Find New Customers But Keep The Old – One Is Silver And The Other Is Gold

Michael Brenner on Jan 23, 2017 in Marketing Strategy

Sometimes browsing the latest trends in marketing can be like walking through a carnival. There are plenty of half-baked ideas, and digital obsessions beefed up with content marketing lingo like an MMA fighter on steroids.

But not the meaty answers that you seek.

Do you feel like this? Then it may be time to get back to the fundamentals. Time to forget about the shiny objects for a minute. Ditch the latest tricks. At least for today.

It’s time to look to where marketing’s purest truths can be found. . .

Childhood nursery rhymes.

Make new friends, but keep the old. One is silver, and the other gold.

Are you spending enough energy on retaining your existing customer base, your true gold?

Or, are you focusing your content marketing strategies on new leads, the less valuable yet shimmering silver target?

Don’t Neglect Your Gold Customers

It is time to make churn rate and customer retention a priority again. Churning is when you lose your existing customers. A low churn rate means you are able to keep most of the customers that your company does business with.

Your job is to get that churn rate down as much as possible. That means customers are not:

  • Closing their accounts
  • Choosing to purchase from a competitor
  • Canceling their subscriptions
  • Not renewing their service agreements

After all, it is well known that it is astronomically more expensive to find new customers than it is to market to past ones. It can cost from 5 to 25 times more to win over that new lead than to keep an old one, which is why customer retention and reducing churn is a central focus for leading marketers.

Old Customers Will Create the Most New Business

Not only is it more expensive to chase new leads but your loyal customers are the ones who are probably going to be behind future revenue growth. Many of today’s CEOs are putting more pressure on CMOs to include revenue growth on their already lengthy to-do lists. Need to prove your marketing worth through revenue growth?

No problem. Your customer base can help.

Think of your loyal customers as your Praetorian Guard. They are there for you. They’ll make sure you are victorious each day. According to research agency, Gartner Group, a hefty chunk of a company’s future revenue growth, about 80%, will come from a modest and dependable 20% portion of their existing customers.

Just make sure you keep them happy.

Loyal Customers Deserve the Gold Treatment

How do you retain your customers? Simple, treat them like the gold that they are.

1. Create a loyalty program that makes them feel special. To keep your loyal customers loyal, let them eat cake! Offer a simple, straightforward rewards program that truly adds value.

Think Virgin Atlantic’s Flying Club classic tier-based program or Sephora’s exclusive Beauty Insider program, which offers customers more than deals. Beauty aficionados can get their hands on limited-edition sets and free samples – prized swag that those pricey new leads don’t have access to.

2. Listen. Retaining customers is a lot like working to maintain a healthy relationship. Aside from letting them know how special they are, marketers also need to do something that may take practice. Listening. Read the feedback posted on social media channels, reviews, and in customer emails. What are people saying about the products or services you are trying to sell? What are the subtle messages behind the politeness or frustration?

The more you pay attention, to the good and the bad, the more you can learn about your existing customers and create those insightful buyer personas so you can master the next method for getting your churn rate down.

3. Communicate like you know who you are talking to. This is where you need to find the perfect balance between marketing automation and personalized communication. To make consumers feel like they matter, like they are being directly reached out to by their favorite brands, you’ve got to speak to them.

The best marketers don’t reach out to customer X. They send an email to Marcia LovesYourServices. She is a woman in her mid 40’s who doesn’t have a lot of free time. But she does enjoy treating herself to your service/product once every couple of months.

Or Fred Can’tGetEnoughofYourProduct, who is an avid industry enthusiast and appreciates being kept up-to-date with the latest industry news.

4. Chase your churners. You’ll get more value out of following up with the customers you lose than you will out of finding new customers to replace your churners with.

If someone cancels, switches to a competitor, or closes their account, politely and respectively, find out why. You can use this feedback. It can help you prevent your churn rate from growing by showing you how to make sure others don’t follow suit.

Maybe a new competitor popped up and is offering a better deal. Are some customers finding a problem with your product?

These are gems of information that marketers need to be aware of. All of a business’s lost customers may not feel inclined to respond. Some, however, will be happy to give away their two cents.

Old Customers Can Find You New Customers

Another advantage of fortifying the interest and loyalty of your existing customers is the referral phenomena.

Repeat customers who derive value from what a business is selling are your best marketers. Through their raving online reviews, social shares, and word-of-mouth, they are capable of much more than their purchases alone.

In fact, word-of-mouth is known to be the driving force behind between 20% and 50% of purchasing choices.

Marketers who want record-breaking ROI need to balance old and new, with digital marketing ingenuity. It is well worth your time to focus on making sure your existing customers are happy, finding out if and how their expectations are changing, and letting them know that they are valued.

Customer retention is a foundational pillar of successful marketing. It will attract revenue like a magnet.

Make sure your loyal customer base gets its fair share of your marketing efforts and make this an ongoing process. Then, go ahead, explore the latest trends in digital and content marketing.

image: pixabay

Michael Brenner
Michael Brenner
Michael Brenner is a globally-recognized keynote speaker, author of The Content Formula and the CEO of Marketing Insider Group. He has worked in leadership positions in sales and marketing for global brands like SAP and Nielsen, as well as for thriving startups. Today, Michael shares his passion on leadership and marketing strategies that deliver customer value and business impact. He is recognized by the Huffington Post as a Top Business Keynote Speaker and a top CMO influencer by Forbes. Please follow him on LinkedIn, Twitter, or Facebook and Subscribe here for regular updates.
Comments
  • Abigail

    Great tips. Thanks Michael!