Retention Marketing: Definition, Importance, Tips, Strategies

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This article guides you through the concept of retention marketing, the benefits and importance of retention marketing, offers you tips/pointers for effective retention marketing, and discusses the various retention marketing strategies you can apply in your business to realize the benefits that accrue from it.


Retention marketing is sometimes called Loyalty Marketing or Lifecycle Marketing. Retention marketing is a term that basically boils down to keeping your clients or consumers happy and spending on you.

Through the provision of high quality products or services, you will be able increase the Consumer Lifetime Value (CLV) and the overall revenue of your business. In business, it has come to be a commonly agreed fact that it is significantly harder to attract new clients than to keep those you already have. In addition to this, retaining just a fraction of your existing consumers is much more beneficial than new client acquisition.

Overlooking consumer retention and focusing on client acquisition agitates your existent consumer base and may even lead to loss of revenue for your business. For this reason, smart businesses people today are placing a keen focus on retention marketing.

Successful retention marketing demands that you build a two-way relationship with your consumers. Retention marketing furnish your business with an insight into consumer perspectives. This is possible because consumer retention encourages the business to gather data and create consumer personas that the business can use to act upon the consumers’ interests and needs. Additionally, retention marketing breeds consumer loyalty and loyal consumers always give you feedback, telling you how you could provide them with better products and services.

The way to successful consumer engagement is personalization. In fact, in the current business world, it is the consumers who demand personalization from business entities. Consumers become active and engaged when your business personalizes the consumer experience, making it more relevant to the individual.

In the recent past, sales were simply that; sales. However, with advances in technology, businesses have been able to diversify their messages in countless ways. For example, messages can be designed to target potential clients, partners, or current consumers.

The motivating factor in sales in the past was to get as many products and services purchased without any particular classification of the consumers. It did not matter as long as the products of your business kept moving.

Retention marketing, on the other hand, encourages us to identify our loyal consumers and target them in order to retain them in our business. This is opposed to the past business trend of shooting in the dark with our marketing strategies and hoping to capture as many consumers as we can.

Technology has made it easier to gather information, identify the targeted parties and tailor our marketing approaches to suit that group of individuals. That group, for the purposes of this article, is your existent consumer base.

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As a result, traditional business approaches in sales and marketing have become somewhat crude. Although most marketing strategies remain focused on those approaches, for example, consumer acquisition, most organizations are beginning to focus on their current consumers through avenues such as social media platforms. In addition, organizations are allocating a substantial part of their budget to marketing to their existing consumer base.

Retention marketing is driven by the following vital goals:

  • Keeping the existing consumers happy
  • Encouraging those consumers to spend more

Despite the amazing results that businesses have witnessed by applying retention marketing, the practice has been growing slow and has been met by a significant level of skepticism. Well, we just hope that by the end of this article we will have made a believer out of you in Retention Marketing.


Cheaper than Acquisition

It is true that it is more cost-effective to keep consumers within your reach than to go an extra mile to reach new ones.

However, if you need more convincing, there have been a several empirical researches that have proven that acquisition is much more costly for businesses than retention. One downside, however, is that as much as retention is cheaper, it is not necessarily easy to accomplish.

Profitability of Loyal Consumers

Not only is consumer loyalty cheaper, it often avails better returns. Your loyal consumers will spend more than any new consumers. In addition to this, loyal consumers will frequently spend on your product or service as opposed to newly found consumers.

However, even though loyal consumers are more profitable, do not push your luck by taking that loyalty for granted. Loyal consumers will be more open to increases in price, but do not raise your price as a test to see how much they would be willing to go; don’t be greedy. After all, Lifetime Revenue should be your goal, not a temporary increase in profits.

Standout in the Crowd

Put yourself in the shoes of a consumer and for a minute consider the brands that you frequently interact with. How many of these brands do you feel genuinely value your loyalty? My guess is that out of all the brands you stick to, only two give you a valued feeling.

Most brands will focus on consumer acquisition. Because of this, making your business a retention-centric one will automatically set you apart from the crowd.

People will be exposed to hundreds if not thousands of marketing initiatives from different brands every day. However, those people will only be engaged continually by those brands that give them a feeling of being connected. The best performing brands are those that focus on loyalty and always have a retention proposition incorporated in their marketing strategies.

Word of Mouth Referrals

Retention marketing earns you loyal customers and loyal consumers are just as important in promoting your brand as a vigorous brand campaign. Despite all our efforts in employing the best marketing strategies, people will always remain susceptible to the influence of friends and family.

People will consider brand referrals from friends and family more seriously than they would a flashy and attractive campaign or advertisement. The consumers you build a good relationship with will not hesitate to refer your brand to their various networks.

