As a business gradually loses customers, attracting new customers is vital to growth. Close to 44% of companies have a greater focus on customer acquisition versus 18% that focus on customer retention. Therefore you have a lot more competition when it comes to the pool of companies who are competing for the same potential customers. This means that the easiest ways to advertise are the ones that are oversaturated. Making email marketing and social media marketing effective, but over-flooded with other companies trying to do the same thing that can easily distract potential customers from your message.
Direct mail allows you to effectively advertise by putting your name in front of potential customers without them becoming distracted by other content. While it costs 5 times as much to acquire a new customer than keep an existing one, being able to effectively advertise allows you to lower that cost as much as possible. By using a medium that will be physically delivered, you will avoid being drowned out by all the information potential customers get delivered to them through digital mediums.
While most companies focus on growth through only customer acquisition, growth can also come from customer retention. Once you find an effective way to acquire new customers you want to make sure that you are keeping those customers. The most effective way to do this is by using mediums where you can follow up with the customer. The two best mediums to do this are email marketing and social media marketing. These both allow you to follow up to make sure that they are happy customers and will come back. By increasing customer retention rates by 5% you can increase profits by 25-95%.
By utilizing direct mail marketing for acquiring customers and email and social media marketing to retain them by following up, you can make the most of the different mediums. Focusing on both acquiring and retaining customers will allow you to grow at a faster pace and make more money. You also want to make sure to measure the customer’s lifetime value. This will allow you to accurately assess what you should be spending for both acquisition and retention.