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03/03/2016:  3 Reasons for Retention Marketing


Tiffany Lange - Headshot - Senior Account Manager - BluewaterRetention marketing is receiving a lot more attention these days. It used to be that businesses focused their budgets primarily on acquiring new customers. Not anymore. Businesses are now dedicating people and creating technology platforms and budgets to market to their current customers instead of focusing only on acquiring new ones.


What is the purpose of retention marketing?

– To keep customers happy
– To encourage future spending

According to a widely distributed study from Bain & Company, increasing customer retention by just 5% could yield anywhere between a 25 and 95 percent increase in profits.

What are the top 3 reasons your business should be executing retention marketing campaigns?


1. Retention marketing increases the frequency in which a customer buys from you. Using retention marketing in combination with acquisition campaigns, increases the customer lifetime value. As Alex McEachern writes in “What is Retention Marketing, and Why you Need to Start Today,” retention marketing will “lead to long term profitability, rather than short term acquisition gains”.

2. If your business is established then chances are that it is cheaper and faster for you to retainretention marketing your current customer base. It costs five times as much to acquire a new customer than to keep an existing one. That is not to say that you should stop marketing to new customers. Rather the two methods need to be used together.

3. It is a lot easier to retain current customers than acquire a new customer. According to Marketing Metrics, the probability of converting an existing customer is 60 to 70%! Comparably, the probability of converting a new prospect, is only 5 to 20%. These numbers are not surprising. People tend to respond to companies they have had an experience with rather than to ones they have not.

Does your company execute retention marketing campaigns? If so, have you found them continually successful? If you have questions or comments, feel free to share below or tweet us @BluewaterBrand — we’d love to hear from you!

About Tiffany Lange
Tiffany Lange

One of the original members of the Bluewater family, Tiffany is Bluewater's Senior Account Manager. She provides complete local marketing support for our franchisees, from individual campaign planning to overall account management. When she's not busy with franchisees, Tiffany loves spending time with her family, and gardening during the beautiful Minnesota summers!

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