Also, if these referrals happen on social media platforms, they will be exposed to an even greater mass. As such, one loyal consumer’s recommendation may end up promoting your brand to hundreds of people.

Learn from Seth Godin on how to get your ideas spread.

Readily Available Feedback

Retention marketing avails your consumers an avenue to give feedback. Feedback is essential for your business’s success.

Consumers who take the time to give feedback to a brand have already given that brand the benefit of the doubt and are in all probability already loyal.

Such consumers will be telling you what to do in order for you to keep their business for longer. In addition to this, individuals who have made complaints and seen results are more likely to remain loyal to your brand.

Consumers go Above and Beyond for your Business

Frankly, we can all agree that it is difficult to stay loyal to a brand when a similar product has a lower price.

However, for most consumers, the rewards they get from sticking to a certain brand makes them stay loyal to it regardless of the fact that there are cheaper products in the market.

Retention marketing strategies are geared to provide your current consumers with the best value possible and such they will always be inclined to stick to your brand.

Reception to Marketing

By applying retention marketing, you will increase the rate of positive reception that you receive in your marketing endeavors. We all, to some extent, get agitated from being marketed to. However, loyal consumers will agree that they even appreciate when the brand of their choice reaches out to them and more often than not, these consumers respond to the brands promotional offers.

For example, Apple consumers have been known to queue for hours in anticipation of a new product’s release. This is because they have become so loyal to the brand that they readily anticipate and act upon any form of marketing that the brand presents to them.

Allowance to Experiment

Loyalty is fleeting; therefore, too many changes may end up pushing even your most loyal consumers away. However, retention marketing earns you the allowance to freely experiment in business. Once you have established a solid base of proven consumers, your brand will be in a position to expand its boundaries without much fear.

For example, assume you are launching a newly designed logo or a new product line; with retention marketing your consumers will be inclined to stick with you.

In fact, some of the most loyal consumers may even be excited to see a change in your business. Since you have already captured these consumers, they might view any changes in your business as provision of new and exciting products and services and even root themselves even deeper in your business.


If you are convinced by now to embrace retention marketing in your business, the following are simple pointers that will better position you in your endeavor to adopt this new practice.

  • Set Goals and Measures for Quantifying Progress: Prior to implementing a retention marketing strategy, it is essential that you identify the goals that you have in implementing of that strategy. What do you hope to accomplish? How will you measure progress? It is likely that you already have measurements systems that you use to assess your consumer acquisition. But now you want to have measurement systems that assess the value of your consumers beyond that first purchase. As opposed to focusing on the comparison of the cost of consumer acquisition against the consumer’s first purchase, you should now lean into calculating your consumer’s lifetime value. By using this measurement system, your business will be able to anticipate future revenue as consumer retention grows as a part of your marketing strategy.
  • Understand Your Current Consumers: Customers like doing business with organizations that understand their needs even prior to their voicing them. Consumers want to feel that organic connection with your business. Take every opportunity that you get with your consumers as an avenue through which you can gather information. This information can be compiled from email interactions, social media platforms, as well as online consumer communities. This information can then be used to create to create comprehensive consumer personas. By taking this initiative, you will be better equipped to understand your current consumer base and gain a concise understanding how to better satisfy your consumers’ needs.
  • Identify Potential Consumer Defect: Once a consumer has decided to take their business elsewhere and abandon a brand, it is usually too late for that organization to do anything about it. However, if you position your retention marketing strategy to identify defecting consumers, you will be able to reach out to them and solve their issues before you lose them. The trick is understanding which signs to look out for.

For example, in today’s world, one of the most effective means of identifying potential consumer defects is the level of engagement and interest the consumers have in your online business platforms. By carefully monitoring your consumer’s behavior on such platforms, you will be able to identify the consumer relationships that are strongly rooted and those that could benefit from your intervention.


This section of the article delves into detail on the various strategies of retention marketing and how they can be applied to ensure that you capture and keep consumers loyal to your business or brand.

Data Technology Investment

Retention marketing is all about communication with your consumers on a personal level through conveyance and offers that are sensitive to their needs. With the advances in technology, technological personalization is practicable for businesses of any size. However, for you to be able to personalize your marketing in such a way that it speaks individually to your consumers, you will need information and data on them in order to create consumer persons you can use.

Analyzing and pulling this data used to be something only big companies used to be able to do due to the high costs involved. Now, companies that specialize in eCommerce can easily provide you with all the available data a business could require at affordable rates.

