Customer Retention: what it is and which strategies to use

In an increasingly digital environment, it becomes increasingly difficult to acquire new customers. This is why it is highly strategic to implement actions in order not to be abandoned by our current customers.

One of these is Customer Retention. The term “retention” really means “maintenance”, and in this case, it highlights the ability of a company to retain its buyers.

Customer retention is strongly linked to the concept of loyalty. The goal is to increase the brand loyalty of our consumers, leading them to become our ambassadors,

In the following article, we will see what Customer Retention is, how to do it, why it is important and what are the best strategies to implement it. To then conclude with Digital Coach proposals to increase your Customer retention, such as the online courses in digital marketing.

What is Customer Retention

The term Retention in marketing refers to the ability of a firm to retain its customers(Customer Retention) so they stay close to the brand. A retention strategy is implemented in particular when incentives are used to stimulate customers to try new products or repeat purchases.

The main role of Customer Retention is to create ambassadors, i.e. micro-influencers capable of implementing the greatest form of advertising, i.e. word of mouth between real people. But what are the tools for increasing customer retention?

How Customer Retention is done

The objective of Customer Retention, in addition to implementing strategies to obtain new customers, is to retain existing customers by trying to maintain a high level of interest and satisfaction with a company. The main way to convince your audience to become customers of your brand again is to establish a connection that remains fixed over time.

One of the main steps to do this is the one made available by email marketing techniques to send newsletters.

Starting from here you can start a workflow, based on email marketing automation and lead the customer toward the content marketing strategy path, cross-selling, and upselling.

Of course, in addition to email, there may also be other ways such as using social networks or blogs.

Why Customer Retention Matters

Today everyone talks about lead generation, i.e. the acquisition of new contacts from potential customers, but few dwell on Customer Retention, which as we have already mentioned above is the strategy capable of pushing the consumer to buy a second (third, fourth, etc. ) time, our products or services.

Acquiring new customers is important, but a company must also be able to “retain” them, for example by implementing digital loyalty. So, because it is increasingly important to implement a Customer Retention strategy?

1. Acquisition marketing, which primarily includes Lead Generation activities, has a much higher cost than retention marketing. 2. Old customers, those who have already made a first purchase and who make a second (but also third or fourth, etc) purchase, cover the 55% to 70% of a company’s total sales. 3. Today using tools of Search Engine Marketing and Social Media Marketing to bring traffic to the site, is much more difficult than it used to be. Each acquired customer, therefore, turns out to be valuable as over time it will generate a much higher return; retaining a customer turns out to be strategic with a view to profit in the long run.

customer retention in marketing

Of course, all this does not mean setting aside the marketing strategies to acquire new customers but adding to it a loyalty plan which integrates and completes itself with these to obtain a winning web marketing strategy.

In fact, acting on already loyal customers is easier:

  • A customer already acquired knows your brand and your products, therefore you don’t have to start from scratch to make the promotion happen, to make people understand what differentiates you from the competition and explain to them why your product or service is better than the others.
  • Those who have already bought from you and had a positive experience will continue to buy because believe in you and what you offer; a real relationship of trust is established between the seller and the customer. Furthermore, customers also become testimonials of your brand, and thanks to the so-called word of mouth they can bring you new contacts and customers in the company.

Benefits of Customer Retention

There Customer Retention has numerous advantages, some of which I have already mentioned in the previous chapters, but let’s summarize what they are:

  • Lower cost with respect to acquisition strategies. In fact, customer acquisition costs can be high and time-consuming, while the cost of retaining a customer can be lower and more profitable in the long run.
  • The overall increase in sales and therefore profits. Over time, customers get to know their suppliers. If the relationship with their supplier is satisfactory, the customer will be more inclined to rely on them, possibly also for other products or services.
  • Increased brand loyalty and consequently brand awareness, thanks to the ambassador activity of the most loyal customers.
  • When customers are satisfied they will be more prone to word of mouth which can influence the choices of other customers.
  • Customers are sometimes willing to pay a higher price thus rewarding their suppliers. Furthermore, if the perception of value no longer depends only on the price of the service, competitors will exert less appeal on “historical” customers.

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How to set up a retention strategy

A good Customer Retention strategy must start with the first contact that the company establishes with the customer and continue for the entire duration of the collaboration, through exchange relationships.

Making good one-retention marketing means exceeding customer expectations surprising them, offering high-quality services, and guaranteeing complete and constant support through scrupulous customer service.

