Marketers today juggle a number of objectives. Increase retention rates and LTV. Learn more about the customer while navigating data privacy laws. Be more impactful with fewer resources. Find ways to catch customers’ attention through noisy news feeds. Meet customer expectations.
Getting retention right isn’t easy. Today, retention matters more than ever, and marketers are looking for new tools and strategies to keep customers continually engaging with their brand. Based on our recent research and the marketers we talk with each day, here are their top challenges — and new strategies to overcome them.
A Retention Marketer’s Top Challenges
How do you keep customers excited about your brand and continue to engage? According to our recent “State of B2C Customer Retention” report, the biggest challenge to retention marketers is meeting the expectations of their customers. And they expect a lot these days. 71% of consumers expect that a brand will offer them a personalized experience. 66% of consumers expect brands to understand their unique needs. They expect great products and services. They want someone to reply to their questions when they message. Customers are simply looking to build a relationship with the brands they love. And if those expectations aren’t met, customers will build relationships elsewhere. So how can you build better relationships?
Having limited budgets and resources is another major challenge to retention marketing. The idea of ‘growth at any cost’ is dead, likely because the resources aren’t available. Today, it’s all about efficiency. So how can marketers be more efficient in retaining customers?
Another challenge is managing customer data. Between data privacy regulations, iOS privacy updates, and the anonymity of using third-party tools to target audiences, it’s hard to gather actionable information about your customers. Are there better ways to collect and manage data?
For retention marketers, it all comes back to understanding the customer and knowing how to keep them engaged. But not having a modern retention strategy can leave marketers unable to meet their customers’ expectations.
Overcoming the Challenges to Retention Marketing
When it comes to achieving your retention goals, it always comes back to basics. Know your customer. Engage them where they are. Meet their needs. Here are five steps to better retention.
1: Make retention the core of your marketing strategy
Considering that it’s cheaper to retain a customer than acquire a new one, companies are prioritizing retention marketing as a more efficient strategy to help grow revenue in a challenging economic environment. Going forward, make retention the core of your marketing strategy. Identify opportunities to develop your team’s capabilities and competency for growing LTV. Evaluate your tech stack to identify which tools are working and which new tools you need to invest in. Finally, share your retention plan widely, articulate your KPIs, and show your retention efforts’ positive impact on revenue.
2: Meet customers where they are in two-way channels
Customers are looking for personalized experiences with brands on the channels where they already spend their time. In order to meet their expectations for unique, individualized interactions, reassess your retention strategies to focus on meeting them there. Identify channels that offer two-way engagement — like social media and messaging apps — so that you can invite them into a conversation. Using automation allows you to have an always-on approach to messaging so customers can interact with your brand whenever they want to. And retargeting is as easy as sending another message to pick up the conversation.
3: Collect and act on zero-party data
One of the biggest challenges to marketers is collecting, managing, and acting on customer data, especially with the data privacy and iOS restrictions in place today. A great solution is to look at methods of collecting zero- and first-party data, or data given to you by the customer directly. This is another benefit of engaging with customers through one-to-one messaging: the data they give you directly is yours to keep.
Use zero- and first-party data to build meaningful segments based on real people and their interests — not transactional, anonymous, behavior-based segments. Despite rising privacy laws and regulations, customers are willing to give brands their information in privacy-safe ways if it’ll be used to improve their experience.
4: Stack new retention channels that enable two-way communication
Many marketers today still rely on email as a major channel. And while it’s usually still a top performing channel, email is a one-way communication with your customers. There’s no conversation, and you may not even know who they are — they’re just a name on a list. This is why marketers who want to increase their retention should look to add new channels that allow for that two-way communication.
Social media and messaging app platforms allow for more personalized, one-to-one methods to engage with customers. Go where your customers are and engage with them there, especially with younger audiences on the platforms they prefer. Grow your messaging contact list on these channels to offset dwindling email performance. Like any diversified portfolio, having a thoughtful channel mix leads to increasing incremental revenue gains today and better preparation for the future.
5: Invest more in retention marketing tech
Automation tools, platforms to manage customer data, analysis tools. Marketers don’t just need a modern approach to retention, but they need modern tools as well that can automatically target their customers with ongoing relevant content, offers, and updates. According to our report, retention tech is generating a positive ROI for 90% of those surveyed. The fact that the right tech tools can help increase retention — and given retention’s positive impact on revenue — makes it easy to make the case for updating old technology or an expanded budget.
Overcoming Retention Challenges Today
Marketers today are juggling a number of objectives in their efforts to build LTV and long-lasting relationships with customers. With a focus on using two-way channels, meeting customer expectations for personalization, and gathering declared data, you can build a great growth plan for the future.