Acquisition and Retention: Finding the Balance
In the relentless pursuit of business growth, marketers serve two sternly demanding masters: acquisition and retention. Stakeholders must decide if greater marketing funds and creative energies should be applied to winning new customers or — given that it’s generally accepted to be much easier — keeping existing ones loyal.
Based on the results of MarketingLab’s recent Consumer Services Engagement survey, the priorities are clear in most organizations: 63 percent of all participants spend the majority of their time securing new customers. And among the marketers responding in the study, that figure spikes to 77 percent.
Forty-seven consumer services companies participated in the survey, representing retail, food, telecom, automotive, education, and health/wellness sectors. When looking at the number of marketing programs these organizations launch each year, the dominance of “new money” programs was just as obviously pronounced, outnumbering retention two-to-one.
From data gleaned in the study and its experience working with a range of retail clients, MarketingLab has derived these best practices regarding the balance between acquisition and retention initiatives:
Focusing the bulk of budget on acquisition is commonplace. But make sure your retention programs are authentic and that they build the connection between your brand and your customers. A simple check can be, “Are you talking with your customers or are you talking at them?”
Social Media is a great way to get value out of smaller retention programs, connecting a loyal customer and their loyal friends with your brand. A quick and honest response to a complaint/concern can be as valuable as positive comments made by your biggest fans.
Getting good customer insights and consistently converting those insights into programs is essential. The two share a symbiotic relationship — one cannot effectively exist without the other. Collecting quality insights, which participants admitted was a struggle in itself, can be augmented with increased social and customer support monitoring. Consistently converting those insights is a tougher task.