Tag Archives: keeping customers happy

Cost of Acquiring New Customers vs. Retaining

Illustration of happy customer.

Illustration of happy customer.

Did you know that it costs 6-7-times more to get a new customer than retain one? It sounds unreal, but it’s true. The cost of acquiring new customers in today’s competitive market is extremely high to the extent that businesses are better off committing resources to retention campaigns. Some statistics even show that whereas you’re 60-70% likely to see a repeat purchase from existing customers, there’s only a 20-30% chance of selling to a new customer.

Ultimately, most businesses survive on purchases from a small group of loyal customers. According to Marketing Insights, 80% of a business’s profits come from 20% of the company’s existing customers.

Signal Mind delves deeper into these stats to help SMBs understand the value of customer retention and, after that, offers several tips to boost customer loyalty. The following are a few key takeaways from the blog.

Acquiring New Customers vs. Retaining

  • The average conversion rate from promotions sent to new customers is less than 1%.
  • Loyal customers are worth up to 10 times more than their first purchase, on average.
  • Retaining just 5% of your customers can increase your profitability by more than 25%.
  • A 10% rise in customer retention can yield a 30% increase in company value.

Check out the Signal Mind blog to learn more about customer acquisition vs. retention costs and the benefits of building a robust customer loyalty program.

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Customer Service Myths

Customer-Service-Myths-700

Customer-Service-Myths-700In the current Internet-driven world, customers are more powerful than ever. When customers have a positive experience, they share it with their friends and family. This leads to new business. But what happens when customers don’t have a positive experience? They complain.

While customer complaints highlight a problem, listening to these problems can help a business owner to improve.

Understanding Customer Service Myths

Myth 1: Fewer Complaints Means Customers Are Enjoying Services

Fact: No news isn’t always good news. Fewer complaints may also mean a large number of silent unhappy clients. In fact, 70 to 90% of unsatisfied customers won’t voice their complaints before they leave a business.

Tip: Track and research complaints vigorously. When complaints go down, check whether accessibility has been reduced. Interact more with customers to determine the real number of problems and make improvements.

Myth 2: More Complaints Means Lower Profits

Fact: Few business owners are serious about this issue. Most of them want to determine the main problem to reduce the high number of complaint calls. However, a high number of calls may not always harm profits.

Tip: Business owners should view customer complaints as an opportunity to improve their products and services. They can only do this by listening to complaints and feedback.

For a business to achieve brand loyalty, it has to focus on the right customer service metrics. Check out this infographic from the folks at Salesforce to learn more customer service myths.

Customer-Service-Myths_01

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