‘’It’s a known fact that retaining your customers is more cost-effective than getting new customers”.
We know that it costs more to acquire new customers than to retain existing ones. So by offering a small gesture (and many of our ideas will cost you little-to-no money) you can yield big returns while increasing customer retention and gaining new ones in the act.
Depending on which study you believe in and what industry you’re in, acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one. It makes sense: you don’t have to spend time and resources going out and finding a new client, you just have to keep the one you have happy. You need to be convinced that retaining customers is so essential. Increasing customer retention rates by 5% increase profits by 25% to 95%.
The bottom line is keeping the right customers is valuable. One of the key metrics in understanding whether your company is retaining customers is customer churn rate. But what exactly is that? Churn rate, sometimes known as attrition rate, is the rate at which customers stop doing business with a company over a given period. Churn may also apply to the number of subscribers who cancel or don't renew a subscription. The higher your churn rate, the more customers stop buying from your business. The calculation of churn can be straightforward to start with.
Take the number of customers that you lost last quarter and divide that by the number of customers that you started with last quarter. The resulting percentage is your churn rate. You need to take note of this and then know the next step to take.
At Lightbulb Business Consulting, we have various marketing channels to retain and reach new customers. Contact our team today for more information