When I first thought about the importance of customer retention I thought it was a no brainer. When you keep customers, you get to keep eating. Pretty simple huh? But then I got to thinking about it a bit more and came up with a few more in depth reasons for the importance of customer retention.
This ties in directly with my last post on lower customer attrition by providing cost savings. Customer cost savings is a tool that I feel is imperative for every salesperson and sales manager to use to lower attrition and increase retention rates.
The Importance of Customer Retention
I started off saying, when you keep customers, you get to eat. They are the ones who provide you with the means to buy groceries, pay your bills, take vacations and simply live your life as you know it. Without customers, you have no paycheck.
As simple as this may sound, in my opinion, this one tops the list of the importance of customer retention. Keep your customers happy, they keep buying, you keep getting paid. If that is not important, then what is?
The Reasons Customer Retention is Important
1. You get a paycheck. No customers, no paycheck.
2. Stay in business. Whether you are the owner or employee, retaining customers means you get to stay in business.
3. Your competition has less. If you retain all of your customers, that means they don’t jump ship and go with your competition.
4. Building loyalty. This one is tricky. You build loyalty, your customers stay with you. Retaining customers gives you the opportunity to build stronger bonds and loyalty.
5. You get referrals. When you build loyalty and retain your customers, you get referrals. Your customers will tell others how good you treat them and the end result is you gain new customers.
These are my top five reasons and the importance of customer retention. If you have other reasons of how important it is, leave me a note below. I would love to hear from you. When you do, I’ll share it with everyone.