What is the essence of customer retention strategies
The client is the basis of the business and this is an axiom, and in order to keep it you need a strategy of retaining customers. Without a client, you cannot build a business, because it is the client who brings money to the business. Everyone knows about this, as well as about the fact that the clients guys are very picky. They are not fastidious out of the blue, but have every right to do so. Customers pay money and have the right to choose what to pay for and what not. This forces the business to be constantly under stress, because if you do not give the client what he wants, the client will leave.
Customer Retention Strategy
To prevent this from happening, so that clients do not leave, do not run away – we need a customer retention strategy that will allow us to purposefully, systematically, constantly and most importantly unobtrusively keep them. In order to build the most effective strategy, the client needs to be kept at the level of his idea, because at the core the client is a person, and the basis of a person is his idea. You could even say that a customer retention strategy is a strategy for identifying new customer-friendly life paths.
How can this be achieved? This can only be achieved if you offer the client a new idea that no one has previously offered him and convince him that this idea will make him very pleased. The client is happy to accept a good new idea, because he intuitively feels that the new idea will make his personal idea more advanced, and therefore more competitive, as well as the client himself.
In theory, everything is fine, but in practice, everything is not always so good, because inertness of thinking interferes with realizing all this. Eyes see the material component of the client, but do not see the ideal. As a result, the familiar way of thinking draws the client as something static, as something that has always been, is and will be in the same state. In reality, this is not so at all. A client is a living person, based on his idea. This idea is constantly changing, and after it the person himself is changing.
The one who is the first to offer the client an idea that develops him will eventually receive the client, but only as long as he does not have a need for a new idea. Accordingly, the strategy of customer retention should be long-term, because customer retention is an endless process, it never ends. Whoever finishes it first is usually the first to leave the market.
For this reason, in developed countries, a large amount of money is invested in customer interaction systems. They know very well the price of customers, as well as the price of loss of customers. They know very well that it is much cheaper to manage than to create new customers. The ratio between the cost of creation and the cost of customer retention is on average 10/1. This means that to create a new one you need to spend 10 times more money than to retain an existing client.
Customer Retention Strategy – It’s Profitable
Keeping customers is profitable. On the one hand, it’s 10 times cheaper than creating new ones, and on the other hand, you can retain a dozen customers for the amount that you need to spend on creating one client. This means that if you manage customers, and not create them to replace the departed, you can free up money for something else. If you know how to retain customers, then you do not need to search for new customers.
For example, money can go to purchase new equipment or to finance a staff motivation system, which will positively affect the overall level of competitiveness of both the business and its products or services. To retain customers, you need a specific algorithm. It is impossible to keep the client without an algorithm, and in the end he will go where he himself needs to.
Customer Retention Strategy
Accordingly, in our case, the strategy of customer retention is the consciousness of clients motivation to ensure that they remain ours and do not go to the competitor. The fact that without retention they will go to the competitor does not have to doubt, because there are enough examples. These examples are hundreds of thousands around the world. Every year, hundreds of thousands of businesses cease to exist, because of how they have insufficient customers. Lack of customers is the most significant reason for closing a business.
The customer retention algorithm is quite simple. Since the client is basically an idea, it means, first of all, it is necessary to highlight his idea. Accordingly, the customer retention strategy begins with highlighting their ideas – this is the first stage of the algorithm. If there are few customers, then you need to highlight the idea of each of them. If there are many customers, then it is enough to segment them and highlight the idea of a customer segment.
This is done similarly to market segmentation, because the aggregate of customers is actually the market. To highlight the ideas of customers in noomarketing, a special tool is used. He is currently undergoing testing and very soon there will be his official announcement on this site. In principle, the idea of a client at the subconscious level is known to every person.