Customer Retention: 7 Ideas for Marketers

Customer Retention: 7 Ideas for Marketers

As marketers we are often so focused on new customer acquisition that we sometime forget to pay attention to the customers that we already have. That would be a massive mistake. It costs 6-7 times more to acquire a new customer than it does to keep an existing one. You are 4 times more likely to close business with an existing customer than you are with a new prospect. I recently brainstormed with a CEO about programs for their current customers both to improve customer retention as well as to drive new business – here are some of the ideas we came up with: 1/ Give your Newsletter a Kick in the Pants – We all get too much email. Your newsletter is going to have to kick ass just to get folks to open it, let alone take action. What could you give customers that would be so interesting, awesome or remarkable that they’ll say, “Yippie, the newsletter arrived today!” What works for you will depend on your market but I’ve seen good results with sample code, a customer spotlight feature, sharing industry data your customers don’t have access to, interviews with industry experts and video snippets of product managers or support folks sharing their favorite tips and tricks. I’m sure you could come up with a hundred other ideas. If your newsletter doesn’t feel like hard work to create, you could probably do better. 2/ Campaign to your Lost Customers – You are twice as likely to close business with a lost customer than you are with a new prospect. With close rates like that, you should...

A Zero Budget Customer Advisory Board

I’ve run customer advisory boards at big companies and loved them but I’ve generally avoided running one at a startup because of the costs.  Recently however I’ve helped a startup launch a customer advisory council with zero budget.  Here’s what we did. The Setup: Starting With the End in Mind First we laid out the goals for the customer advisory board.  The company in this case has a low-touch sales model and the over-arching goal of the advisory board was to establish deep executive relationships with a group of around 20 customers.  Our goals went far beyond gathering product feedback.  The goals: product feedback and input on upcoming product releases insight into shifts happening in the market, discussing shifts in the customer buying processes feedback on potential changes to pricing and bundles getting customers engaged in marketing activities such as case studies, speaking engagements and other PR opportunities. The Prep: Selecting Who to Invite Based on what we were looking for we decided we settled on the characteristics of the customers we would like to invite: fit into our target segments had been an active customer for at least a year did not have a major open customer support issue (to ensure the meetings didn’t become support sessions) The Offer: Invitations and Expectation Setting We discussed whether or not we would need to offer customers something in order to entice them into joining the board.  In the end we crafted a message that centered around our desire to work with them to understand their needs and serve them better.  The “reward” for taking part would be that their input...

Selling vs. Buying: A Marketing Wake-up Call

Last week I posted a New Marketing Framework which sparked a set of interesting conversations about how marketing is changing.  I believe that marketing needs to shift its focus from selling to helping customers buy and product marketing has a big role to play. The categories of marketing we’ve used traditionally have been very focused on “selling”.  The big 4 marketing groups-Branding, PR, Communications, and Product Marketing, reflect this inside-out, sales-oriented thinking.  Even at startups traditionally “marketing” has meant communications.  PR was outsourced to an agency and product marketing was assigned to product management where it was generally ignored.  Helping customers buy has not been a major focus for marketing. The world has changed a lot, particularly around how customers discover and evaluate products.  The result is a big shift in control of the sales process toward prospects and away from companies. For this reason marketing now has to shift from selling toward helping customers buy.  Here’s what’s changed: We don’t believe advertising (in fact we don’t believe much of anything companies tell us)- There was a time when if a company said they the best at something, we believed it.  But those claims weren’t always true so now we don’t believe what companies tell us anymore. Customers can broadcast to the world – They might be happy, they might be upset but they now have a way to broadcast their stories without going through any media gate-keepers. Prospects can easily communicate with each other – Before, during and after the sales cycle, potential customers can ask each other questions and learn about your offerings and your company in...

Top 5 Customer Retention Marketing Tactics

The probability of selling to an existing customer is 60-70%. The probability of selling to a new prospect is 5-20% (from Marketing Metrics).  Research also shows that a 10% increase in customer retention results in a 30% increase in the value of the company (from Bain and Co.)  Anyone working at a SaaS business knows that churn and customer renewals are critical metrics for the business.  Yet, many marketing plans are so focused on customer acquisition that they largely ignore customer retention. (note: I did a more recent post on this topic here: Customer Retention: 7 Ideas for Marketers) Here are some ideas to help you kick-start your customer retention marketing: Regular Communication with Customized Content and Special Offers – This is the cornerstone of any good customer retention program and careful attention should be paid here.  Most companies have some sort of newsletter to communicate with existing customers but fewer are actively making offers to their current install base that are customized according to what is already known about the customer.  This can be as simple as offering an upgrade at a special price to tiered discounts or preferred access to support or other resources. Customer service – Poor customer service accounts for 70% of customer loss.  Marketing should take that number very seriously and work with the support team to deliver content that can help service folks do their job.  In my experience many thorny customer service issues stem from a mismatch between the offering functionality and customer expectations.  Marketing can create content that can set customer expectations for functionality and performance to make sure there is...