The importance of retaining users and the value of a lifelong customer cannot be overstated. In fact, some businesses are sustained simply by being experts in customer retention, finding it unnecessary to acquire new customers. Although this is usually limited to high net-worth individuals’ money managers, the rest of us are forced to woo our customers into staying with the company.
How, then, can a company stand out and offer the human touch that customers so desperately want? The cost to acquire a new customer is much higher than the cost to retain an existing customer since previous customers are 60%-70% more likely to purchase than a new customer.
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Building Customer Loyalty
The relationship between a business and a customer is oftentimes cold, disconnected, and inhuman. When a company makes a great first impression through an extraordinary product experience or simply spectacular customer service, the companyâ€™s ethos has a lasting impact. Through the law of reciprocity, this customer will likely make an effort to return the favor by continuing to patronize the business.
Customers who are loyal to businesses are more vocal and evangelical about the brand. These customers are your true brand loyalists who drive word of mouth marketing. Businesses who continue to honor and respect every customer will maintain this trust and loyalty.
The customer lifetime value is the projected profit from a customer over the lifespan of their business relationship with the company. Only through customer retention will you be able to increase the lifetime value of your customers.
In the visual below, CleverTap covers how building customer retention is like dating and getting engaged. They include app retention stats and tips to increase the long-term relationship status between your company and your customer.
With app retention rates as small as the online dater’s attention span, your push notifications must impress well after the honeymoon period ends.
Here are push notification tips for a healthy long-term relationship with your users.
Mobile App Retention Statistics
- 90% of Daily Active Users are gone within 30 days of install.
- 23% of mobile apps are used only once.
- Average smartphone users engage with only 9 apps per day.
A Relationship Built on App Loyalty
- First Impression: Get your users acquainted with the UI and get them to the “wow” moment early so they fall in love with your core features.
- Stand Out: 66% of users feel they can accomplish the same goal on the mobile website as the app. Offer a value proposition that separates the app experience from the website.
- Offer to Pay: Present the user with something of value before they exit the app, leaving a lasting impression.
Rules for Reaching Out
- Timing and Frequency: Don’t overwhelm the user with too many messages too soon.
- Personalization:Â Basic personalization has been found to boost engagement by almost 10%.
- Incentivizing Action:Â Offer a financial or informational incentive with a clear call to action.
- Time-sensitivity:Â Give the user a time frame in which to take action.
Nurture the Relationship
- Use Push Notifications: Out of sight, out of mind. Communicate with users when they are not in the app.
- Inform, Not Overwhelm: In-App Messages, email, and SMS all have their time and place. Do not overwhelm users through every channel.
- Make Memories: Know what actions the users have performed, where they dropped off, and where users are in the funnel to re-engage them.
- They Said Yes: The probability of converting an existing customer is 60-70%.
- Retain: A 5% increase in retention can result in a 25% to 95% increase in profits.