In the B2B industries, it’s easy to lose touch with the end-user or customer. Agencies and firms are always eager to expand their clients’ customer count if it means more revenue for them, so they dump money into acquisition strategies for clients and, in the process, overlook the existing customer relationships that need nurturing. This common oversight can result in a domino effect of churn: the business client loses customers… and eventually, the agency loses that client.
This all-too-common mistake can be deadly. Luckily, the solution is simple: when you help your customers keep their customers through heightened retention efforts, you’re more likely to keep them too. Research has shown that acquiring a new customer costs (at the very least) 4 times as much as keeping an existing one. This gap is so pronounced, companies have scrambled to build customer success teams and radically transformed their client communications to drive loyalty.
Interestingly, this business strategy is one of the few that benefits the customer just as it does the business, from customer satisfaction initiatives to loyalty programs to just extra attention paid to the ones who keep coming back. Loyal customers are good for more than just an upsell. When their loyalty is affirmed and rewarded, they respond with even greater loyalty; they’re more receptive and understanding with employees and less likely to raise complaints.
Think of the value difference between your close friends and acquaintances—a handful of intimate friendships is more valuable than dozens of acquaintances, not to mention far more sustainable (unless you were born a star socialite). Similarly, you and your loyal customers stand to benefit greatly when you invest just a little more in them.
Even further, when you ignore the importance of retention, you’re not just losing out on potential revenue from existing customers—you’re handing off leads to the competition who isn’t ignoring it. You do them the generous favor of characterizing them as the company that “cares about customers” and yours as the one that, well, doesn’t. Regardless of how invalid that assumption is, it’s one customer is very ready to make when they feel discarded after the initial sale. Even if your competition’s retention efforts are purely upsell-driven, their individualized approach will highlight what your business model is lacking.
Retention efforts don’t have to start huge. Begin by retargeting some of that acquisition effort on current customers. Offer discounts and packages, establish reward programs and seek out customer feedback. But more importantly, help your clients do the same. Provide services like mobile apps that drive return business and customer engagement. After all, a client’s client saved is a client earned.