There are two primary strategies in business for growing your customer base- retention and acquisition. Both work if used wisely, and both are necessary for your business’s development. Understanding the strategies of customer retention and acquisition, and how they work together for your business, will go a long way towards expansion.
There are pros and cons to both strategies, and different businesses often place more emphasis on one strategy over another. It is worth taking the time to understand both. Retention of customers saves money, as it encourages developing current relationships instead of investing in new ones, and focuses on customer service. And solid retention of your customers is necessary to facilitate successful acquisition.
However, growth needs acquisition of new customers. It should go without saying that it is vital to your company’s sustainability and expansion to acquire as time goes on. It just takes strategic planning and effort to do so wisely.
In this guide, we will look at the benefits and considerations of both strategies.
Why does it matter to retain customers? Customers must trust your business and continue to come back to it in order for the company to thrive. Those who return are proof that a business has provided services which are valued and trusted.
Thus, to focus on ways to keep customers engaging and coming back is to focus on retention as a strategy for your business’s development. Every small business should have a plan of action for how they will work to maintain and encourage relationships and customer trust.
In the end, your retention strategy will make or break the business.
Successful customer retention can help you make acquisitions later, as it helps to prove that you care about maintaining relationships and strengthening connections. As long as you keep high standards for providing good, reliable customer service, it is far easier to sell to a current customer than to a new one.
Focusing on your customer service efforts is highly rewarding and essential to retaining customers. Putting significant time and effort into customer service quality shows, and it helps reinforce loyalty and the choice to return.
Not only does retention save money, as it focuses on maintaining founded relationships, but it is guaranteed to make an impact on your ratings and industry presence. There is much to be said for the strides a business can make by relying on the strength of its engagement with customers and of a loyal customer base.
The fact remains that acquisitions, of both customers and new partners, must be made to keep a business flourishing. Careful financing is just one part of acquiring lasting relationships that benefit both parties for the long term.
As with retention, a focus on relationships is also key.
What It Requires
Successful acquisition focuses on the relationships being forged and the effort you put into establishing connections that will last. Acquisitions require a flexible and robust plan of action to facilitate gaining new partnerships.
Always be sure to evaluate if you are ready for the responsibilities required of making acquisitions. Your business will be impacted by increased demands and it will be necessary to ascertain that you are equipped to handle it.
Using Both Strategies
Retention and acquisition do not have to be pitted against each other to work. In fact, both strategies are important to employ to ensure that your company has the greatest opportunity for growth and development. Taking the time to learn how to execute them is next once you learn why they are indispensable to your business.
How can you make sure you utilize these tactics for lasting success and growth? Look out for our upcoming blogs on customer retention and acquisition. Join the conversation here, whether you’re just getting started or have experiences to share with others!