understand why you need to retain your customers – WAU
What is the main strategy you use to increase your company’s revenue? If it is trying to win new customers, do not run away from what most do. But is this really the best way to achieve this goal? The simple answer is: no. The fastest, cheapest and most effective way to earn […]
What is the main strategy you use to increase your company’s revenue?
If it is trying to win new customers, do not run away from what most do. But is this really the best way to achieve this goal?
The simple answer is: no. The fastest, cheapest and most effective way to earn more money is not to go after new customers – although that is also important. But then what is it?
Three words: customer retention. Loyalty who already buys from your company is a smarter strategy and more cost-effective, especially in the long term.
And the best way to do that is by applying a retention funnel to your business process. Want to know how? That’s what we’re going to see now!
What is retention funnel?
Just as the sales funnel leads people who are less interested to the point of making the purchase, the retention funnel leads those who are first-time customers until they become a brand promoter.
As the name implies, it is a multi-step process that involves gaining the trust of new customers. After all, it is not because someone once bought your company that you already trust it completely.
Where in the sales process should you apply the retention funnel?
The exact time to apply the retention funnel may vary depending on your business model. But, in any case, the best option is to retain the person as soon as he contacts your product or service.
For example, a SaaS application should begin the retention process as soon as users sign up – even if it is only for a free trial or trial period.
If you don’t, the company risks many people not seeing enough value to use the product regularly, let alone pay for it.
The same goes for businesses with a high ticket and a steeper learning curve with the product. In such cases, it takes time for the customer to validate the choice, that is, 100% convinced that he did a good deal.
The sooner you start investing in retention, the faster it will happen.
5 Clear Retention Funnel Benefits for Your Business
In the short term, it may seem more interesting to just strive to grow the customer base, even more so if your acquisition process is performing well.
But when you see what the retention funnel can bring to your business, it will be even easier to start applying it without delay.
These are concrete benefits, which directly impact business cash and make it a lot stronger, especially over time.
We separated only 5 benefits, but that will be more than enough to convince you. Here are the highlights of having the retaining funnel!
1. A small improvement can greatly increase profits
You don’t have to retain all of your company’s customers to make the strategy worthwhile.
On the contrary, a study by Bain & Company indicates that only a 5% increase in customer retention can increase profit by 25% to 95% of a business!
These impressive data show that little time investing in retention will be enough to see concrete results. You have no excuse not to start right now.
2. It is much easier to sell to those who are already customers
What do you think is easier, asking a friend or stranger for a favor? The same applies to sales.
The relationship of trust you have already established plays a big role when it comes to selling to those who are already customers: they will have fewer objections and the barrier to deciding in your favor also decreases.
In fact, an Adobe study points out that those who are already customers are 9 times more likely to buy than a first-time buyer.
3. Recurring customers cost less and spend more
The customer’s acquisition cost is one of the most important metrics that any business needs to constantly measure. If the cost of bringing in the customer is too high, the company will lose money in the near future.
This cost includes all the effort to get the person’s attention initially (either through advertisements, blog content, social networks, etc.). Retention costs cheaper, because it skips this phase and goes into direct dialogue.
In addition, the same study already cited from Adobe shows that repeat customers spend more per purchase compared to those who have never bought before. In short, they spend more and cost less. Could not be better.
4. Loyal customers are more likely to become brand advocates
Do you know what Brands like Apple, Marvel and Sony have in common? Fans willing to promote and defend the brand at any opportunity.
This is the result of incredible use experiences with certain products. This creates retention, which over time can evolve to an even more advanced stage of admiration.
That’s where the fans, responsible for the best marketing that a brand can receive. It is genuine, disinterested and technically impartial (the person gains nothing to promote the company, other than personal satisfaction).
5. With fewer cancellations, more long-term projects can be done
From the moment that retention enters the scene, you will see fewer cancellations.
This brings greater financial stability to the business and gives the peace of mind for managers to execute more long-term projects, which usually bring better results.
A company that is only concerned with acquiring customers also deals with many cancellations and always needs to focus on high return actions in the short term.
Learn how to multiply your customer retention with these 7 incredible practices
One of the biggest benefits of investing in the retention funnel is that the results gain scale as the process continues.
At first it is more complicated, but with the right practices a business can even achieve a viral effect at any given time.
With that in mind, we have made a list of 7 incredible actions that you can apply to multiply the customers who become fans of your brand. See what they are!
1. Develop an email marketing strategy
Email Marketing is one of the best communication channels with leads and customers. Developing a strategy that uses this feature costs little and brings great results.
And there is no secret here: the idea is just to maintain the relationship with the customer. Relevant content, helpful reminders and occasional treats are all you need to do.
2. Create an Onboarding process
Onboarding is the practice of creating a first flawless experience with your product. If your product is digital, you can use solutions like Conpass.
But if your product is physical, you can build an implementation team to help customers get the most value possible the first time they use it.
3. Offer appropriate channels to listen to customers’ opinions
Have you ever had the feeling that your customers don’t want to express their opinions about what you do right and wrong? If the answer is yes, this sensation is illusory.
Customers always want to be heard, but you may not have offered the right channels for that yet. Don’t limit yourself to just one channel. Make phone, email, social networks and online chat available for this.
4. Find out what are the warning signs for your business
Before seeing the customer leave your company, there are always warning signs. The secret is to look for yours and create an action plan.
For example, imagine that your product is in continuous use. If you notice that customers go, on average, 3 months without using the product before canceling, you should take steps to ensure that no one is inactive for that long.
5. Educate customers constantly
Well-informed customers who know everything your product is capable of doing for them and can solve small problems on their own are less likely to look for another solution in the market.
That is why, invest in constant education. The use of Content Marketing, with blogs, videos, training, certifications and tutorials for those who are already customers is a smart way to keep them engaged.
6. Invest in customer success
Customer success goes far beyond offering quality support. It is about predicting problems and anticipating them, making the customer get the most out of the product.
The more positive results your customer has, the greater the chance that they will continue to buy and even recommend the product to others.
7. Use a CRM to maintain the personalized relationship
Personalization is the watchword in the digital relationship. If a customer feels just one more, they will rarely buy again from the same company, unless they have no choice.
Using a quality CRM helps to maintain a close relationship and never leave aside personalization in every interaction with customers.
The retention funnel is the perfect outlet to increase your revenue in a natural and consistent way. Satisfied customers spend more, spread the brand to others and follow it for years.
In the end, it is much better to sell 10 times to one person than once to 10 people.
Increasing sales, whether for new customers or for recurring ones, requires good tools. Discover 11 solutions that can help you today!