Customer Retention Marketing Splash...

Imagine it’s the hottest day of August. Sweltering, muggy and humid. You stop by a friend’s house and he offers you a dip in his cool, refreshing, new pool. The only hitch: first you have to help him fill it – one bucket at a time. You’d rather run out and buy garden hose, but you agree to use a bucket.

Fifteen minutes later, after a lot of sweaty, back-breaking work you realize you’re not making much progress. Then you spot a hole in the pool and tell your friend.

“Yeah I know,” he says. “I guess we just need to fill it faster.”

You stare at him.

“You realize no matter how much water we put in, it’s only going to come back out, right?” you reply. He just cocks his head and looks confused.

Sound absurd? Not as absurd as you might think.

Many people call my marketing firm for help filling their “sales pool” but don’t have system in place to keep customers in the “pool”. Often I ask: “If we develop a marketing communications campaign to bring you new customers do you have a system in place to keep them buying from you or to get their referrals?” Usually they just cock their head and look confused.

Smart marketers know that it costs a lot more to get a new customer than it does to keep an existing customer. So, before they invest in a new customer marketing plan, they make sure they have an existing customer retention plan.

Increasing your customer retention by as little as 5 percent can boost profits by 25 to 80 percent, according to a classic article in Harvard Business Review.

So, it’s important to develop your Customer Retention Plan before you even launch your new Advertising Campaign.

What are you doing to increase repeat purchases, cross-sell, build brand loyalty or even gain referral business?

Be sure you plug all the holes in your pool.