Did you know it costs five times as much to attract a new customer than to keep an existing one?
Businesses often get caught up in the rat race to beat their competition to new customers. While doing so, they spend massive amounts of money and resources to get as many leads as possible. In fact, 44% of companies have a greater focus on customer acquisition, compared to only 18% that focus on customer retention.
New customers are great, but businesses can be blinded by them, and start to neglect their existing customers. In fact, customer retention is imperative to any and every business for it to be able to build and grow. Harvard Business School suggests, that by increasing your retention rates by just 5%, you will increase your profits by 25%.
Therefore, by focusing on customer retention you can accelerate your business growth with a lower expenditure.
Research has also shown that when businesses perform focusing more on customer satisfaction, it leads to better financial outcome however, customer satisfaction is not just about retention.
Let’s discuss how customer retention works?
By providing an excellent customer experience, not only will your customer satisfaction increase along with your retention rates, but your happy customers will want to do more business with you which in turn will present opportunities to up sell.
Additionally, the best way to market your business, especially in Africa, is through word of mouth. By providing your customers with excellent customer service, your existing customers will be your best and most effective sales team as they will advocate for your business.
There are lots of ways mobile messaging is helping businesses provide an excellent customer experience:
- Transactional Messaging
Giving customers updates and information instantly when they need it through automated SMS.
- Customer Service
- Information and updates
Give your customers information when they need it, make them feel comfortable knowing that everything is under control.
To build on and improve your customer experience, you need to know two things:
- What customers like about your business.
- What areas they think you could improve on.
“Your most unhappy customers are your greatest source of learning” ~ Bill Gates
Mobile messaging can help when collecting this information. Obtaining customer feedback has always been a tough task, but mobile messaging has made this process easier for both businesses and customers. Research has found that by asking customers for their feedback via SMS rather than email response rates doubled, this could be down to the 98% open rate that SMS receives compared to the 22% open rate that email receives. Imagine what it would be via WhatsApp?
It’s important that businesses don’t forget about customer retention and aim to provide excellent customer experiences, as both will enable your business to grow and become more profitable.
If you would like to discuss how mobile messaging can help your business, please do get in touch with us: email@example.com or call us to set up a free account.
Sources: Harvard Business School, Econsultancy, SmartInsights