And even folks like seeing their name in print as a testimonial – help them be famous for those 15 minutes of which Andy Warhol spoke about

Most marketers know that word-of-mouth is the best form of marketing, but not many of them do something about it.

What we mean by that is: ASK FOR REFERRALS!

Having a great product or service is only part of the equation…

Serving a customer extremely well and then hoping they’ll bring their friends is based on hope.

And hope is not a strategy!

So how do you ask for referrals?

First, marketers often forget to look at this from the consumer’s point of view. Why on earth should they give you a referral? Yes, it’s important to you, but why is it important to them?

And second, they have a lot to lose if they refer a friend to you. You might somehow do something that, through no fault of your own, disappoints.

And third, the act of recommending you isn’t easy. It’s not easy to recommend a tailor to make your co-worker look a little less shabby. It’s not easy to bring up the fact that you have a great online shoe store…

Given the no-win nature of most referrals, you need to reset your expectations and consider a few ideas:

  • Make it easy for someone to bring up what you do (by changing the nature of the service or product)
  • Give your best customers something of real value to offer to their friends (a secret menu, a significant gift certificate). Once you do that, not giving that gift to a friend feels selfish.
  • Paying customers to refer you rarely works, because you’re not just asking for a minute of their time, you’re asking them to put their credibility on the line.
  • Understand that low-risk referrals happen more often than high-risk ones, and either figure out how to become a low-risk referral or embrace the fact that you have to be truly amazing in order to earn one.

Always remember; saying ‘’thank you’’ in deeds, goes a long way.

(Sources: Semrush, Seth’s Blog)

Stay top-of-mind

Email marketing is one of the cornerstones of a top-of-mind marketing strategy. Email marketing generates $38 for every $1 spent, so it’s a worthy time and money investment.

Every piece of content you send out to your mailing list should add value to your audience and position you as an expert.

Now what does “Adding value” truly mean?

Valuable content can be:

  • Educational
  • Entertaining
  • Inspiring/motivating

Anything that can actually add value (duh..) to your audience’s lives.

When you become a resource, you’re building affinity with clients helping them remember you and the value you provide.

Email marketing isn’t the only channel you can use to increase customer retention and lifetime value!

Retargeting previous buyer’s through Facebook or Instagram ads can work wonders! But remember that your ads should be interest-based.

For example: If they bought tennis shoes, show them tennis socks (if that’s even a thing…)

(Source: Bit.Ai)

Use email automation

You might have heard about it before, but still wonder “what is email automation?”.

Email automation helps you send timely, regular, and personalized emails to your target audience without any manual intervention on your part.

Once you segment your customer data, you can create email campaigns that are entirely dedicated to retention.

The people that buy the most should receive red carpet treatment and your goal should be to continuously put a smile on their faces.

Here’s a great example from David’s Tea:

This is the perfect example of a customer retention email campaign!

Many marketers focus too much on customer acquisition and forget to give somewhat equal importance to customer loyalty.

You can start segmenting your database based on:

  • The number of purchases. If a customer has already made several purchases from you in the span of a few months, you can already see patterns in their buying behavior. If they’ve bought many times before, they are far more likely to buy again.
  • The type of purchases they’ve made. Segment customers by product category or type. For instance, if you have a customer who bought a boy’s jacket, it’s not far-fetched to imagine that they might also need boy’s sneakers or toys. You can create a drip campaign cross-selling related and relevant items.
  • Personal data. Information like their age, sex, or location can be a treasure for your upselling efforts. Follow up with targeted emails like discounts in their town or a new line of products that are popular among their age group.


Accenture found that 65% of consumers will purchase from a brand that knows their buying history.

Since personalization has become a differentiating factor between businesses in this day and age and is one of the keys to a retention strategy, retailers should continuously work toward having clean customer data so that they can reach the holy grail of retail marketing: one-to-one personalization.

Here are the different levels of personalization:

Personalized subject lines and email copy

Emails with personalized subject lines are 26% more likely to be opened. Using your prospect’s first name in your email copy can make your message feel more personal.
But nowadays, every single business that collects customer data uses this…

Think about it, how many promotional emails do you receive each week? How many of them use your first name in the subject line and in the copy?
Yes.. almost all of them. Relevant content is what will make your emails stand out!

Interest based segmentation

Understanding your customers’ interests is a prerequisite to delivering personalized experiences that keep your customers engaged. To do this, you’ll need accurate customer data.

You can create different interest-based segments by:

Asking your customers what interests them via a form on your website, or in an email, or even on your mobile app if you have one.

Taking a look at previous purchases (If a customer purchases tennis shoes, show them tennis-related content).

By analyzing engagement history (What content do they engage with the most?).

Assumptions are a marketer’s worst enemy. This type of relevant information will help you drive cross-selling and upselling initiatives in a data-centric way.

One-to-one marketing

This is the top level of personalization, AKA the holy grail of marketing! At this stage, each user will live a different experience and will go through a different journey.

By using clean, accurate customer data, you can show relevant marketing messages at scale.

Amazon is the perfect example. The “You might also like” section has a one-to-one relationship with the user. It is unlikely that another customer will see the same suggestions.

What if you could do this with your business?
It’s more accessible than you think! Marketers who use Salesforce’s Marketing Cloud have seen an 80% increase in customer subscription and a 23% increase in marketing ROI.

Einstein Recommendation is a feature that you can integrate with your Marketing Cloud instance to recommend the next best content, the next best offer, or the next best product to your customers based on their actions and behavior when they visit your website.

One thing to keep in mind is that 1:1 marketing requires high data reliance. In other words, if your data isn’t clean, it’s nearly impossible to accomplish this level of content personalization.

We’d be happy to help clean your Salesforce data, contact us today if you have any questions!

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