Customer acquisition and customer retention are two important business activities that companies have been focusing on lately.
Around 44% of companies report that they focus more on customer acquisition, while 18% concentrate on retention. The rest say they focus on both equally. But based on studies, customer retention can bring so many benefits to a business — plus, it costs more to acquire new customers than to retain them. But what’s the difference and why is customer retention better?
First, let’s look at the definitions.
What is Customer Retention?
Customer retention refers to strategies and tactics that businesses implement to lessen customer churn. This method is important. Organizations and businesses implement this strategy because getting new profitable customers is a long and expensive process for businesses, on top of high advertising costs.
There’s also more to customer retention than just answering phone calls and helping them on board with your business. This method is about creating a seamless process from the very start that fosters fluid communication, trust, and mutual growth.
How Customer Retention Affects Your Business
Customer retention increases the “lifetime value” of your customers. And it can also boost your revenue. This method also helps you build meaningful relationships with your customers and creates a lasting impression that your business is more than just another store or website.
With this method, it’s easier for your customers to trust you with their money because of the value you give them in exchange. Trust breeds loyalty and loyalty breeds profit.
Not only is loyalty cheaper, but it also gives better returns. According to studies, engaged consumers purchase 90% more frequently, spend 60% more per transaction, and are five times more likely to do more purchases in the future. On average, loyal customers deliver 23% more revenue and profit than any other customer.
Loyal customers are more beneficial for your business but don’t take their loyalty for granted. For example, while loyal customers are more open to price increases, you should be careful about raising your prices simply to test how long they’ll stick around. This can discourage some loyal customers from buying again. Remember, lifetime revenue should always be the end goal.
How CRM helps in Customer Retention
According to research, customer experiences can improve customer retention rates by just 5% and increase profits by 25% to 95%.
The basic objective of a customer relationship management (CRM) solution is to improve your customer retention. Increasing customer acquisition at a low cost comes in second. Lastly, a CRM software’s objective is to make work seamless without risking any existing customer relations and ensuring a smooth transition of a new customer to becoming a loyal, long-term client.
But, more than that, here’s how CRM helps in customer retention.
Makes a comprehensive view of the “customer journey” map
Gathering customer data is essential, as it helps keep an eye on the impacts of your marketing campaign strategy vis-a-vis customer interaction. When you are able to gather data in real-time, you will be able to track the needs and demands of your target audience.
Collecting raw data is just the first step in initiating better experiences with your customers. Mapping the customer journey is the next step, as it helps record important focal points of your customer’s experience: from the initial contact (awareness), then the process of engagement (convincing the customer to purchase), then to a long-lasting customer relationship (post-purchase involvement).
CRM tools can help provide you an insight into the focal points of each consumer interaction and post-purchase meetings, and in data gathering across the customer journey map. The results will help you evaluate the strengths and weaknesses of your marketing strategy. It can also provide guidelines on how to re-engage the customer if your rate of engagement has been poor.
A CRM software can help you see your customer beyond the routines of acquiring revenue. The effects of personalization can greatly impact the relationship during the purchasing stage and post-purchase stage — where it is equally essential to reach out to customers regularly, to increase the value of your service.
Recent research has found that personalization, user preferences, and other related information in a CRM software can deliver a high impact ROI. CRM can also cover new target bases.
When customer feedback is good, your product and services are more likely to be promoted on various platforms. This increases brand interest in untapped channels. And with more information gathered by your system, you will be able to adjust and fine-tune your follow-up strategies accordingly.
Why Choose a SaaS CRM like Saphyte?
SaaS (Software as a Service) are platforms or a type of software that runs on the cloud. This means that the software is not stored on your company’s servers. Rather, it is hosted and managed externally by the software or solutions provider.
One advantage of using Saphyte as a SaaS CRM is that you can have 24/7 access, no installation or maintenance costs needed, and you can integrate all your business systems into the system. Thus, allowing you to have more mobility as a team.
More than that, here are some notable features of Saphyte:
Seamless Data Storage
Everything in your business starts with data. A CRM has contact management features that can provide a central, secure warehouse to store countless customer data.
You can gather data from the landing pages of your website or your social media platforms. With Saphyte’s features like Sync, Saphyte Scan, and Form Builders, you can extract data from different sources and, at the same time, keep your data in one centralized repository for easy data management.
From there, you can have access to relevant information so you can execute your strategies and back them up with data.
Close more deals
By using a CRM system like Saphyte, knowing your leads quickly and accurately is made easy. Classifying your leads is necessary so you can customize your content like your sales pitches. With Saphyte’s Client Management modules, you can store your contact’s details and manage all customer information in one repository.
The Client Management modules have features like Categorization, Status and Updates, where you can conveniently organize and label your clients by grouping them. With these modules, you can automate your processes, organize your data, manage your daily tasks, generate reports, and nurture your client relationships.
Saphyte can analyze customer information and other sales-relevant data using Sales intelligence tools.
With Saphyte’s customizable dashboard, you can have a summarized view of the metrics that matters to you, so you’re always up-to-date. This feature can arm you with information that lets you successfully implement your retention strategies.
Custom Email Marketing Campaigns
Make your emails look official and professional with Saphyte’s Email Templates. With Saphyte, you can create your own email design and layout and save it as a template. So, whenever you want to send an email, you do not have to create a design from scratch and do it all over again.
Product Catalog Management feature allows you to consolidate all your products into one catalog. Users can easily categorize, organize, and standardize all their product information across all their sales channels with this feature. Hence, you can set your customer’s expectations and make sure that your customers will have detailed and consistent information about your products and services.
You can now automate the sending of your email marketing materials on a schedule that works around your sales cycle. Saphyte’s workflow is useful when you want to send a newsletter or a promotion to your targeted list consistently with minimal effort.
The intelligent workflows allow you to set up and automate your business processes. With a user-friendly interface, all you have to do is drag and drop the elements, click and connect the nodes and elements in your workflow sheet, and build your email process seamlessly.
Subscription Fees that Fit with your Business
Saphyte is pay-as-you-go cloud-based CRM. Each subscription plan is inclusive of a free demo and a one-on-one product training. No set-up fees, no extra or hidden charges, no maintenance fees, and a 24/7 expert customer support availability.
Whether you’re a small business or an enterprise, having a CRM like Saphyte can be beneficial in your customer retention strategy execution. Start investing with Saphyte now by booking a free demo or by starting your free trial today.