Getting new customers is expensive. Between the investment in marketing, conversion experience, and servicing an initial engagement, a brand’s cost per customer acquisition can have a significant impact on its profit margin. Which is why it boggles our mind that brands spend boatloads of money on winning over new customers, but don’t realize it’s equally important to invest in retaining current customers to decrease your churn rate. Today’s post explores four ways that you can use advocacy marketing to strengthen your customer retention strategies.
Why Should Brands Care About Customer Retention?
So, why should your brand focus on customer retention? Because repeat customers are significantly more profitable than new customers. Recent studies have shown that it costs brands 5x as much to acquire a new customer as it does to retain an existing customer.
Need some more proof? Studies have found that a 5% increase in customer retention can increase profits anywhere from 25%-95%.
How to Use Advocacy Marketing to Build Customer Retention
A study from Accenture found that 80% of lost customers felt that a brand could have done something to prevent them from abandoning the brand. The lesson here? It’s the responsibility of the brand to make an effort to retain their customer base. Not the customer. Enter advocacy marketing.
4 Ways Advocacy Marketing Can Build Customer Retention
1) Consistently Share High-Value Content
Looking for a shortcut to building customer loyalty and retention? Consistently exceed your customers’ expectations. One of the core benefits of advocacy marketing is that it gives brands a streamlined process for distributing their marketing content.
Whether it’s new blog posts, fun videos, or an engaging podcast, brands can use their advocacy marketing program to share their latest content with their brand fans and existing customers. Each piece of content shared provides your customers with an opportunity to positively engage with your brand and learn more about your company. The more positive exchanges an advocate has with your brand, the more likely they are to continue to engage with your brand over time.
2) Dialogue With Your Customers
Strong customer relationships aren’t built on monologues. To foster brand loyalty and increase customer retention, brands need to dialogue with their existing customers. In other words, brands need to give their customers an opportunity to provide feedback and input and know that the brand is actively listening to this provided feedback/input.
SocialToaster makes it easy for brands to engage in a dialogue with their existing advocates through built-in survey and quiz functionality. Brands who manage their advocacy marketing efforts through SocialToaster can use surveys and quizzes to garner customer insight into a host of topics from new product development to improving the customer experience.
3) Strengthen Your Social Media Community
As your advocates receive your new content pieces, they’ll have the opportunity to share that content onto their personal news feeds for their friends and family to enjoy. Not only can this help to elevate the social status of your advocate (they’re always in the know), but it can also help to re-engage with former customers that may have abandoned your brand.
Brands can also use their advocacy marketing effort to encourage their existing customers to create user-generated content on behalf of their brand. There’s a certain type of loyalty-building magic that happens when a customer takes the time out of their busy day to engage with your brand and create content on your behalf.
You can learn more about user-generated content by checking out our blog post here.
4) Gamify Your Advocacy Efforts
How do you keep your customer base engaged over months or years? Gamify your advocacy efforts. Studies show that companies that tie a gamification element into their customer experience see an increase of 47% in client engagement and 22% in brand loyalty.
So, how can you gamify your advocacy marketing program?
- Create badges that your advocates can earn when they complete individual advocacy efforts.
- Tier your advocacy marketing program into different statuses and provide your top advocates with a premium experience.
- Incentivize your program and reward active participants with cool prizes
- Allow your advocates to ‘unlock” unique promotions or discounts by participating in your program.
Most importantly, remember to make your program fun and enjoyable. It’s called “game”-ification for a reason.
Ready to Drive Retention?
Tired of churn-and-burn customer antics? Ready to make customers for life? Reach out to SocialToaster today to learn more about how our award-winning advocacy marketing program can help you retain and grow your existing customer base.