In addition, you can employ a third-party expert to assist in the collection, analysis, and consumer persona creation from the data gathered on your consumers. By investing in this technology, your business will be able to understand its consumer base much more intimately.

Understanding the consumers on such a level will give you insight into their needs and you can, therefore, position yourself to satisfy those needs. The result of this will be a much more fulfilled customer base, which will proportionally translate into customer loyalty for your business and brand.

Building and Monitoring Social Media Relationships

In this day and age, we can guarantee that your consumers are online, and so should you. The widespread use of social media platforms has transformed how businesses interact with their consumers. Through Facebook, Twitter, and other social media platforms, you have an avenue to connect with your consumers 24 hours a day without them necessarily having to come to your business location. Social media platforms give you an avenue to build a one-on-one connection, so take advantage of them.

The advantage of social media is that it takes a shorter time to build communities and make connections with consumers than traditional in-person methods. Take advantage of social media platforms to learn how your consumers feel towards your business and develop a personal relationship with them.

Reprioritizing and Restructuring Priorities

Priorities in business are normally ranked based on their profitability. Since it is so easy to measure the business’s rate of consumer acquisition, it is often given high priorityin marketing. However, the smartest marketers will tell you that retention marketing is equally, if not more important, than consumer acquisition. As mentioned above, retention marketing does not only result in the improvement of your bottom line but is also cheaper for your business in the long run.

While this sound very good in theory, you need to understand that retention marketing demands full time commitment. This means involvement from the highest level in your business’s hierarchy to the lowest levels; not just the marketing department. This implies that you will need to create a totally new division in your business that specializes in retention marketing instead of just adding a task onto an already existent department.

Businesses that consider retention marketing a high priority are rewarded handsomely for their initiative. While it is not an easy task to implement this new approach into your already established marketing strategy, your ability to retain those consumers you worked so hard to get will definitely pay off for your business.

Extraordinary Consumer Service

It should be a continuous mission of yours to keep your customers satisfied in order for them to tell others about the experience that they had conducting business with you. You can achieve this for your business by delivering higher than usual levels of service to every consumer you encounter.

Key aspects of delivering high quality customer service are inclusive of:

  • Dedication to consumer satisfaction from employees
  • Provision of immediate response to consumer issues
  • Going above and beyond your normal duties to the consumer
  • Timely delivery of products and services
  • Excellent after sale services
  • Detect free delivery of products and service

Outstanding consumer service results in repeat clients for your business, as opposed to poor or average consumer service that does nothing to encourage the consumer to maintain your business.

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Courtesy Promotion

As simple as it sounds, this implies the establishment of a great system that enhances the interpersonal skills of every employee within your organization.

This initiative involves speaking to colleagues and consumers alike in a polite and pleasant manner. It involves the promotion of a culture of interaction devoid of sarcasm, apathy, or parody.

This approach inspires a pleasant feeling in your employees who are in turn inspired to be just as pleasant when they come into contact with your consumers. Employees are encouraged by this system to deal with employees in a warm, gentle, and inviting way.

The result of this is that your business winds up having deeply rooted, warm, and trusting relationships with the consumers, hence, promoting long term retention.

Product/Service Integrity

In order to realize consumer retention and long-term success in your business, do not attempt any ethical shortcuts. Your business must exhibit absolute consistency between the things you promise and the things you deliver.

The design, quality, serviceability, and dependability of your product and services must be of a standard that satisfies your consumers’ needs and expectations. Product and service integrity is demonstrated in the manner in which you handle even the smallest of aspects in delivery of products and services. Consumers will always be attracted to your business if you prove over and over again that you are honest and trustworthy and that you take a genuine interest in their concerns.

Once you have cultivated in the consumers’ minds that you are honest, open, and dependable, retaining them becomes a natural and organic result.


Although retention marketing has been a slow developing concept in the business world, it may be the most important aspect you incorporate in your business right now. Nurturing your existing consumer base and promoting loyalty to your brand is one of the most unequivocal ways of establishing a business that has sustainable growth.

Fortunately, the strategies you applied in acquiring your consumers are not so different from those that you will apply in retaining them; they key is to show consistency and improvement. Know your consumers, speak directly to their issues and concerns, and gather information and data in order to track your progress in retention.

Retaining your consumer base and conducting business with your clientele is much more affordable and fruitful than prospecting new business. Most businesses focus on consumer acquisition as opposed to consumer retention marketing, even where it is much more expensive to acquire customers.

Be the first in your field to shift focus and put more emphasis, effort, and resources into retention marketing strategies such as those discussed above. This will save you the hustle of trying to acquire new consumers, lower costs involved in acquisition, and increase your businesses revenue in the long run.

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