Customer Retention Marketing (CRM) can be referred as loyalty marketing. It is a type of marketing strategy followed by selling organizations to keep their customers engaged, happy and spending on their products. Simply CRM is nothing but acquiring business from a customer repeatedly for a long time. CRM involves Customer Lifetime Value (CLV), a prediction on the net profit attributed to long time relation with the customer. CLV found to increase overall revenue of a product or brand or service offered by a client. Customers can be engaged for a long time by delivering relevant service content to increase the CLV.
Importance of CRM
According to Bain and Co, a leading management and consulting firm found that the cost to attract new customers is 7 times more than the cost to retain existing ones. A research on CRM confirmed 5% increase in customer retention generated nearly 125% more profits. There is no doubt to say that focusing on acquisition of new customers, ignoring retention results a loss in profit margins and returns on a product.
Experts say that successful retention marketing involves building two-way relationships to engaging customers for a long time. Customer personalization is another fact that influences the profits of a business. According to the recent study conducted by Accenture Interactive, 75% of U.S. consumers liked companies personalizing them through messaging about offers and services. Similarly the e-tailing group found 41% of U.S. consumers buy more from retailers when they receive personalized emails. All these studies confirm the importance of personalization in customer retention marketing that to reap benefits of a business.
Important Strategies of Customer Retention Marketing
Studies on CRM resulted three effective ways to retain the customers through personalization. The three effective ways to retain the customers through personalization can be listed as Timing Optimization, Dynamic Offers and Product Recommendations.
Timing Optimization
Timing Optimization is nothing but the delivery of communications to the customer at the right stage in their lifecycle, at the right time of the day, and at the right frequency to increases customer spending and advocacy. Several studies suggested the overall best times and days to send an email, in reality varies from person to person, as does the frequency.
Dynamic Offers
Delivering offer related information through emails based on online behavioral history of the customer is known as personalized communication. It was found that sending dynamic offers through emails generated 48% higher revenue than other promotional emails.
Optimizing the promotions based on each shopper’s preferences and customer lifetime value (CLV) not only boosts conversions, it also helps widen the profit margins. Because, each customer gets motivated differently by different offers such as discounts. While one customer prefers to get a free shipping coupon, another would prefer to go for the 20% off deal.
Product Recommendations
The third important strategic way of CRM to increase their engagement with a particular brand is allowing the customer to make quicker purchasing decision on recommending relevant products that suits his needs. Sending personalized communications on relevant product recommendations leads to extend the customer lifetime value (CLV) by building stronger relationships.
Amazon and other e-commerce companies found that 29% consumers buy more from retailers when they were recommended with relevant products based on past browsing or buying behavior. Forrester Research, an influential research and advisory firm reported that 54% of retailers increased their average order value year over year utilizing the automated product recommendations.
CRM Strategies of Saroj Ads
Saroj Ads is an online advertising agency that implements all the above three important ways as a part of its CRM Strategies. The team of experts working with Saroj Ads analyzes the online behavior and transactional data to send personalized communication to customers on behalf of its clients. It analyzes the online behavior of the customer such as the time customer opens his mails, websites browsed to purchase the products to determine the best time and type of communication to send personalized communications as a part of timing optimization.
Saroj Ads motivates the customers to purchase the products by sending offers to the customer based on the unique customer profile generated on analyzing the online behavioral history. Team of CRM in Saroj Ads knows the type of incentive preferred by the customer through the unique profile generated for each customer. It offers right incentive to right customer to retain them through personalized dynamic offers, such as free shipping to the customers preferred to pay shipping charges.
Saroj Ads team of CRM experts works to know the wants of the customer before they prefer to choose a product by applying predictive analytics on the online purchasing and browsing behavior to improve the profit to its clients.