It is also necessary to differentiate customers and operate by identifying those destined for Customer Retention. In fact, it is not beneficial to maintain relationships with all customers as some of them could look for a better price and constantly change suppliers, while others could involve too high maintenance costs.

Therefore, it is essential to choose customers, those who bring added value to which to dedicate a retention activity.

Customer Retention Strategies: how to retain your customers

Everything starts with a solid relationship between the company and the customer. How to build customer loyalty so that they do not abandon the company and make it clear that the latter is committed to satisfying the required needs in the best possible way?

Loyalty and keeping a customer is not easy at all. Sometimes, it’s not enough to offer the best product or service at affordable prices but something extra needs to be done.

This is where Customer Retention strategies come into play, designed to ensure that there are a minimum number of customers who leave your company to seek satisfaction elsewhere.

Here are some customer retention strategies:

1. Never stop selling

The moment a potential customer is converted into an actual customer, one must not abandon him, as he remains a person who needs attention, promotions, and reminders. This means that after so many efforts to reach the new customer, the company must not start ignoring him immediately after the first sale is made.

You must not stop selling your brand and remind customers of the reasons that led them to choose your company.

2. Don’t ignore customers

In addition to the telephone and e-mail address, customers can interact with the brand through all corporate channels, from Facebook to Twitter. When these ways are opened, they shouldn’t be ignored because for some businesses, such as e-commerce, not responding within 24 hours to a question asked by a customer on Facebook is equivalent to losing them forever.

3. Bring back customers who have left

Managing a new customer is by no means simple, as we know practically nothing about him; we don’t know what his needs are, what he might annoy, or what kind of offer he might accept. For this reason, you should spend a little more time recontacting those customers you haven’t heard from for quite some time in order to remind them of your company and inform you about what were the reasons that made them leave.

4. Schedule contacts with your customers

Another Retention strategy is to periodically schedule phone calls, thank you emails, letters, invitations to events, and special offers so that customers feel followed, informed, and valued.

5. Accept criticism

Many leave a business without giving an explanation, complaining, and criticizing. Let’s talk about companies ranging from e-commerce to restaurants.

Ex-customers may go and complain to others, saying that perhaps your company lacks in Customer Management, that prices are high, or that the types of wait are long.

So, those very few customers who, before leaving your company, complain, exposing their criticisms and complaints; those that actually say where to improve.

6. Share your company’s values

Building customer loyalty does not mean that you need to fill them with messages. What is important is not how much you share but what you share.

To ensure that the majority of the audience remains connected to your brand, you need to aim at sharing the company’s values, in order to create an emotional connection with your audience.

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How to keep your customers

Some studies have shown that there is a relationship between Customer Retention and Customer Experience. To “keep” its customers, a company must focus everything on improving the shopping experience. This way you have the opportunity to stand out from the competition, have a positive impact on the customer’s psychology, and be remembered.

So how to improve the customer experience and keep their customers?

1) Focus on the customer with the use of Email Marketing Automation.

Email can be considered the best way to retain a customer who has already purchased from us.

To make him feel special and show him our gratitude for choosing our company and offer him a personalized shopping experience, for example by sending incentives, bonuses, or offers on new products. We’re talking about email automation, which is non-invasive thanks to the fact that we can send emails with targeted and personalized content based on the customer and their interests. 2) Customer care

Customer assistance is one of the most important strengths in customer retention strategies.

In fact, if the customer has had a positive perception, i.e. kind, helpful but non-invasive assistance, he will certainly be a customer who will return.

So for this very reason, we need to think about customer care from the beginning of the sales funnel, ensuring that the buyer experience is of quality.

In addition to the efficiency of customer care, a drip marketing strategy must also be present, supported by a punctual and professional social media manager. 3) The brand as a point of reference

Consumers like to feel at the center of attention but above all identify with corporate values, and want to feel close to the brand and be reflected in its personality.

To do this, corporate social networks can be exploited, speaking clearly and directly, telling the story of the company and its products, and perhaps showing the creation and production phase of what we sell.

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And how would you manage the relationship with your customers? Are you aiming to involve them regularly or do you prefer to focus on new customers? Your customer retention?

If I have intrigued you and you want to learn more about how to manage a company’s social networks by learning the right strategies and converting a potential customer into an actual customer, you just have to take a look at the courses and certifications offered by Digital Coach. Here are some:

  1. Digital Marketing Course
  2. Social Media Marketing Course
  3. E-commerce Courses.

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