In the age of eCommerce, it may sometimes seem like online shoppers are everywhere. Often marketers focus their efforts on attracting new customers and building their customer base. However, online shoppers are far harder to attract and walk through the sales funnel than you may think.

Meanwhile, if you’ve been focusing all your attention on acquiring new customers, you may have forgotten about the very important existing customers. This is why customer retention matters, since customers are hard to attract in the first place–once you’ve got them, keep them. In fact, the importance of customer retention goes beyond the difficulties of bringing in new customers.

CUSTOMER RETENTION MEANS BETTER SALES

Your existing customer base is one of the most valuable assets you have. Existing customers are far more likely to make bigger purchases and purchase more often than new customers. That's why if you increase your customer retention by just 5%, then your profits may increase by 25-95%. Existing customers account for the majority of your sales, so customer retention should be at the top of your priorities.

“We have tried many strategies in an effort to make our company as personal as possible, one of those being sending a thank you email to everyone that buys from us.

— William Schumacher, CEO and Founder of Uprising Food.

CUSTOMER RETENTION LEADS TO NEW CUSTOMERS

Existing customers are also a great asset for building your brand’s reputation. Loyal customers are more likely to recommend your brand than new customers. This is impactful because 84% of consumers around the world trust a friend’s recommendation over product information. Customer retention is beneficial in more ways than just word-of-mouth advertising; loyal customers can also be leveraged as a form of social proof online. You can always incentivize customers to leave reviews and rate your products and services. About 95% of people read reviews before making a purchase. These actions boost your brand’s credibility and reward your website’s SEO.

As we have entered into a relationship-centric business era, a brand’s relationship with existing customers is more important than ever. Online shoppers place their trust in reviews, ratings, and comments. 90% of Americans look at a brand’s customer service as a deciding factor in whether they will trust the company. If your brand is responsive to questions and comments and has a strong relationship with your customers, then prospective customers will view your brand more favorably.

“Customer retention is about relationships and experiences. You want them to have a good experience with your brand initially — this means providing a good product and service.

— Ravi Parikh, CEO, RoverPass

IN CONCLUSION

The wonderful thing about practices for retaining customers is that it creates your foundation for attracting new customers. If you have excellent customer service, customers will want to continue purchasing from you. These loyal customers are a great asset when it comes to boosting your sales and bringing in new customers. Customer retention is the gift that can keep on giving for your company.

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